Vietnam Economic News: 1.2 – 8.2.2025
Summary of Vietnam Economic News: 1.2- 8.2.2025
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Summary of Vietnam Economic News: 1.2- 8.2.2025 ---
Vietnam's exports down in January amid earlier Lunar New Year holidays
Reuters News – 6 February 2025
Vietnam's exports fell 7% in January from a year earlier as shipments may have been disrupted by Lunar New Year holidays that fell late in the month, data from the country's statistics office showed on Thursday. The country’s industrial hub still recorded a trade surplus of $1.23 billion in January, widening from $500 million in December. Its surplus with the United States, its top export market, narrowed by 3.5% to $8.5 billion in January compared to a year earlier, the statistics office said. Vietnam posted a record surplus with the United States in 2024. The earlier timing of the Lunar New Year holidays, which fell in February last year, may also have impacted industrial production as it posted a modest 0.6% rise in annual terms. The consumer price index rose 3.63% in January from a year earlier. The figures released on Thursday were in line with those published on the government's portal the day before. Retail sales rose 9.5% in January from a year earlier. Foreign investment inflows rose 2% in January from a year earlier to more than $1.5 billion, and foreign investment pledges rose an annual 48.6% to $4.3 billion.
Vietnam cuts gas, offshore wind targets in new power plan
Dow Jones Newswires – 5 February 2025
Vietnam has lowered its power-production targets for gas and offshore wind this decade, with coal and other renewables expected to fill the gap until nuclear reactors are included to the energy mix by 2035, a draft industry ministry document showed. The document, released late on Tuesday and still subject to changes, aims to replace the 2023 power generation plan for this decade. This comes as the country’s export hub strives to meet the growing electricity demand from domestic manufacturers and multinationals operating in the country. Under the revised plan, Vietnam will have no offshore wind project in place this decade, against an initial goal of installing 6 gigawatt (GW) by 2030, which has now been pushed back to 2035, in line with downbeat expectations in the industry. The installed capacity to convert gas into electricity will also be less significant than initially expected due to forecasted lower supplies of domestic gas and imported liquefied natural gas (LNG). Imports of LNG, which officials have said are part of ongoing discussions with the U.S. administration to avoid trade tariffs on Vietnam, are set to power production capacity of 18 GW by 2030, down from the 22.4 GW initially planned. Electricity production from LNG is set to begin this year, with the first power plants expected to come online, contributing a total capacity of 0.8 GW, according to the draft document. Developer PetroVietnam Power said last week two of the first LNG power plants with combined capacity of 1.5 GW will start commercial operations from June.
Supply chain firms face disruptions in Vietnam from stricter driving rules
Reuters News – 4 February 2025
Transport and logistics businesses in Vietnam reported disruptions in their operations and mounting costs caused by stricter traffic rules in force since the start of the year, according to a survey released on Tuesday. The new road safety regulations have steeply increased fines for serious road offences, such as ignoring traffic lights. More significantly for the logistics sector in the country’s industrial and export hub, they also mandate truck drivers to rest for at least 15 minutes after every four hours of driving. "Approximately 80% of businesses reported moderate to severe disruptions, particularly in long-haul transport," supply chains consultancy CEL said in a survey of 460 executives and staffers primarily from the logistics and distribution sector. The new limits on driving hours are in line with international standards. In the European Union, truck drivers are obliged to take breaks of at least 45 minutes after 4.5 hours of continuous driving. To comply with the new regulations, businesses are expected to increase their workforce leading to a rise in operational costs of up 20%, the report said, noting that 70% of the surveyed companies already reported a significant rise in their costs due to reduced driving hours and higher penalties. Transport costs tend to increase at the start of the year in Vietnam as traffic intensifies before week-long holidays for the Lunar New Year which this year fell at the end of January. Vietnam is home to large export-driven manufacturing operations of big multinationals, including Samsung Electronics, Apple and Nike. Strategically located on the southern border of China with over 3,000 km (1,864 miles) of coastline, Vietnam has a large industrial base, with significant clusters for clothing, furniture and electronics.
Vietnam to talk soon with foreign partners on nuclear power plants
Reuters News – 5 February 2025
Vietnam will hold talks with foreign partners this month about projects to develop its first two nuclear power plants, the government said on Tuesday. State utility EVN and oil and gas firm PetroVietnam have been assigned as the investors for the first two plants, the government said in a statement. It will discuss the projects with partners that include Russia, Japan, South Korea, France and the United States, according to state media. The country, a regional manufacturing hub, is seeking to boost electricity supplies to support its fast-growing economy, with a focus on cleaner energy. In 2009, Vietnam had approved plans to develop its first two nuclear power plants, but those were shelved in 2016 in the wake of the Fukushima nuclear disaster in Japan and due to budget constraints. The proposed plants, with a combined capacity of 4 gigawatts, were planned to be built by Russia's Rosatom and Japan Atomic Power Co in the central province of Ninh Thuan. Vietnam aims to complete the construction of the plants by the end of 2030, adding that the deadline is end-2031.