The gap widened to US$11.1 billion compared with US$2.86 billion at the same time a year earlier, based on preliminary figures released recently by the General Statistics Office.

Imports climbed 71 percent to $29.36 billion, while exports rose 28 percent to $18.26 billion.

Import growth accelerated from a 63 percent rate through March.

“A developing country like Vietnam needs to import raw materials for production,'' said Tran Xuan Huy, chief executive officer of Saigon Thuong Tin Commercial Joint-Stock Bank (Sacombank), the only bank on the Ho Chi Minh City Stock Exchange.

“It's a temporary situation,” he said.

“In the long-run we should be able to make many of these products ourselves.''

The trade deficit is largely financed by short-term capital sources, leaving Vietnam vulnerable if such capital is withdrawn, said Le Xuan Nghia, director of the banking development strategy department at the State Bank of Vietnam.

“So far I don't see any evidence that the global downturn is causing a withdrawal of capital from Vietnam,'' said Huy of Saigon Thuong Tin, in a telephone interview late last week from Ho Chi Minh City.

“Maybe some foreign companies may have to restructure their operations and cut back a bit but most investors realize the opportunities in Vietnam are very big.”

Imports of machinery and equipment climbed 47 percent to $4.61 billion, while iron and steel purchases from abroad jumped 153 percent to $3.33 billion, the General Statistics Office said.

The purchase of petroleum products from overseas rose 8 percent by volume and 70 percent by value to $3.76 billion, as global crude oil prices have been on average about three-quarters higher so far this month than during the same period in 2007.

The International Monetary Fund last month cited the widening trade gap in saying recent tightening of monetary policy was appropriate.

Luxury car concern

The import of autos and auto parts surged 333 percent to $991 million.

Growing imports in Vietnam of goods like luxury cars are a concern, World Bank economist Martin Rama said in an April 7 report.

The higher oil prices benefited Vietnam's exports of crude oil, which rose 46 percent by value to $3.5 billion even while slipping 10 percent by volume.

Vietnam is Southeast Asia's third-biggest oil producer with output averaging 300,000 barrels per day.

Garment exports jumped 25 percent to $2.61 billion.

Vietnam may pass India and Mexico to become the second-biggest supplier of garments to the US this year, according to a posting on the website of the American Chamber of Commerce in Vietnam.

Footwear shipments advanced 16 percent to $1.36 billion, while seafood exports rose 14 percent to $1.15 billion.

“Demand for seafood is better than last year, and we are expecting export prices to increase,'' said Nguyen Xuan Hai, deputy director of Cuu Long-An Giang Seafood Export-Import Joint-Stock Co., in an interview late last week from the Mekong Delta Province of An Giang.

“We just found one partner in New Zealand and another in Saudi Arabia.”

Exports of rice climbed 12 percent by volume to 1.56 million tons, and surged 73 percent by value to $775 million.

“Contracts for the entire year's exports are often signed within the first two quarters of the year, locking in prices,'' the agricultural attaché’s office at the US Embassy in Hanoi said, in an April 6 report on Vietnam's rice industry.

Source: Bloomberg