Trade powerhouse Vietnam reports surprise 5% fall in exports

Vietnam’s exports unexpectedly contracted in February, belying hopes of a quick turnaround suggested by the previous month’s data.

The value of overseas shipments shrank 5% from a year earlier, data released by Hanoi-based General Statistics Office showed Thursday, compared with the median estimate for a 1.7% increase in a Bloomberg survey of economists. Imports rose 1.8%, slower than the 7% expansion expected by analysts.

Trade-reliant Vietnam had initially reported a 42% increase in goods shipments last month, kindling hopes of a recovery in commerce. But lingering geopolitical tensions have, in part, dented early gains in global trade, with supply chain bottlenecks threatening to choke the recovery in exports. 

Consequently, the trade surplus narrowed to $1.1 billion in February from $2.92 billion a month ago. Exports account for about 100% of Vietnam’s economy, making it one of the most trade-dependent nations in the world.

Other data released Thursday also showed consumer prices gained 3.98% in February, faster than the median 3.4% gain seen by economists. Retail sales during the month grew 8.5% on-year, quicker than the 8.1% pace notched in January.