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Vietnam factory output up in Feb despite drop in smartphone production

Published 02/27/2023, 10:37 PM
Updated 02/27/2023, 10:50 PM
© Reuters. FILE PHOTO: Shipping containers are seen at a port in Hai Phong city, Vietnam July 12, 2018. REUTERS/Kham/File Photo
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HANOI (Reuters) - Vietnam's industrial output and exports rose in February from a year earlier, partly helped by higher footwear sales, in a possible sign of recovering global demand for goods produced in the Southeast Asian industrial powerhouse.

But indicating the caution among factory managers amid an uncertain global outlook, production of smartphones and cellphone parts, of which Vietnam is one of the world's biggest producers, fell despite a rise in exports.

The country's statistics agency said on Tuesday that Vietnam's exports rose 11% in February from a year earlier and industrial output increased 3.6% in the same month.

The rise in output in February follows an 8% year-on-year drop in production in January, when activity typically slows for the week-long celebrations for the Lunar New Year.

In the first two months of the year, industrial production was down 6.3% compared to the same period last year.

Smartphone output in the country which is home to major Samsung (KS:005930) factories was down nearly 10% on the year and the output of cellphone parts fell by nearly 15%.

Smartphone exports, however, were up 14,7%, in a possible sign that companies reduced their inventory in February.

Footwear production rose by nearly 19% in February on the year and exports climbed 4.1%, after a big fall in January. In the first two months of the year shoe exports were still down by 16% compared to the same period last year.

Taiwan's Pou Chen Corp, the world's largest maker of branded sports footwear and a top supplier to Nike (NYSE:NKE) and Adidas (OTC:ADDYY), plans to cut around 6,000 jobs in Vietnam due to weak demand, two local officials familiar with the company's plans said earlier in February.

© Reuters. FILE PHOTO: Shipping containers are seen at a port in Hai Phong city, Vietnam July 12, 2018. REUTERS/Kham/File Photo

In total, Vietnam's exports rose sharply in February to $25.88 billion, after a 21.3% fall in January.

With imports dropping in February by 6.7%, the country recorded a trade surplus of $2.3 billion in the month.

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