Report of Department of Industrial Economy – Ministry of Planning and Investment in June 24th 2012.
1/ Overall situation:
The index of industrial production (IIP) in June 2012 increased 2.2% month on month and rose 7.8% year on year, of which the mining industry decreased by 1.3% while the manufacturing industry surged 4.3% and the electricity, gas and water production and distribution industry slumped 2.5%.
In the first six months of 2012, the IIP soared 4.5% over the same period, of which, the mining industry rose 3% (mainly because the crude oil and natural gas mining sub-industry added 7.5%, while the coal mining and hard coal collection sub-industry dropped 2.7%; the stone, sand, pebble, clay and kaolin mining sub-industry fell 22.1%, which is attributable to the fact that enterprises have scaled down their production to cut inventories, reducing the demand for these materials and moreover, legal documents guiding the auction of mining rights started to take effect, partially affecting mining reserves); the processing industry rose 4.3%; and the electricity, gas and water production and distribution industry climbed 10.8% over the same period last year.
Some industries recorded higher growth rates over the same period in 2011, including crude oil and natural gas, which rose by 7.5%; seafood and aquatic product processing and preservation by 9.9%; fruit and vegetable processing and preservation by 35.3%; butter and milk products by 20.2%; animal feed production by 14.6%; beer production by 10.5%; electricity production and distribution by 10.9%, drug, pharmaceutical and medicine production by 15.3%; and fertilizer and nitrogen compound manufacturing by 5.3%.
Certain sub-industries recorded lower IIP rates as compared to the same period last year, including hard coal mining and collection, which declined by 2.7%; stone, sand, pebble, clay and kaolin by 22.1%; textiles and fabrics by 10.3%; pulp, paper and paperboard by 2.1%; steel production by 4.1%; cement production by 5.9%; footwear by 1.2%; motor vehicle production by 6.1%; and motorcycle manufacturing by 3.4%.
2. The production of a number of major industrial products:
- Some products witnessed higher growth rates over the same period last year, including crude oil, which totaled 8.1 million tons, up 12.4%; natural gas 4.83 billion m3, up 4.4% ; liquefied petroleum gas (LPG) 315 thousand tons, up 2.6%; processed seafood 849.7 thousand tons, up 14.6%; milk powder 37.8 thousand tons, up 25.1%; cotton textiles 129 million m2. up 9.1%; adult leather shoes, sandals and boots 28.8 million pairs, up 21.6%; and chemical fertilizers 1.17 million tons, up 8.4% while washing machines was up 32.6%; electricity production up 14.8%; commercial water up 9.8%; beer up 5.3% and NPK fertilizers up 1.5%;.
- A few products posted lower growth rates over the same period last year, including coal, which reached 22.9 million tons, down 2.7% over the same period; chemical paints 142.3 thousand tons, down 12.3%; cement 27.3 million tons, down 5.9%; rebar 1.5 million tons, down 14.3%; automobiles down 11.4%; air conditioning down 46.1%; motorcycles down 1.7%; tires down 9.1%.
- As of June 1, 2012, the inventory index of the entire processing industry jumped 26% over the same period last year but dropped as compared to May 2012 (due to slow reduction in inventories).However, most of processing sub-industries recorded higher inventory indexes over the same period last year. The inventory index of the cement, lime and mortar production sub-industry was up 29.3%; fertilizer and nitrogen production: up 28.6%; malt and beer production: up 15.3%; clothing production: up 23.1%; motor vehicle production: up 116.7%; motorcycle manufacturing: up 25.7%; drug, pharmaceutical and medicine manufacturing: up 14.6%; packaging and crumpled paper production: up 130%; and plastic products: up 59.6%. On the contrary, inventories of the iron and steel manufacturing sub-industry decreased by 5.4% over the same period last year; sugar production by 26%; textile and fabric production by 4.6%.
3. Export-import in the first half of 2012:
a. Export
Total export turnover in June 2012 was estimated at US$ 9.75 billion, up 0.6% month on month; of which, export revenues generated by of foreign-invested enterprises (exclusive of crude oil) was estimated at US$5.25 billion.
In the first six months of 2012, total export value was estimated at more than US$53.1 billion, up 22.2% over the same period last year; export turnover of foreign-invested enterprises (exclusive of oil crude) was estimated to reach US$28.8 billion, representing a growth of 41.5% over the same period last year and accounting for 54.2% of the total export value.
The export volume of main commodities in the first six months of 2012 as compared with the same period last year: the export volume of crude oil was expected to reach nearly 4.2 million tons, up 6.7% in volume and 12.5% in value; that of coal was estimated at 7.74 million tons, down 13.1% in volume and 20.3% in value; the export value of textiles reached nearly US$6.8 billion, up 8.6%; that of footwear totaled more than US$3.5 billion, up 17.4%; that of timber and wooden products hit more than US$2.2 billion, up 24.5%; that of telephones and components neared US$4.7 billion, up 129.8%; electronic components reached nearly US$3.4 billion, up 84.9%; seafood US$2.9 billion, up 10%; rubber 407 thousand tons, up 41.3% in volume and 3.4% in value.
b. Import
Import turnover in June 2012 was estimated at US$9.9 billion, down 3.2% month on month, of which, import value of foreign-invested enterprises reached &US5.26 billion.
In the first six months of 2012, total import value hit US$53.8 billion, up 6.9% over the same period last year; foreign invested enterprises recorded an import value of US$ 28 billion, up 26.1%.
Import volume and value of some main items in the first six months of 2012 as compared to the same period last year are as follows: Gasoline: 4,800 thousand tons, down 21.1% in volume and 13% in value; iron and steel: 3.772 thousand tons, up 3.2% in volume and down 1.6% in value; fertilizers: 1,428 thousand tons, down 22.4% in volume and 10.4% in value; paper: 589 thousand tons, up 12.4% in volume and 7.4% in value; plastic materials: 1,247 tons, up 2.3% in volume and 1.7% in value; machinery: over US$7.7 billion, up 6%; computers and components: US$5.7 billion, up 97.7%; textile materials: more than US$1.5 billion, up 3% ...
4. Solutions and recommendations:
- To continue to monitor closely the progress of investment projects and the disbursement of projects. Projects, which have received funds in 2012 (including the State budget and Government bond capital) should quickly follow their schedule to meet the demand for funds of projects to be completed in 2012 and get prepare for the next year.
- To implement the State owned enterprise restructuring plan and strengthen management to improve the efficiency of state-run enterprises.
- Businesses need to maximize their production capacity and market demand in order to meet the economy’s demand for necessities such as power, coal, petroleum, fertilizers, construction steel, etc.; some consumer products, such as garments, footwear, milk, vegetable oil, and export products such as crude oil, garments, footwear, mechanical products, electrical wire and cable...
- To continue to promote technological innovation, strengthen management, research on the use of locally produced raw materials, supplies, machinery and equipment and at the same time drastically implement the National Energy Efficiency Program to reduce costs and lower product prices in order to improve investment, production and business efficiency;
- To continue introducing policies to reduce lending interest rates to encourage enterprises to make investments, produce and trade goods to meet local consumption and export demand./.
Ministry of Planning and Investment