Steel inventories have fallen sharply and garment-textile enterprises have received stable orders
|Paper is produced at a Viet Nam Paper Corp's mill in the northern province of Phu Tho. Enterprises are getting more competitive. -- VNA/VNS Photo Vu Sinh
HA NOI (VNS) — Industrial production is expected to improve in the second quarter of this year as many domestic enterprises step up raw material imports for production, Ministry of Industry and Trade official Nguyen Tien Vy said at a meeting here yesterday.
According to the planning department director, inventory levels in the steel industry have fallen sharply and hovered at about 280,000 tonnes. He said many garment and textile enterprises had already received stable orders for the second quarter and were negotiating for the third.
In the first quarter, the index of industrial production (IIP) reached a low level of 4.9 per cent, compared with 5.9 per cent in the same period last year.
Vy said inventories began to increase in March, adding that the rate for manufacturing and processing industries was 16.5 per cent higher than for the same period last year.
Sectors with high inventories included electricity cable (62 per cent), metal components (35.5 per cent), motor vehicles (37.3 per cent), concrete, cement and plaster (28 per cent), and chemicals (27.4 per cent).
Vy attributed the reduction of industrial production to the 10-day-long Tet (Lunar New Year) holiday and to economic difficulties.
Viet Nam is expected to have a trade surplus of US$482 million in the first quarter of this year with a total export turnover of $29.68 billion, a rise of 19.7 per cent over the same period last year.
Ministry statistics showed that the surplus will mainly come from the foreign direct investment (FDI) sector. The domestic sector saw imports exceed exports by more than $2.6 billion while FDI businesses had a trade surplus of $3.1 billion.
Deputy Minister of Industry and Trade Tran Quoc Khanh said the FDI sector helped the export value of mobile phones and components hit $4.48 billion, and electronic products, $2.42 billion.
"Samsung Viet Nam's mobile phone exports have a great impact on the country's overall export situation. If this company's contribution is excluded, the first quarter will see an export growth rate of only 12.3 per cent," he added.
However, the nation's key export products slowed, with rice export value falling by 3.1 per cent and fishery products down 5.5 per cent.
Nguyen Minh Toai, director of southern Can Tho City's Department of Industry and Trade, said that a rice reserve of 1 million tonnes helped push up the rice price by VND100-300 per kilogram.
But many enterprises did not buy rice directly from farmers and profits mostly fell into the hands of intermediaries, he said, urging an increase in the floor rice price to be considered carefully to improve farmers' incomes.
Minister of Industry and Trade Vu Huy Hoang said the ministry would further assist enterprises with capital, administrative procedures and markets to help them overcome the hard time.
"The ministry will keep a close watch on market changes so that it can advise enterprises when to limit business risks," he said. "We will also take the necessary steps to assure goods reserves to prevent falls in export prices."
Hong urged organisations to strengthen promotional activities to boost consumption and reduce inventories.
"Drastic measures must be taken during the remainder of the year so that the year's target can be fulfilled, especially in the nation's major export markets in the US, the European Union and Japan haven't shown any clear signs of recovery," said Khanh.
Economic expert Nguyen Minh Phong said that domestic enterprises should enhance their competitiveness, especially raising the added value of their products. — VNS