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Vietnam-China Trade Deficit Analysis

The presentation analyzes the trade performance between Vietnam and China over the last decade, focusing on definitions of key economic terms, current trade situations, and recommendations. Vietnam's export revenue has steadily increased, but it faces a trade deficit with China, which is its largest trading partner. The document highlights the importance of adapting to changing commodity structures and suggests strategies for improving trade relations.
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0% found this document useful (0 votes)
35 views4 pages

Vietnam-China Trade Deficit Analysis

The presentation analyzes the trade performance between Vietnam and China over the last decade, focusing on definitions of key economic terms, current trade situations, and recommendations. Vietnam's export revenue has steadily increased, but it faces a trade deficit with China, which is its largest trading partner. The document highlights the importance of adapting to changing commodity structures and suggests strategies for improving trade relations.
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Good afternoon everyone , im Minh and today i will represent for my group about an intersing

topic . As you can see from the screen, my topic today is Analyze the trade performance
between Vietnam and China over the last 10 years.

- My presentation is divided into 3 parts : definition , situation and recommendation .


- i’ll will start with defination about some economic terminology:

+> Trading volume is the total number of shares of a security that were traded during a
given period of time

+> Trade value means the total value of trades executed from the beginning of a certain
period such as daily, weekly, monthly or quarterly, or till the date of resignation.

+> Commodity structure enables you to categorize items, services, and supplier branch
information in a hierarchical tree structure.

+> Market share is the percent of total sales in an industry generated by a particular
company.

+> Balance of trade is the difference between the monetary value of a nation's exports and
imports over a certain time period.

 All are based on theoretical basis for development such as : the Heckscher- Ohlin ,
Absolute advantage, Comperative advantage , International trade , Factors affecting

- we will move to the next part is situation between vn and china. I also divided it into 2
sections : situation in vn and china trade and evalute

+> A is export and import turnovers :

 It is evident that Vietnam's export revenue increased steadily from 132 to 371 billion
USD between 2013 and 2022. Put another way, at that time, Vietnam's trade volume
increased steadily. On the other hand, the export turnover curve's slope indicates
that there are three significant phases in the chart: 2013–2016, 2016–2020, and
2020–2022
 As can be observed, the import turnover chart, which shows growth from 132 billion
USD to 371 billion USD between 2013 and 2022, is somewhat similar to the export
turnover chart. The import turnover in 2023 is only 355 billion USD, which is a minor
decrease.
Prior to the COVID-19 pandemic, imports increased by an average of 12.5% year, or
almost twice as much. Although this is a sizable figure, it also aligns with the labor
market's demand for commodities. Products have changed, moving from leather
and textiles to computers and electronic parts. Furthermore, Vietnam's export
markets are sizable due to its signing of free trade agreements with China, Japan,
and Korea in the past.
 Similar to exports, Vietnam is managing production operations in addition to
combating the COVID-19 outbreak. In 2021 and 2022, respectively, the value of
imported goods is expected to reach 336 billion and 371 billion USD. One may argue
that free trade agreements save the world during hard times, as they guarantee
input supplies for industry and benefit a developing nation like Vietnam.

+> Next is balance of trade :

 In the period from 2014 to 2019, the import and export turnover of goods between
Vietnam and China grew steadily. As of 2019, the import-export turnover of goods
between Vietnam and China reached 117.01 billion USD, of which export turnover
reached 41.43 billion USD, import turnover was 75.58 billion USD. Although affected by
the Covid -19 pandemic, Vietnam and China still maintain bilateral relations and open
the exchange of goods, so Vietnam's import-export turnover of goods has grown quite
high, the total trade turnover between Vietnam and China reached 165.77 billion USD,
an increase of 24.6% compared to 2020. China continues to be Vietnam's largest trade
partner, with a total import-export turnover in 2023 of approximately 171.2 billion USD,
accounting for more than 25% of the country's total import-export turnover.
 Import value is much larger than export -> Vietnam is a trade deficit [Link] trade
balance is continuously maintained at a negative level and tends to increase every year
-> The risk of Vietnam becoming more dependent on China

+> C is commodity structure:

 The structure of Vietnam's exports to China is mainly agricultural - forestry - fishery


products, accounting for 31.2% of Vietnam's total export turnover to China and
accounting for 20% of total exports. 9% of the country's total export turnover of this
product group. Next is the group of computers, electronic products and components,
accounting for 15.9%; The group of textiles, garments, and footwear of all kinds,
accounting for nearly 13.0%; fuel and minerals group, accounting for about 10.0%; The
remaining are other commodity groups. In contrast, the majority of raw materials used
to produce Vietnam's export goods are imported from China.
( 2 hình đầu )

 In 2022, the report of the Ministry of Industry and Commerce of Vietnam showed that
there were as many as 14 batches of NK goods from China, amounting to more than US$
1 billion, two of which were worth more than US$ 20 billion. Specific: The largest group
is machinery, equipment, tools and spare parts from China, and its NK amount is US$
24.3 billion, down 2.5% from last year, accounting for 20.6% of the national NK amount.
The second largest category is computers, electronic products and spare parts, with a
value of US$ 24.1 billion, up 10.2% year-on-year, accounting for 20.43% of the amount
of NK. In addition, some other major NK products come from this market, such as:
fabrics are 9.2 billion US dollars, up 1.4% over last year, and mobile phones and parts
are 8.1 billion US dollars, down 12.3% over last year. ( 2 hình sau )

 +> Last is market share: According to following market share calculation formuala,
it is evident from the above data that Vietnam's percentage of imports from
China is consistently higher and double than that of its percentage of exports to
China over a period of 10 years from 2013. China consistently ranked among the
top exported into Vietnam, indicating a huge market share and significant
influence in our nation's trade relations.
Basically, in fact, since 2013, Vietnam's trade deficit with China has continuously
increased over the years, at a very fast pace, from about 13.17 billion USD up to
61.2 billion USD in 2023 for export. Thus, after more than 10 years, Vietnam's
trade deficit from China has increased more than 4.6 times. Similarly, Vietnam's
imports from China also increased steadily and reached the highest point at
117.87 billion dollars in 2022 .In recent years, this number has continued to
increase despite experiencing numerous economic recessions and a pandemic
- From situation above , we can sum up by some evaluation :
+> Import-export turnover has increased steadily over the years -> Vietnam has
taken good advantage of its advantages
+> The main products in import and export are also constantly changing -> Vietnam has
made good use of scientific advances
+> China is Vietnam's largest market share, is a close customer and plays an important
role in international trade with Vietnam
+> Vietnam is a large trade deficit country from China, with an increasingly larger trade
deficit -> the danger is that Vietnam will become increasingly dependent on China
- We can easily seen that vn not only have a lot of oppotunities but also faces with
challenges . As u can see on the screen ( đọc thách thức và có lợi )
- Finally, I’d like to address some recommendation which useful for trade between 2
countries:
+> In the sector of government and authorities , we mention some methods like : ( trên
bảng)
+> About enterpries: ( đọc )

- Now, just to summarize, I’d like you to take a look at the main point again and wrap up
for yourself some useful information. Thank you for your attention

Common questions

Powered by AI

Advantages of Vietnam's trade dependency on China include access to a large market for exports and a steady supply of raw materials needed for production . Disadvantages may consist of increased vulnerability to economic policies set by China and potential challenges in achieving trade balance independence, as evidenced by the growing trade deficit . Economically, this dependency can lead Vietnam to prioritize free trade agreements and regional partnerships to diversify its economic engagements and reduce reliance on a single country .

Vietnam saw significant changes in export turnover during three phases: 2013-2016, 2016-2020, and 2020-2022 . These changes were likely driven by Vietnam's strategic free trade agreements with China, shifts in global market demand, and its adaptation and expansion in industrial sectors such as electronics and textiles, complemented by technological advancements .

Future trends may see Vietnam further shifting towards exporting more high-tech products, such as electronics and machinery, as it capitalizes on technological advancements and builds on current electronics export trends . In imports, there might be a continuing emphasis on raw materials necessary for sustaining industrial growth, while fostering import diversity to reduce dependency on China .

The COVID-19 pandemic had a dual impact on Vietnam's trade with China. Positively, Vietnam maintained high levels of import-export turnover, 165.77 billion USD in 2023, showing resilience, largely due to bilateral relations and existing trade agreements . Negatively, disruptions in the global supply chain posed challenges to consistent trade flow and highlighted Vietnam's dependency risks .

Vietnam's market share shows that imports from China are significantly higher than exports, revealing an asymmetrical trade relationship . This dynamic highlights China’s substantial influence on Vietnam's economy, emphasizing Vietnam's role as a crucial but secondary player in the global trade network with potential strategies needed to diversify trading partners and markets .

The largest categories of imports from China include machinery and equipment (24.3 billion USD) and electronic products (24.1 billion USD), indicating a dependency on China for critical production inputs . This reliance underscores the role of China in supplying materials for Vietnam's manufacturing growth but also raises concerns about industrial vulnerability to Chinese supply chain disruptions .

Vietnam's consistent trade deficit, increasing from 13.17 billion USD in 2013 to 61.2 billion USD in 2023, suggests a growing dependency on Chinese imports . In the long term, this could lead to economic issues like currency devaluation, reduced national savings, and an over-reliance on Chinese goods, potentially undermining local industries and limiting Vietnam's ability to leverage trade terms .

Vietnam's strategy in entering into free trade agreements with countries such as China, Japan, and Korea reflects its goals to integrate into the global economy, enhance export markets, and secure critical input supplies . These agreements not only mitigate trade uncertainties but also aim to boost economic resilience and industrial sophistication .

Vietnam's exports to China have shifted from primarily agricultural-forestry-fishery products, which account for 31.2% of exports, to include more computers, electronic products, and components. This shift indicates a move towards more technologically advanced manufacturing and reliance on scientific advancements, showcasing Vietnam's evolving industrial base .

Free trade agreements have positively impacted Vietnam's trade performance with China by ensuring the continuity of input supplies critical for production even during economic downturns like the COVID-19 pandemic. These agreements have kept trade growth steady despite global challenges, marking them as stabilizing factors in turbulent times .

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