Vietnam says Q1 trade deficit hit $3.5 bln

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Vietnam on Friday said its trade deficit likely jumped to US$3.51-billion in the first three months of the year due to a pick up in imports as domestic demand picks up and the economy recovers.

In the March quarter, imports jumped 37.6 percent year on year to $17.52 billion, while exports fell 1.6 percent to $14.01 billion, the government's General Statistics Office (GSO) said.

The data comes as Vietnam struggles to rein in its deficit, which reached $12.2 billion in 2009, and in February Hanoi devalued its currency, the dong, for the second time in three months.

The first-quarter deficit contrasted with a surplus estimated at $1.6 billion in the first quarter of 2009 when imports plunged on weaker domestic demand and lower output during the global economic crisis.

Despite the global economic crisis, Vietnam's economy expanded 5.32 percent last year, but observers have expressed concern about the budget deficit and a return to higher inflation.

Vietnam's economy grew an estimated six percent in the first three months of the year, State Bank governor Nguyen Van Giau said this week.

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