Vietnam's trade surplus significantly decreases by almost 60% during the initial four months of 2025

Rewritten Article:

Title: Trade Surplus Declines Sharply, as Smuggling Activities Ramp Up

Here's the skinny on the trade situation in Việt Nam during the first four months of 2025

Hanoi – The trade surplus in Việt Nam for the initial four months of 2025 took a substantial nose dive compared to the same period last year. According to the General Department of Customs under the Ministry of Finance, the country recorded a trade surplus of US$3.8 billion, a steep fall of 58.2 per cent from the $9.05 billion surplus in the same period of 2024.

The overall import-export turnover for the period reached approximately $277 billion, marking a yearly increase of 15.7 per cent or $37.5 billion. Exports rose by 13 per cent, while imports spiked by 18.6 per cent.

State budget revenue from import and export activities amounted to VNĐ142.1 trillion ($5.5 billion), representing 34.5 per cent of the annual target and a 12.1 per cent increase compared to the same period in 2024.

Despite the robust trade flow, customs officials have expressed concerns about the ongoing intricacies in combating smuggling, trade fraud, counterfeiting, and illicit goods transportation, particularly along prominent routes.

The majority of recorded violations stem from sea transport, accounting for 52.8 per cent of the total. High-profile seaports such as Đình Vũ, Nam Hải Đình Vũ, Tân Vũ, VIP Green, Cát Lái, ICD Phước Long, Hiệp Phước, Vict and Cái Mép have been repeatedly involved in cases of misdeclaration – including inaccurate names, categories, quality, customs values, tariff codes, and origins – aiming to circumvent taxes.

Air routes have seen an uptick in cases associated with the illegal transportation of narcotics, currencies, and gold. Offenders frequently abuse streamlined procedures, the growth of e-commerce, and the popularity of express delivery and goods consignment services to commit increasingly cunning violations.

Meanwhile, along land routes, the illicit trade and transport of firecrackers and white sugar have persisted, primarily in central provinces and along the Việt Nam-Laos border. Commonly smuggled items – often without legitimate invoices or documentation – include frozen food, consumer goods, and tobacco products, particularly at the Chinese and Cambodian borders.

Between January and April, customs officials uncovered and handled 5,206 violation cases, with an approximate value of VNĐ10.3 trillion (over $400 million). Administrative penalties contributed over VNĐ347 billion ($13.4 million) to the State budget.

This Is the Nitty-Gritty of the Challenges in Combating Smuggling

Sophisticated Schemes: Smugglers employ advanced tactics, taking advantage of streamlined procedures, rising e-commerce, and express delivery services to commit increasingly elaborate violations[2].
Mixed Bag of Goods: The assortment of smuggled goods – narcotics, currencies, gold, firecrackers, sugar, frozen food, consumer goods, and tobacco products – necessitates comprehensive surveillance and diverse detection strategies[2].
Border Issues: Smuggling across borders, particularly those with China and Cambodia, presents a substantial obstacle. The unlawful trading of goods without proper documentation complicates enforcement efforts[2].
Label Swindles: The fraudulent labelling of goods as Vietnamese-made poses another challenge, entailing complex verification processes to ensure compliance with legal regulations on product origin. Thorough verification and examination of existing regulations are crucial to reveal loopholes[1][3].
Logistical Hurdles: The overwhelming volume of goods passing through ports and other routes necessitates efficient and effective inspection processes to detect and prevent smuggling and trade fraud without stifling legitimate trade[3].

The trade surplus in the first four months of 2025 dropped sharply compared to the same period last year. - VNA/VNS Photo

Addressing these challenges demands heightened vigilance from competent agencies, including enhanced inspection and patrol efforts, reviews of regulatory frameworks, and increased cooperation with foreign countries to deter and punish fraudulent activities effectively[1][2].

Given the substantial decline in the trade surplus in the first four months of 2025, it is crucial that the Vietnamese finance industry increases efforts to combat the rampant smuggling activities.
The intricacies involved in curbing smuggling activities necessitate the implementation of advanced AI and data analysis tools to detect and prevent sophisticated schemes.
To address the problem of smuggling, it is essential to implement stricter procedures for trade activities, particularly at airports and seaports, to prevent the illegal transportation of narcotics, currencies, gold, and other contraband.
To deter smugglers evading taxes through misdeclaration of goods, the finance ministry should consider updating customs values, tariff codes, and origins to align with global trade standards.
Looking ahead to 2025, the industry must work towards increasing exports and reducing imports to ensure the country's trade surplus can recover and meet the annual target.

Vietnam's trade surplus significantly decreases by almost 60% during the initial four months of 2025