Vietnam’s gross domestic product (GDP) growth in the third quarter of 2022 exceeded all forecasts with an estimated increase of 13.67 percent compared to a year ago, bringing the figure in the first nine months of the year to 8.83 percent. Inflation was still controlled below the set target (four percent per year). However, a global growth slowdown and rising risks of financial instability could affect Vietnam’s economic growth in 2023 and 2024.

Ramla Khalidi, resident representative of the United Nations Development Program (UNDP) in Vietnam, said Vietnam has bright economic prospects, but risks are increasing.

Domestically, risks threaten the banking sector and bond market, which are especially sensitive to rapidly changing conditions in the real estate sector. In addition, the negative impact of climate change is expected to exert great pressure on agricultural production.

Dr. Tran Toan Thang, head of NCIF’s Industry and Enterprise Economic Forecasting Department, said inflation is currently not a big problem, but inflationary pressure is increasing. The risk of imported inflation is obvious due to the country’s dependence on imported raw materials and increasing exchange rate between the US dollar and Vietnamese dong under the pressure of a strong US dollar appreciation. A downward export trend in 2023 is also a distinct possibility due to falling demand. In the last months of the year, many businesses have faced difficulties in receiving export orders.

Latest highline news about Vietnam's exports of 2023 May

• Vietnam's exports fell 12% year-on-year to $108.57 billion in the first four months of 2023.
• The decline was mainly due to the fall in exports of phones and electronics, which fell 23.4% year-on-year to $32.64 billion.
• Exports of textiles and garments also fell 12.3% year-on-year to $22.21 billion.
• However, exports of agricultural products rose 13.3% year-on-year to $15.66 billion.
• The government is taking steps to boost exports, including signing free trade agreements with other countries.
• It is also working to improve the country's logistics infrastructure.

The factors that are affecting Vietnam's exports:

• The global economic slowdown is affecting the demand for Vietnamese exports.
• The war in Ukraine is also disrupting supply chains and causing prices to rise.
• The government is taking steps to mitigate these challenges, but it will take time for the economy to recover.

source: tradingeconomics.com

Vietnam wood and wood products exports fell in January and February 2023

According to Global Wood Trade Network, Vietnam’s exports wood and wood products fell by 34.8% to US$1.6bn year-on-year in January and February 2023. This is due to a fall-off in demand, according to the Export and Import Department under Ministry of Industry and Trade.

In February 2023, exports of wood and wood products in Vietnam decreased by 0.7% from January to $800m, and down 10% compared to the year before.

Exports of wood products, including furniture, contributed the most to the decline, posting a revenue of $490m, down 29.7% from 2022.

Industry experts argued that ever since the peak of COVID-19 pandemic where consumers spent their purchasing power on home improvements during lockdowns, global demand for furniture has decreased significantly. Furthermore, global inflation dampened demand in the wood industry in the year-end period in 2022 and early 2023, local online newspaper VnEconomy cited the chairman of the Vietnam Timber and Forest Products Association (VIFOREST) as saying. 

In 2022, Vietnam recorded over $16bn worth of wood and wood products exports, which is 3.8% above the target set by Vietnam, in spite of high inflation, rising material costs and log-jammed supply chains.

In 2023, the country expects to clock in as much as $18bn from wood and wood products exports, with a focus on wood pellets and wood chips to reach $1bn, as the spike in the cost of fuel has raised interest in using these products as alternatives to heating.

Source: Global Wood Trade Network/ Trading Economics /