The country’s industrial production increased 5.1 per cent during the first seven months of the year over the same period last year, reaching 382.7 trillion dong (US$21.5 billion), the General Statistics Office reported.
With the monthly increase of 7.5 per cent, July was the fourth consecutive month in which the country’s industrial production surged, with rates ranging between 5.4 and 8.2 per cent. The country suffered a decline in industrial production in the first quarter.
Director of the GSO’s Industrial and Construction Department Pham Dinh Thuy attributed the increase to a domestic consumption recovery which has encouraged investment in domestic production.
Thuy said the domestic market had high potential, helping counter-balance the shrink in export markets.
In the first seven months, private firms were reported to have had the highest growth rate of 7.4 per cent, contributing 35.6 per cent to the country’s total industrial production value.
Foreign invested firms followed with a growth rate of 5.3 per cent. Industrial production by State-owned firms, meanwhile, increased only 1.5 per cent.
A number of key industries had a significant surge in the first seven months. Air conditioner output reached 350,100 units, up 56.7 per cent; the cement industry churned out 26 million tonnes, up 23.6 per cent; production of fridges, crude oil and footwear increased between 17.1 per cent and 20.8 percent.
The GSO warned however that the growth of the industrial sector remained unsustainable, with many industries reporting decreases in the first seven months. For example, seafood processing declined 8.3 per cent and sugar, paper and ceramic production were down between 6.9 per cent and 21.4 percent.
The Government this year approved a growth rate target of 10 per cent for the industrial sector which calculates to production totalling 711 trillion dong ($42 billion).
To meet the target, the sector will have to achieve a 13.4 per cent growth rate in the second half of the year to compensate for the modest increase in the first half, which deputy minister of Industry and Trade Bui Xuan Khu said would be difficult, especially with the global recession still having a significant negative impact.