Orders increase, key industries recover strongly
According to the Ministry of Industry and Trade, industrial production increased across the board when the industrial production index (IIP), specifically in the first 10 months of 2024, IIP is estimated to increase by 8.3% over the same period last year (same period in 2023 increased by 0.5%). Of which, the processing and manufacturing industry increased by 9.6% (same period in 2023 increased by 0.5%), contributing 8.3 percentage points to the overall increase.
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| To promote industrial growth, it is necessary to improve competitiveness and remove bottlenecks to create momentum for industrial production development. Photo: Can Dung |
In particular, some localities have IIP indexes with quite high growth rates of two to three digits due to the high growth of the processing and manufacturing industry or the electricity production and distribution industry. Specifically: Khanh Hoa increased by 175.2%; Dien Bien increased by 57.1%; Cao Bang increased by 48.5%; Tra Vinh increased by 48.3%; Lai Chau increased by 42.7%; Son La increased by 39.6%; Thanh Hoa increased by 21.9%...
Assessing industrial production in the first 10 months of 2024, the representative of the Department of Industry (Ministry of Industry and Trade) pointed out that the strong recovery of key industries such as textiles, footwear, steel, electronics, food processing, etc. has reflected a rapid recovery. This shows that the input sectors for production and business are recovering strongly.
For example, according to the Vietnam Textile and Garment Group (Vinatex), the garment export market in the first 9 months of 2024 has recovered due to the shift of orders from China, Bangladesh, Myanmar to Vietnam. Inventory in key markets such as the US, Europe, and Japan has tended to decrease compared to the same period last year, combined with an increasing purchasing power, creating a recovery in demand for orders from partners.
Vietnam's textile and garment exports are expected to reach the target of 44 billion USD in 2024. For Vinatex, it is likely to successfully reach its 2024 production and business plan, but it still needs to be cautious in the context of the market not showing many positive signals to be able to hope for breakthrough results in the near future.
Mr. Cao Van Hung, Director of International Market Development, Smart Vietnam Precision Mechanical Joint Stock Company, shared that last year, the company clearly felt the decline in orders. However, since the beginning of this year, there have been many positive signals helping the company grow. In 9 months, sales increased by 178% and it is predicted that this figure could reach 230% - 250% by the end of this year.
Previously, according to S&P Global, the Vietnam Manufacturing Purchasing Managers' Index (PMI) rose sharply to 51.2 points in October, surpassing the 50-point threshold after suffering disruptions caused by Typhoon Yagi in September 2024. Business conditions have strengthened in 6 of the past 7 months.
“October data showed a recovery driven by rising new orders and businesses expanding production ,” said Andrew Harker, chief economist at S&P Global Market Intelligence.
According to analysts, the continued rise in domestic production shows that Vietnam is entering a period of good growth in the last months of this year and has favorable factors to promote the development of industrial production. A recently released report by the World Bank forecasts that Vietnam's economic growth will reach 6.1% in 2024, higher than 5% in 2023, then will increase to 6.5% in 2025 and 2026.
Resolutely and rapidly maintain year-end growth momentum
Optimistic about the resilience of the country's industrial production, accordingly, the IIP growth target of 7-8% in 2024 can be achieved, the Ministry of Industry and Trade and localities have been taking drastic actions.
Economists say that the world economic outlook is brighter now, and demand has returned. Many domestic enterprises have recently taken advantage of government support policies to invest in technology and restructure their businesses. As a result, production is gradually improving, businesses are taking advantage of opportunities, and have more new orders.
Domestically, Vietnam's economy is still maintaining macroeconomic and social stability in the context of geopolitical and economic fluctuations in the world, which will continue to create favorable conditions for attracting investment and promoting production and business in the coming time. Reputable international organizations continue to positively assess and forecast Vietnam's economic prospects in 2024 and the coming time.
According to the representative of the Ministry of Industry and Trade, the Ministry is focusing on key solutions to remove difficulties for businesses to promote production development on the basis of closely following the production situation of industries, fields, and some key industrial localities.
Mr. Chu Viet Cuong, Director of the Industrial Development Support Center - Department of Industry, said that in recent times, localities have strongly developed clusters and industrial linkage zones, in order to create conditions for enterprises to share resources, knowledge and technology. The development of these industrial linkage clusters has shown outstanding efficiency in production compared to other industrial zones, thanks to the concentration of many manufacturing enterprises in the same field. This cooperation also helps reduce costs and allows enterprises to quickly share knowledge and new technology with each other.
“ Associations and industries need to act as a bridge, providing information to supporting industry enterprises about each other’s production capacity and needs. In addition, the Ministry of Industry and Trade also promotes connecting domestic enterprises to participate in the supply chain of large global FDI enterprises investing in Vietnam… From there, helping industrial production accelerate towards the end of the year, ” said Mr. Chu Viet Cuong.
In addition, the Ministry of Industry and Trade will continue to proactively and effectively implement business support policies approved by the Government to remove difficulties and obstacles in production and business activities of enterprises; promote the operation of new industrial production projects to serve export and domestic consumption, creating more capacity for production development and goods sources for export.
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