Vietnam’s coal and crude oil imports surged in the first ten months of this year, government data released on Tuesday showed, highlighting the Southeast Asian country’s increasing reliance on imported energy to support its fast-growing economy.
Vietnam has one of the fastest growing economies in Asia, backed by robust exports and foreign investment. Economic growth this year is expected to surpass the government’s target range of 6.6%-6.8%, as the country benefits from the Sino-U.S. trade war.
The strong growth has boosted demand for coal. Imports of the commodity, mostly from Australia and Indonesia, during the January-October period more than doubled from a year earlier to 36.8 million tons, valued at $3.25 billion, the Customs Department said in a statement.
The imported coal will mostly be used for the country’s growing fleet of coal-fired power plants, which will still play a key role in its power generation mix for the years to come even as Hanoi promotes renewables.
The country’s crude oil imports rose 80.6% from a year earlier to 6.8 million tons during the period, the department said.
Once a key export earner for Vietnam, crude oil output of the country has been declining recently as its reserves fall at existing fields and as China’s increasingly assertive stance in the region hampers offshore exploration.
Government data showed crude oil output in the first ten months of this year fell 7.2% from a year earlier to 9.3 million tons. Meanwhile, its coal output rose 10.5% to 37.9 million tons.
The Ministry of Industry and Trade said in July that Vietnam will contend with severe power shortages from 2021 as demand outpaces construction of new plants, with electricity demand expected to exceed supply by 6.6 billion kilowatt hours (kWh) in 2021, and 15 billion kWh in 2023.
Vietnam will need an average of $6.7 billion a year to expand its annual power generation capacity by 10% between 2016 and 2030, the ministry had said.
Tuesday’s customs data also showed Vietnam recorded a trade surplus of $9.01 billion during the first ten months of this year, widening from a surplus of $7.24 billion a year earlier.