The HSBC Trade Confidence Index covers 6,390 exporters, importers and traders in 21 economies, including Australia, India, Hong Kong, mainland China, Singapore, the United Arab Emirates, Vietnam, Indonesia and Malaysia.

As per the latest reading, while 73% of the Vietnamese businesses surveyed expect to see their trade volumes grow or remain at current levels, this percentage is down from 80% of the previous survey.

In addition, local traders have a less positive outlook for the global economy than they did six months ago with only 34% anticipating any type of growth compared to 51% in the first half of 2012.

Like those in Indonesia, Vietnamese traders are moving away from relying on banks for trade finance with 37% indicating they want to fund their own financial obligations.

Intra-regional trade continues to be the core for Vietnamese importers and exporters, with China, Southeast Asia and the rest of Asia as their top three trading partners and each growing their share in Vietnam.

However, in the long term, the export-import outlook for Vietnam is relatively optimistic, according to the HSBC Global Connections Report – Vietnam released on Wednesday.

In contrast to most of its neighbors in emerging Asia, Vietnam maintained double-digit export growth in the first nine months of 2012, weathering the global downturn extremely well.

The report shows that the U.S. was Vietnam’s largest trading partner last year. Since signing a bilateral trade agreement with the U.S. in 2000 and joining the WTO in 2007, Vietnam has become the second largest supplier of clothing and footwear to the U.S. behind China.

Within the last few years, mobile phones and related accessories have become the second largest export item from Vietnam (after garments), accounting for more than 10% of exports. By 2013, the World Bank expects this category to have overtaken garments as Vietnam’s largest source of export revenue.

“Vietnam’s exports are expected to grow at a pace in excess of 10% out to 2030 with exports to the rest of emerging Asia, the Middle East and Africa all growing by double-digits,” says the report.

The report forecasts by 2030, China will have overtaken the U.S. as Vietnam’s largest export partner. However, the U.S., Japan and Korea will remain key sources of demand for Vietnam.

Plans to expand the ASEAN Free Trade Agreement to zero tariffs on all goods by 2015 will be an additional factor supporting Vietnam’s trade with other economies in the region over the medium term.

Export growth to Europe (excluding Russia) and to Australia, New Zealand and Oceania is expected to average around 9% a year from 2020 to 2030.

While enjoying strong export growth, Vietnam will be an increasingly large importer, both of capital goods to meet its large infrastructure needs and of consumer goods to meet the needs of its rapidly expanding consumer market, says the report. India, China and Bangladesh will be the fastest growing import partners of Vietnam in the decade to 2030.

By Hong Phuc - The Saigon Times Daily - November 15, 2012


Consumer confidence falls to three-year low

Viet Nam's consumer confidence index dipped 8 points to 87 in the third quarter of this year, marking the lowest confidence level since the first quarter of 2009, according to the latest findings from Nielsen, a global market research company.

According to the survey, conducted between August 10 and September 7, at least 73 per cent of Vietnamese said this was not a good time to make purchases.

Viet Nam, Hong Kong, Taiwan, South Korea and Japan were also the bottom-five countries and territories that were the least optimistic about local job prospects.

Ninety-one per cent of Vietnamese respondents reported change in their spending in order to save on household expenses. This rose from 86 per cent in the second quarter and 84 per cent in the first quarter.

As for the items that were cut back the most, 68 per cent of Vietnamese consumers pointed to gas and electricity, followed by new clothes (67 per cent), out-of-home entertainment (66 per cent) and telephone expenses (55 per cent).

With fuel prices rising five times within the third quarter; 24 per cent of Vietnamese respondents said utility bills (electricity, gas, heating) were their biggest concern. This was followed by the economy and job security at 20 per cent and 16 per cent, respectively.

Only 42 per cent of Vietnamese respondents believed their personal finances in the coming year would be good to excellent, down from 51 per cent in the second quarter.

Similarly, 40 per cent of Vietnamese online respondents believed their local job prospects would be good to excellent over the next 12 months, a drop of 6 percentage points from the second quarter and 18 percentage points since the beginning of the year.

"The subdued third quarter results reflected an overall trend that is neither positive nor negative as consumers are treading water very carefully," said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen.

Meanwhile, according to the survey, global consumer confidence increased one index point to 92 in the third quarter of this year, up four index points from the same period the previous year.

Nielsen's survey shows that North America and Europe reported the only quarterly consumer confidence increases, rising three index points to 91 and one point to 74, respectively.

The Asia-Pacific (100) and Middle East/Africa (98) regions remained flat in the third quarter, and Latin America fell two index points to 94.

Begun in 2005, The Nielsen Global Survey of Consumer Confidence and Spending Intentions, measures consumer confidence and major concerns and spending intentions of more than 29,000 consumers in 58 countries. The survey is conducted online.

Consumer confidence levels above and below a baseline of 100 indicate the degrees of optimism and pessimism.

Viet Nam News - November 16, 2012