Tuesday,  Jun 19, 2018,13:41 (GMT+7) 0 0
Vietnam sees trade deficit with Indonesia ballooning
Quoc Hung
Monday,  Aug 28, 2017,22:27 (GMT+7)

Vietnam sees trade deficit with Indonesia ballooning

Quoc Hung

HCMC – Vietnam’s trade with Indonesia has changed from a surplus in favor of the former in 2015 to a deficit in 2016, and the trade deficit is poised to further increase this year and the coming time, according to data from the General Department of Vietnam Customs.

According to the customs, two-way trade in the January-July period reached US$3.64 billion, up 23.7% compared to the same period last year.

In particular, Vietnam exported US$1.63 billion worth of goods to Indonesia, up 10.3% year-on-year, and spent over US$2 billion buying goods from Indonesia in the period, a year-on-year surge of 37.4%. This led to a January-July trade deficit of US$370 million, which is equivalent to Vietnam’s trade deficit with Indonesia in all of 2016.

Last year, two-way trade totaled US$5.61 billion, of which Vietnam earned US$2.62 billion from exports and spent US$2.99 billion on imports, resulting in a trade deficit of US$373 million.

Meanwhile, Vietnam still posted a trade surplus of US$111 million with Indonesia in 2015.

According to the General Department of Vietnam Customs, Indonesia is one important trading partner of Vietnam among ASEAN countries, with two-way trade accounting for 13.5% of total foreign trade between Vietnam and ASEAN countries.

The widening trade deficit with Indonesia in the first seven months of 2017 resulted from sharp increases in imports of several key commodities. Customs data shows that in January-July, Vietnam imported 12,600 completely-built-up (CBU) autos worth nearly US$222 million from Indonesia, accounting for over 11% of total imports.

According to economic experts, imports of autos from Indonesia will continue to soar after import duty on autos originating in ASEAN countries falls from the current 30% to 0%. Some domestic auto assemblers have stopped assembling a number of models in Vietnam and turned to importing CBU autos from Indonesia.

In addition to autos, Vietnam imported US$193 million worth of coal from Indonesia in the first seven months, accounting for 9.6% of total imports, US$138 million worth of metals, US$113 million of machineries, US$112 million of chemicals and US$111 million of paper.

On the other hand, Vietnam’s exports to Indonesia in the first seven months increased by 10.3% year-on-year after two consecutive years of decrease, reaching US$1.63 billion. Notably, exports of phones and phone parts to Indonesia in the seven-month period amounted to US$358 million, accounting for nearly 22% of Vietnam’s total exports to this country.

Vietnam exported US$128 million worth of computers and electronic products, US$136 million of machineries, US$108 million of garments and footwear, and US$222 million of iron and steel to Indonesia in the period.

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