Vietnam Trade Deficit Grows To $4.7 Billion

Imports of machinery and equipment increased $46.5% as country builds up its infrastructure.

As it earned less from oil and rice exports and paid more for raw material and machinery imports, Vietnam's trade deficit grew to $4.78 billion in the first half of 2007 , the General Statistics Office (GSO) officials said June 25.

For the first six months, exports grew 19.4% year-on-year to $22.45 billion, but imports went up a steeper 30.4% to $27.23 billion.

In the six-month period, Vietnam -- a booming economy where the gross domestic product expanded 8.2% last year -- spent $2.15 billion on steel imports, up by 60.9% on the same six months last year.

"Demands for steel in Vietnam remained high," said a GSO official. "The situation won't improve any time soon as Vietnam is in the process of developing its infrastructure."

Vietnam's year-on-year imports of machinery and equipment went up by 46.5% to $4.39 billion, while fertilizer imports cost the rice-growing country $423 million, an increase of 24%.

In exports, the nation earned $3.43 billion from garment and textile exports, up 25.9%. Coffee earned the world's second largest exporter of the commodity $1.21 billion, up 108.9%.

Vietnam is the world's number two rice exporter but it earned less money from selling the grain, down by 5.6% to $731 million.

Between January and June, Vietnam -- which has sizeable offshore oil reserves in the South China Sea but lacks operating refineries -- saw crude oil export revenues fall 10.1% to $3.75 billion.

The country also saw industrial production rise to $17.23 billion, up by 16.9% year-on-year, said the GSO.

Copyright Agence France-Presse, 2007

TAGS: Trade
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