New orders rise, boosting production

Right at the middle of the second quarter, the economy was optimistic as the number of new orders continued to increase, pushing manufacturing industries to accelerate and break through.

This is the assessment of Dr. To Hoai Nam - Permanent Vice President and General Secretary of the Vietnam Association of Small and Medium Enterprises (VINASME) when talking to VTV Times reporter about the production and business situation of Vietnamese enterprises in the third quarter of 2024.

New orders continue to grow strongly

According to the Vice President of VINASME, despite many difficulties, most businesses have basically revived their production and business activities, gradually escaping the recession as orders have grown positively since the beginning of the second quarter until now. Many businesses in the association shared that they have orders until the end of this year.

As evidence, in the report just released by S&P Global today, September 4, the Vietnam Manufacturing Purchasing Managers' Index (PMI) reached 52.4 points in August, although down from 54.7 points in July, it still shows a strong improvement in business conditions in the middle of the third quarter.

According to statistics from the General Department of Customs, the total import-export turnover of the whole country from the beginning of the year to mid-August exceeded 473 billion USD, an increase of nearly 17% over the same period last year. The trade balance of goods also had a surplus of nearly 15.5 billion USD, showing that goods exports continue to maintain their leading role in economic growth, being the main driving force helping the Vietnamese economy achieve high growth throughout this year.

Looking back from reality, it is clear that from the end of the first quarter until now, the production - business - export indexes have improved and grown impressively. Vietnamese enterprises have improved production output and business indexes when the number of new orders continues to increase, thanks to improved consumer demand in both domestic and export markets.

Notably, discussing opportunities for exports, Mr. Tran Thanh Hai - Deputy Director of the Import-Export Department (Ministry of Industry and Trade) said that by the end of August, the number of new export orders had increased for the fifth consecutive month since March 2024.

Typically, data from the Vietnam National Textile and Garment Group shows that in July 2024, Vietnam's textile and garment export turnover exceeded the 4 billion USD mark and was also the month with the highest export turnover since August 2022. Specifically, Vietnam's textile and garment export turnover reached 4.29 billion USD in July 2024, up 12.4% over the same period last year and up 16.1% over the previous month. In the first 7 months of 2024, Vietnam's textile and garment export turnover reached 23.9 billion USD, reaching over 50% of the annual export target.

In addition, it is impossible not to mention the wood and wood products industry. This is also an export industry that brings in billions of USD to the economy. Although the industry suffered a severe decline in 2023, the past months of 2024 have recorded a positive recovery of this industry when the export value of wood and wood products in the first 7 months of 2024 is estimated at 8.8 billion USD, an increase of 21.9% over the same period in 2023. Even for many businesses in this industry, factories are currently operating non-stop to be ready to supply large quantities of wooden furniture to serve the year-end holiday season for foreign markets.

The last months of the year are full of promise

On the other hand, when looking at the general production picture, some experts still recommend that in the context of industrial production being assessed as recovering unevenly and not comprehensively. As evidence, in 7 months, 3/63 localities had a decrease in IIP. In addition, some key manufacturing industries such as smartphones, televisions, automobiles, crude iron and steel... still decreased compared to the same period. Notably, some of our country's key export items such as footwear, wood, phones of all kinds and components... although recovering positively, have not yet returned to the peak level of the same period in 2022....

Currently, wood businesses are operating non-stop to be ready to supply for export.

However, most economic experts remain optimistic and believe that the good news is the capacity of businesses. "Notably, domestic businesses have improved thanks to the combined impact of the Government's support policies. A new positive signal is that domestic businesses' export growth is nearly twice that of foreign-invested enterprises (FDI)," Mr. Nam emphasized.

On the brighter side, there was inflation, with both input costs and output prices rising much more slowly in August, said Andrew Harker, chief economist at S&P Global Market Intelligence. In fact, this is believed to have been a contributing factor to the sustained increase in new orders. Overall, the manufacturing sector has continued to perform well in the second half of the year so far, with much to be done in the coming months.

Moreover, up to now, with a highly open economy like Vietnam, export is an important driving force for economic growth. And in reality, export is getting better towards the end of the year. "Currently, many large markets and the recovery in consumption of goods in the last months of the year create more room for industries to contribute to export turnover. In particular, Vietnam's key export industries such as textiles, footwear, wood and products, electronics... have been and are regaining growth momentum, with the opportunity to receive many new international orders," Mr. Hai analyzed.

In addition, since the second quarter, although some manufacturers have reported increases in raw material prices, the rate of price increase has slowed down amid competitive pressure. Meanwhile, falling oil prices and the continued downward trend in the coming time will help reduce transportation costs, reducing pressure on import and export activities until the end of the year.

Also according to notable information from the Ministry of Industry and Trade, the majority of manufacturing enterprises said they are optimistic that production and output will increase in 2025 as customer demand is improving and the number of new orders continues to increase. "It is forecasted that some key export industries to the United States will continue to increase in the coming time when the Fall-Winter season is coming and suppliers are actively purchasing goods for stockpiling before the election in November 2024. Along with the promotion of export activities through participation in specialized fairs such as: coordinating with the VASI Association of Supporting Industries to attend the Fabtech 2024 Fair from October 13-22 in Orlando; Hamee Electrical and Mechanical Enterprises Association attending the IMTS Fair organized by the American Manufacturing Technology Association in Chicago in September 2024... exports will have many opportunities for strong growth", said Mr. Do Ngoc Hung, Head of the Vietnam Trade Office in the United States./.

Source: https://baoquangninh.vn/don-dat-hang-moi-tang-cao-thuc-day-san-xuat-tang-toc-3317371.html