Vietnam’s deficit widens as domestic demand rebounds

The Vietnam trade deficit widened less than expected in the five months leading up to June and a rebound in imports hinted to some firming in domestic demand early in the second quarter of the year.

The General Statistics Office of Vietnam (GSO) said that for the January-May period, export revenue jumped 7.3% on-year to US$63.2 billion while imports increased 15.8% to US$66.2 billion, resulting in a widening of the trade deficit by US$3 billion.

Leading government economists had generally expected the trade deficit to rise by a substantially higher figure.

The increase in imports for the period – which reflected rises in industrial machinery, equipment and supplies in addition to consumer goods – pointed to some strengthening in domestic demand.