CHEMICAL INDUSTRY REPORT: 2022 OVERVIEW

According to the Industry and Trade Information Center (VITIC), in 6 economic regions across the country, there are over 1.81 thousand chemical manufacturing enterprises, of which 894 are fertilizer producers, and 106 are chemical enterprises. production of plant protection chemicals, 68 enterprises producing basic chemicals, 14 enterprises producing petrochemical products, etc. 

The chemical industry currently provides jobs for 2.7 million workers, of which 725 thousand are directly involved in the production of chemicals and chemical products.

Data from the General Statistics Office shows that the chemical industry is still maintaining good growth with bright spots in both production and consumption. 

Particularly in the first 6 months of 2022, the industrial production index of the chemical and chemical product manufacturing industry increased by 3.5% over the same period last year, in June 2022 alone, an increase of 7.4% compared to the original average month of 2015. 

In which, production of cosmetics, soaps, detergents, polishes, and hygiene products increased the highest by 7.7% compared to the first 6 months of 2021, in June 2022 increased by 20.7% compared to the average month. army base year 2015; followed by plastic and synthetic rubber production in primary form with 3.8% compared to the first 6 months of 2021, in June 2022 an increase of 60.6% compared to the base month of 2015.

Besides, as a product included in the list of industries with export turnover of billions of USD, in 2021, chemical exports have rebounded with a spectacular increase after a decline in 2 years 2019 and 2020 because of the effect of the COVID-19 pandemic. 

According to the International Trade Center (ITC) assessment, in the period 2016 - 2020, some key export chemical products of Vietnam achieved higher growth rates than the world's import growth rate in the same stage. 

In particular, artificial corundum, whether or not chemically defined; as aluminum oxide; or aluminum hydroxide achieved average export growth of 23% in the period 2016-2020. Meanwhile, world imports during this period only increased by about 8%. 

In addition, Vietnam's exports of hydrogen, rare gases, and other non-metals increased by 5% during the above period while the world's exports decreased by 6%. 

In the coming time, chemical exports will have many opportunities to improve export turnover to the European Union (EU) thanks to the impact of the tax rate gradually reducing to 0% in the EU-Vietnam Free Trade Agreement (EVFTA). 

Chemical products that Vietnamese enterprises can take advantage of opportunities thanks to EVFTA include Basic chemicals and detergents. Specifically, under the EVFTA, for laundry detergents (HS 3402), the tax rate will be adjusted from 4% to 0% as soon as the Agreement comes into effect; For phosphorus products (HS 2804 7000), the tax rate will also be reduced from 5.5% to 0% as soon as the EVFTA comes into effect.

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