Vietnam : Export Performance in 1999 and Beyond
Changes in trade policies have been an essential component of the "doi moi" policy implemented by the Government of Vietnam since 1986. Over the years, most export quotas have been lifted and export taxes have been reduced to generally lo...
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| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2000/06/2637903/vietnam-export-performance-1999-beyond http://hdl.handle.net/10986/15272 |
| Summary: | Changes in trade policies have been an
essential component of the "doi moi" policy
implemented by the Government of Vietnam since 1986. Over
the years, most export quotas have been lifted and export
taxes have been reduced to generally low levels. In
addition, export activities by the private sector (both
domestic and foreign) have been increasingly encouraged,
thus breaking the trade monopoly of a small number of
state-owned enterprises. These reforms -together with sound
macroeconomic management- have led to a rapid export and
import growth. The structure of exports also changed. During
the 1990s, Vietnam started to exploit its comparative
advantage in labor-intensive manufactures. Export growth was
led by light manufactures, dominated by the garment and
footwear sectors. Also remarkable, despite the shrinking
share of agricultural goods in total exports, was the strong
rise in the volume of rice exports. In only few years
Vietnam turned from being a net rice importer into the
world's second largest exporter. The Asian crisis has
interrupted Vietnam's trade expansion. In 1998, exports
increased by a sluggish 2.1 percent. To avoid an external
deficit, the Government imposed additional import
restrictions which, together with slumping domestic demand,
led to a 0.8% decrease in the value of imports. Of course,
this downturn in export performance was not unique to
Vietnam. It was observed across Asia. What is surprising,
however, is the exceptional magnitude of the recovery in
1999. Table 3 shows that in 1999, Vietnam's exports
grew by an impressive 23.4 percent, much faster than in most
other Asian countries. While Indonesia is still struggling
to recover from the crisis, exports expanded at a quick pace
in Korea, Malaysia and the Philippines. None of these
countries, however, came close to Vietnam's astonishing
rate of export growth. As can be seen in this report,
Vietnam's recovery is not exclusively an oil-related
phenomenon. Non-oil exports also grew at a fast 16.3
percent. This paper takes a detailed look at the factors
that explain this strong export performance in 1999 and asks
whether such a high rate of export growth can be sustained
in the year 2000 and beyond. The analysis relies on two type
of sources: official trade data collected by the General
Statistical Office (GSO) and Vietnam Customs, as well as
information collected during a visit of 16 companies in the
footwear and garment industries in Hanoi, Hai Phong, Bien
Hoa and Ho Chi Minh City in May-June 2000. The visit
included seven private domestic companies, four private
foreign-owned enterprises, and five public enterprises. All
these companies were among the largest and fastest growing
exporters in 1999. |
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