Comparing January 2023 to the same month the previous year, the industrial production index nationwide declined in 30 provinces while rising in 33.

Indicators in January showed some slight declines.

According to the General Statistics Office, the Lunar New Year of the Rat takes place in January 2023, the middle of the Tet holiday, so the number of working days is 8-10 days less than in the previous month and the same period last year. Many businesses boosted production last month to serve consumer demand during the Tet holiday, number of orders and the decrease in order size affected industrial production in January 2023.

Indicators in January showed some small declines. Additionally, according to international organizations, the global economy would likely experience an economic downturn and recession in 2023. The index of industrial production (IIP) is predicted to have declined by 8% from the same time last year and by 14.6% from the previous month in January 2023.

In particular, the production index for the processing and manufacturing sector fell by 9.1% in January 2023 compared to the same period in the previous year, reducing the overall increase by 7 percentage points; the mining sector fell by 4.9%, down by 0.8 percentage points; and electricity production and distribution fell by 3.4%, down by 0.3 percentage points.

Particularly in the water supply industry, the management and treatment of waste and wastewater increased by 3.7%, contributing 0.1 percentage points.

Production index in January 2023 of the number of key level II key industries decreased significantly compared to the same period last year: Manufacture of other means of transport (motorcycles and motorbikes) decreased by 27.1%; motor vehicle production decreased by 23.9%; apparel production decreased by 21%; electrical equipment production decreased by 19.1%; production of beds, cabinets, tables, and chairs decreased by 17.4%; metal production, leather production, and related products together fell 14.5%; paper production and paper products decreased by 13.6%; manufacturing machinery and equipment not classified elsewhere decreased by 12.1%; textile decreased by 11.8%.

In contrast, the industrial production index of some industries increased: Beverage production increased by 17.5%; exploitation, treatment, and supply of water increased by 5.9%; repair, maintenance, and installation of machinery and equipment increased by 3.8%

The industrial production index nationwide decreased in 30 localities in January 2023 compared to the same period the year before and increased in 33 localities, primarily as a result of the increasing and decreasing impact of the manufacturing, processing, and electricity generation and distribution sectors.

In particular, Vinh Long decreased by 22.8%; Vinh Phuc down by 28.7%; HCMC decreased by 21.4%; Dong Nai decreased by 15.7%; Binh Duong down 17.4%; Hanoi decreased by 23.2%; Ba Ria – Vung Tau decreased by 13.8%; Hai Duong down 20.2%; Quang Binh down 26.5%…

These are all localities with large-scale industrial production. When the industrial production index of these localities fell sharply, it affected the general industrial production index of the whole economy.

If considering the processing and manufacturing industry only, the General Statistics Office said, many localities saw a sharp decrease, mainly because businesses have not had orders. For example, Quang Nam decreased by 47%; Ha Giang down 32%; Soc Trang decreased by 31%; Vinh Long down by 25.5%; Vinh Phuc down 19.6%; Tay Ninh decreased by 16.7%; HCMC decreased by 15.6%; Dong Nai down 14.4%…

On the contrary, there are also some localities where the production index of the processing and manufacturing industry in January 2023 increased compared to the same period last year. For example, Tuyen Quang increased by 34.5%; Hau Giang increased by 10.5%; Phu Yen increased by 8.9%; Kon Tum increased by 7.8%; Nghe An up by 7%.

Besides, some key industrial products in January 2023 decreased significantly compared to the same period last year: Liquefied petroleum gas (LPG) decreased by 33.3%; motorbikes down 32.1%; automobiles down 31.7%; bar steel, angle steel down 26.2%; diameter reduced by 25.7%; rolled steel fell by 25.6%; television down 24%; casual wear decreased by 23.4%; chemical paint decreased by 14.6%; fabrics made from natural fibers decreased by 13.6%; cement fell 13.3%; Processed seafood and fresh milk both decreased by 9.4%. In the opposite direction, the number of products increased compared to the same period last year: Beer increased by 15.5%; powdered milk by 10.8%; commercial tap water increased by 5.9%; iron and crude steel increased by 4.3%; fabrics made from artificial fibers increased by 3.7%; petroleum increased by 3.1%.

Accelerate recovery and industrial development

To accelerate the development of industrial production in 2023, according to the Ministry of Industry and Trade, the Ministry will actively implement the Industry and Trade restructuring project. On that basis, develop industrial production in-depth to gradually create products with national brands and be competitive in regional and world markets, participate more deeply in the global value chain; focus on promoting industrial restructuring in the direction of increasing the proportion of processing and manufacturing industries and reducing the proportion of processing and assembling for industrial products manufactured in Vietnam. At the same time, review mechanisms and policies affecting industries and products. Gradually remove difficulties for businesses to increase competitiveness, build technical barriers for imported products to support domestic products, and increase localization rate

Specifically, according to the report of the Ministry of Industry and Trade on the Project on Restructuring the Industry and Trade sector for the period to 2030 sent to the Government, the growth rate of industrial added value reached an average of over 8.5%/year; The proportion of processing and manufacturing industry in GDP will reach about 30% by 2030.

The report also stated, focusing on developing the complete domestic industrial production system through upgrading and developing supply chains and industry value chains. Focusing on localization of supply chains of industries to reduce dependence on imported machinery, equipment, and raw materials and enhance autonomy, improve domestic added value and competitiveness of products, and the position of Vietnamese enterprises in the global value chain.

Mr. Pham Tuan Anh – Deputy Director of the Department of Industry (Ministry of Industry and Trade) said that the Ministry also directed and continued to remove difficulties for production and business enterprises, restoring production and supply chains; assisting enterprises in finding export and import markets for raw materials, fuels, spare parts and components for production. At the same time, implement solutions to develop industries according to established priorities: Developing basic industries such as mechanical engineering, steel, and electrical equipment…; some industries are internationally competitive and deeply involved in the global value chain such as Textile, garment, footwear, electronics… industry serving agriculture and rural areas; industry using energy economically and efficiently; industry serving security and defense; deep processing industry for agricultural, forestry and fishery products; the mining industry in the direction of only allowing the application of modern, economical, and environmentally friendly mining and mineral processing technologies, bringing about sustainable socio-economic efficiency.

In 2023, the Ministry of Industry and Trade will promote the development of human resources for industrial development, especially priority industries; accelerate the application of new and modern technologies, support enterprises to carry out digital transformation, and develop smart production in key, spearhead, and priority industries.

Source: Vietnam’s Ministry of Industry and Trade