In the first quarter of the year, Vietnam spent billions of US dollars on imports of luxury items including automobiles, motorbikes and electronic goods, contributing to the high trade deficit of 3.5 billion USD.
Statistics from the General Statistic Department (GSO) showed that trade deficit has been a major problem, creating a macro-economic imbalance. Export turnover in the quarter stayed at 14 billion USD, 1.6 per cent lower than the same period last year, while imports jumped to 17.5 billion USD, an increase of 37.6 per cent.
The department said import turnover in the quarter surged 16.6 per cent over the same period last year excluding increasing price factors.
Apart from items to serve production including equipment, machines and oil, Vietnam has imported a huge amount of gold and jewellery, 200 million USD more than the same period last year. Electronics accounted for 1 billion USD, an increase of 53.1 per cent.
Import turnover of automobiles including accessories, was also at a high level, reaching 582 million USD, 66 per cent higher than last year. The country spent 207 million USD importing motorbikes.
Statistics from automobile import companies showed that consumption of high-grade automobiles worth 1 billion VND (54,054 USD) upward increased slightly despite the number of imported vehicles declining last month in comparison with the previous two months.
Euro Auto forecasts that the up-market auto business in Vietnam would be 10 to 20 per cent higher than last year.
"The increasing number of automobiles and motorbikes in the first three months of the year showed that a portion Vietnamese people have spent too much money during a difficult time," said deputy head of the Central Institute of Economic Management (CIEM) Nguyen Dinh Cung.
Other imported goods, which could have been sourced locally, including cowhide, corn meal, soybeans and waste paper were imported.
The GSO said that as many as 623 million USD was spent on importing livestock feed, 136 per cent higher than the same period last year.
Deputy General Director of Vietnam Chemicals Group Nguyen Gia Tuong said people and businesses that preferred using foreign instead of domestic products had partly attributed to the trade deficit.
Tuong said Vietnamese firms imported NPK fertiliser while the country had 300,000 tonnes of fertilisers in stock and domestic producers had reached their full capacity.
Ngo Van Tru, deputy head of the Heavy Industry Department said many construction sites imported industrial products despite Vietnamese products being of the same standard as foreign produced goods.
Doan Hong Quang, a World Bank's specialist in Vietnam said the country imported luxury items while its export products remain basic goods such as rice, aquatic products, garments and textiles, and crude oil.
"It is impossible to avoid a trade deficit as we received 9 VND from exports and spent 10 VND on imports plus money spent on machines," Quang said.
He added that Vietnam should impose higher taxes on luxury items.
"We need long-term plans including income control, creating investment opportunities and encouraging savings to avoid a trade deficit," Cung said./.
Statistics from the General Statistic Department (GSO) showed that trade deficit has been a major problem, creating a macro-economic imbalance. Export turnover in the quarter stayed at 14 billion USD, 1.6 per cent lower than the same period last year, while imports jumped to 17.5 billion USD, an increase of 37.6 per cent.
The department said import turnover in the quarter surged 16.6 per cent over the same period last year excluding increasing price factors.
Apart from items to serve production including equipment, machines and oil, Vietnam has imported a huge amount of gold and jewellery, 200 million USD more than the same period last year. Electronics accounted for 1 billion USD, an increase of 53.1 per cent.
Import turnover of automobiles including accessories, was also at a high level, reaching 582 million USD, 66 per cent higher than last year. The country spent 207 million USD importing motorbikes.
Statistics from automobile import companies showed that consumption of high-grade automobiles worth 1 billion VND (54,054 USD) upward increased slightly despite the number of imported vehicles declining last month in comparison with the previous two months.
Euro Auto forecasts that the up-market auto business in Vietnam would be 10 to 20 per cent higher than last year.
"The increasing number of automobiles and motorbikes in the first three months of the year showed that a portion Vietnamese people have spent too much money during a difficult time," said deputy head of the Central Institute of Economic Management (CIEM) Nguyen Dinh Cung.
Other imported goods, which could have been sourced locally, including cowhide, corn meal, soybeans and waste paper were imported.
The GSO said that as many as 623 million USD was spent on importing livestock feed, 136 per cent higher than the same period last year.
Deputy General Director of Vietnam Chemicals Group Nguyen Gia Tuong said people and businesses that preferred using foreign instead of domestic products had partly attributed to the trade deficit.
Tuong said Vietnamese firms imported NPK fertiliser while the country had 300,000 tonnes of fertilisers in stock and domestic producers had reached their full capacity.
Ngo Van Tru, deputy head of the Heavy Industry Department said many construction sites imported industrial products despite Vietnamese products being of the same standard as foreign produced goods.
Doan Hong Quang, a World Bank's specialist in Vietnam said the country imported luxury items while its export products remain basic goods such as rice, aquatic products, garments and textiles, and crude oil.
"It is impossible to avoid a trade deficit as we received 9 VND from exports and spent 10 VND on imports plus money spent on machines," Quang said.
He added that Vietnam should impose higher taxes on luxury items.
"We need long-term plans including income control, creating investment opportunities and encouraging savings to avoid a trade deficit," Cung said./.
