Exports exceeded imports in February by $900 million, based on preliminary figures released today by the General Statistics Office in Hanoi. January’s trade balance was revised to a surplus of $776 million, the report showed.
Vietnam posted an annual trade surplus in 2012 for the first time in two decades after three years of narrowing deficits, as the slowest economic growth in 13 years curbed import demand. At the same time, shipments of items from electronics to apparel improved, helping build foreign-exchange reserves and providing “a larger buffer to cope with any further capital flight,” Fitch Ratings said last month.
“The improving trend reflects structural changes in the economy, as all of the foreign companies’ imports in recent years are now boosting export capacity,” Matt Hildebrandt, a Singapore-based economist at JPMorgan Chase & Co., said before the data. “Part of the improvement also reflects softer import demand, due to subpar growth.”
Concerns about the rising level of bad debt have made the nation’s banks reluctant to lend, curbing corporate expansion and damping import demand. Export growth last year was driven by foreign companies, as local firms struggled to increase shipments, according to Nguyen Xuan Thanh, a Ho Chi Minh City- based lecturer with the Harvard Kennedy School’s Vietnam program.
Exports fell to $7.5 billion in February from a revised $11.47 billion in January, the Statistics Office said today. The week-long Tet Lunar New Year celebration, during which most factories are closed, was in February this year and in January in 2012. For the first two months of the year, shipments rose 23.9 percent to $18.97 billion.
Imports fell to $6.6 billion from a revised $10.7 billion in January. For the first two months of 2013, they climbed 10.2 percent to $17.3 billion, the data showed.
Last year’s trade surplus also allowed the central bank to maintain the stability of the dong, which traded at 20,835 per dollar as of 2:38 p.m. in Hanoi, compared with 20,885 on Feb. 22. The Ho Chi Minh City Stock Exchange’s VN Index (VNINDEX) rose 1.3 percent.
--Jason Folkmanis in Ho Chi Minh City. With assistance from Ailing Tan in Singapore. Editors: Rina Chandran, Oanh Ha
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