Vietnam’s index of industrial production (IIP) records a year-on-year rise of 9.13 percent in the first six months of this year. (Photo: VNA)Hanoi (VNS/VNA) – Vietnam’s index of industrial production (IIP) recorded ayear-on-year rise of 9.13 percent in the first six months of this year,according to the General Statistics Office (GSO)’s latest report.
The indexwas lower than 10.3 percent seen in the same period last year but higher than 7percent and 5.4 percent in the corresponding periods of 2016 and 2017,respectively.
Theprocessing and manufacturing sector, which accounts for nearly 80 percent ofdomestic industrial production, reported the strong IIP increase of 11.2 percent– a highlight that led the growth of not only the sector but also the wholeeconomy in the period, according to GSO Director Nguyen Bich Lam.
Meanwhile,the IIP growth of electricity production and distribution stood at 10.6 percentand that of water supply and waste-sewage treatment sector and mining sectorreached 7.8 percent and 1.8 percent, respectively.
Someindustries achieved high production growth in the first half of this year, suchas coke coal and refined mining products (70 percent), metal (40 percent), oreexploitation (18 percent), motor vehicles (12 percent) and textile and garment(11 percent).
Among keyindustrial products with strong IIP increases included crude iron and steel (60percent), petroleum (58 percent), paint (15 percent), feed for aquaculture (14 percent)and handsets (14 percent), according to the GSO.
FromJanuary to June, a number of localities that posted significant growth in IIPlike the northern port city of Hai Phong with 25 percent and three otherprovinces of Quang Ninh, Vinh Phuc and Hai Duong in the north with 14 percent,13 percent and 10 percent, respectively.
Otherswere the southern province of Dong Nai with 9 percent while the twolargest economic hubs of Hanoi and Ho Chi Minh City lagged behind, recordingIIP rises of nearly 8 percent.
Accordingto GSO statisticians, in addition to accelerating production, the industrialsector needs to speed up local consumption of goods in the latter half of thisyear as the inventory index of the processing and manufacturing sector remainedat 75 percent in the first six months, much higher than the safe inventoryindex at about 65 percent.
Junecompleted a solid second quarter for the Vietnamese manufacturing sector,with business conditions improving amid the ongoing growth of neworders.
A surveyby Nikkei and IHS Markit released on July 1 showed the VietnamManufacturing Purchasing Managers’ Index (PMI) was 52.5 in June, up from 52.0in May and in line with the reading from April. The average PMI reading for thesecond quarter of 2019 was above that seen in the opening three months of theyear, albeit remaining short of the 2018 average.
Accordingto the survey, Vietnamese manufacturers continued to record solid growth of neworders in June, with the rate of expansion ticking up to a six-month high.Panellists linked the latest rise to the launch of new products and increasedcustomer numbers. Less positive data was seen with regards to new exportorders, which rose at the slowest pace since February. There were some reportsthat US-China trade tensions had negatively impacted export orders.
Thehigher number of new orders was the key factor leading to anineteenth successive monthly rise in manufacturing production in Vietnam. Therise in output was solid, and broadly in line with those seen during the restof the second quarter.
Thecontinued new order growth led to a rise in backlogs of work in June, the firstin 2019 so far. Firms responded to higher workloads by taking on extra staff,reversing the decline seen in May.
“TheVietnamese manufacturing sector continues to bob along nicely midway through2019. The second quarter of the year saw solid growth that was broadly stableacross the period and an improvement on the first quarter,” said Andrew Harker,Associate Director at IHS Markit, adding that ongoing strength in demandencouraged firms to fill positions that had been vacated by resigning staff inMay, leading to a return to job creation.-VNS/VNA
