VN looks to increase exports to Middle East

Trần Quốc Khánh, the Deputy Minister of Industry and Trade, spoke to Thời báo Kinh tế Việt Nam (Viêt Nam Economic Times) about what Vietnamese exporters should do to secure a firm foothold in foreign markets. Some people have expressed worry that our non-tariff barriers to trade are not strong enough to help Vietnamese goods compete against foreign made goods in our domestic market. How do you respond to this complaint? All Vietnamese enterprises want strong non-tariff barriers to trade in the competition with the influx of foreign made goods in our territory. But that is not a good approach. We accept decreasing tariff barriers to allow fair competition with foreign commodities. We don't have any intention to introduce preventive measures to limit the flow of foreign commodities into our country. This is a philosophy of Free Trade Agreements (FTAs). As a signatory to several FTAs, we have committed to not introducing any trade barriers to limit the flow of foreign made products into our country. But under the FTAs, all countries have the right to introduce measures to protect their consumers' health, animal welfare, plants and the environment. Under the FTAs, all countries are allowed to adopt their own measures to protect the environment, ensure healthy competition and fairness, such as anti-dumping measures, preventive measures and anti-subsidization policy. Such measures have already been applied by our government. Preventive measures have become the biggest worry of Vietnamese exporting firms. The European market has adopted very strong non-tariff barriers to trade…... [read more]

HA NOI (VNS) — Vietnamese export firms have mixed feelings, both happy and worried, about business prospects for this year. The Hoang Son I Limited Company in the southern province of Binh Phuoc signed a cashew export contract until May this year, according to Ta Quang Huyen, director of the company. "The world market is consuming Vietnamese cashews with export prices rising from VND72,800 per kilogramme to VND78,400 per kilogramme," Huyen told the Phap Luat Thanh Pho Ho Chi Minh (HCM City Law) newspaper. The output of Vietnamese cashews has been getting better, even in choosy markets such as Japan and the US, the director added. However, large export contracts also make enterprises worried. "The company does not dare to sign contracts with large volume because we are worried that there will be not enough raw cashews to meet the signed orders," Huyen said. Huyen said the domestic raw cashews could supply only 30 per cent of the demand for export processing. Responding to this issue, Nguyen Duc Thanh, chairman of the Viet Nam Cashew Association (Vinacas), said Viet Nam could process about 1.3 million tonnes of cashews each year, however, the country could supply only 500,000 tonnes, with the rest imported from Africa and Cambodia. Meanwhile, the export of dragon fruit in the beginning months of this year has also been smooth, according to Tran Ngoc Hiep, director of the Hoang Hau Dragon Fruit Farm Co, Ltd. Besides the key market of China, the company expanded its exports to…... [read more]

HCM CITY (VNS) - Vietnamese export firms need to improve their awareness and preparations to cope with the World Trade Organisation's trade defence that allows importing countries to take action against exporting nations, a senior official said. Speaking at a seminar in HCM City yesterday on "Sharing experiences on how to cope with and take advantage of the WTO's trade defense and dispute settlement mechanism," Nguyen Phuong Nam, deputy head of the Ministry of Industry and Trade's Competition Department, said: "Knowledge of the WTO's trade defence is very important for export firms to reduce risks and losses in the international trading environment." The WTO recognises three principal trade defences - anti-dumping, anti-subsidy, and safeguard instruments. Anti-dumping is designed to allow countries to take action against imports that cause or threaten to cause material injury to the domestic industry. Anti-subsidy measures allow importing countries to take action against certain kinds of subsidised imports. "Subsidies" are defined as financial assistance from a government to a company. Safeguard measures are defined as "emergency" actions with respect to increased imports of particular products, where such imports have caused or threaten to cause serious injury to the importing member's domestic industry. Since 1994 Viet Nam has come up against 80 lawsuits under the WTO's trade defence provisions, a fifth by the US and 22 per cent against the steel industry. "Because of limited financial and human resources, export firms have limited knowledge of the law and always suffer very big losses in the long term,"…... [read more]

by Thien Ly Both domestic and foreign firms have called for lifting restrictions on advertising and promotional spending to mitigate the economic gloom. The Corporate Income Tax Law caps spending on advertising and promotion at 10 per cent of total costs for businesses that are three years old or less. Any spending above the 10 per cent limit s not tax deductible. The Ministry of Finance is set to suggest increasing the cap to 15 per cent in a draft amendment to the Corporate Income Tax Law. The ministry has explained in the past that the restriction is aimed at protecting domestic firms from foreign rivals with deep pockets. Its proposal now to merely raise the cap rather than scrap it has made both Vietnamese and foreign firms unhappy. The restriction is particularly unwelcome for them in the context of Viet Nam's global integration and fierce competition. For domestic firms, it has been a dampener on investment decisions at home and abroad. Another casualty of this cap is the ability of the country's firms to promote the "made in Viet Nam" brand name. But the limit has not dissuaded businesses from pumping money into advertising. According to TNS Viet Nam, a subsidiary of the world's largest custom research company, advertising spending has almost doubled from VND9 trillion in 2008 to VND17.2 trillion ($826 million) in 2011 despite the economic downturn. Thus, even if the cap cannot be scrapped immediately, not only should it be increased to 15 per cent as…... [read more]

The Hanoitimes - Firms are pinning hopes o­n the outcome of Vietnam-EU free trade agreement (FTA) negotiations slated to take place early next month.Addressing a forum in Hanoi o­n September 21 to discuss Vietnam and ASEAN's trade integration with the EU, head of Ministry of Industry and Trade (MoIT)'s Multilateral Trade Policy Department Luong Hoang Thai said the FTAs, either setting o­n regional or country basis, looked at fostering international integration and bringing practical benefits to relevant countries and enterprises."If the FTA between Vietnam-EU was inked, at least 90 per cent of Vietnam's export items bound to EU market would become tax free, paving the way for made-in-Vietnam products to strongly make inroads in EU's 27 member countries' markets," Thai said.MoIT figures show that in 2011, Vietnam was EU's firth largest trading partner among ASEAN countries, with bilateral trade turnover reaching 18 billion euros, of which Vietnam exported to EU12.8 billion euros and imported from EU 5.2 billion euros.In the year ending July, the EU was Vietnam's second largest export market with a total export value of $11 billion, making up 17.1 per cent of the country's total export value.According to head of EU delegation in Vietnam Franz Jessen, the signing of FTA would have positive impacts o­n both sides' economies. Vietnamese export firms would step into EU market more easily whereas EU products flowing into Vietnamese market would fuel competition in the home market and consumers would be major beneficiaries."The signing of the FTA with EU will help the…... [read more]

Finding fast routes into the US market remains a vexed question. With around 310 million multi-cultural population, per capita GDP averaging $48,000 per year and less demanding consumers compared to those in EU and Japan, the US was a potential export market not only to Vietnamese firms but also to businesses in countries around the world, said Ministry of Industry and Trade (MoIT) American Market Department head Nguyen Duy Khien. In 2011, the US spent more than $2,300 billion on importing commodities, almost double Germany's total import value and triple that of Japan. With such a tremendous demand and lucrative market pattern, US market remained one top target to any exporter, said Vietnam Trade Promotion Agency's Export Support Centre director Nguyen Xuan Duong. Khien said Vietnamese exports bound for the US market faced stiff competition, particularly from Chinese-made items in respect to key export items like footwear, textiles-garments, electronic, seafood, plastic and wooden products. Besides, high transportation and transaction costs, long travel distance and fewer tax incentives are other disadvantages Vietnamese exports are suffering. In addition, local firms are mostly small in size with little brand value. "Around two million US-based overseas Vietnamese (Viet Kieu) community will be an important bridge to deepen the presence of made-in-Vietnam products in US market," said Duong. Handicraft maker Doi Moi Company is one typical example of making an effective use of Viet Kieu support to bring its products to US consumer hands. "Through support by some Viet Kieu, from 2002 our company began…... [read more]

by Xuan Hiep HCM CITY — HCM City's bilateral trade with Australia and New Zealand has increased significantly, after more than two years of implementation of the ASEAN Australia New Zealand Free Trade Agreement, according to the Department of Industry and Trade. A processing line at Dau Tieng Rubber Company under the Viet Nam Rubber Group. The company's latex has been exported to several countries including Australia and New Zealand. Many Vietnamese exports have become more popular with Australian and New Zealand consumers. — VNA/VNS Photo Phuong Vy Many Vietnamese exports to the two countries recorded high growth after the two countries reduced import taxes to zero per cent in 2010 under the trade agreement, according to the department. Total import-export value between HCM City and Australia reached US$840.2 million last year, a surge of 59 per cent compared with $529 million in 2009. In particular, exports of cashew nuts reached $22.7 million, an increase of 25.9 per cent; textiles and garments, $22.4 million, a jump of 19.2 per cent; and footwear, $19.9 million, an increase of 36.1 per cent. Seafood reached $18.9 million, an 18.7 per cent increase; and wood and products made of wood, $16.7 million, a 37.7 per cent increase. Meanwhile, total import-export value between the city and New Zealand reached $182.8 million, more than double of $87.6 million in 2009. In particular, exports of cashew nuts to New Zealand reached $25.49 million, a rise of 245 per cent; footwear, $3.8 million, an increase of11.1 per cent;…... [read more]

The Hanoitimes - Vietnam can avail of many opportunities to promote exports to Japan, particularly in garments, steel, wood decorative items, agricultural products and footwear, said Vo Thanh Ha, deputy head of the Asia Pacific Market Department at a conference organised by Vietnam Trade Promotion Agency o­n May 22. Japan provides favourable legal and economic conditions for Vietnamese enterprises to enter this highly potential market. To promote exports to Japan, Vietnamese firms should timely grasp market information and understand the business habits of Japanese companies. They should take full advantage of support channels in Vietnam and Japan, and enjoy the preferential treatment brought about by bilateral and multilateral trade agreements. In addition, Vietnamese export firms should respect and follow all norms of regulations and food safety and hygiene standards. KTD... [read more]

Industry experts are mulling ways to boost Vietnam's exports in 2012. Deputy Minister of Industry and Trade Nguyen Thanh Bien said a tough world economy in 2012 would challenge Vietnam's trade promotion, while dampening export performance of Vietnamese firms. "The price of exported rice soared one month ago due to scarce supply. However, competition from rice exporting countries like India has tumbled the world price, hurting Vietnam's rice exports," said Bien. According to Vietnamese trade counselor in Japan Vu Van Trung, the image of made-in-Vietnam goods in Japanese market was stained due to a group of small firms having poor knowledge about the Japanese market. "These firms will struggle to survive in 2012," said Trung. In respect to next year's exports, Trung confirmed Japan would have tremendous demand for import in 2012 to resume production and rebuild areas which were hardly hit by disastrous earthquake and tsunami in early 2011. Japan is loosening protectionism towards imported agricultural products and shifting into importing products from other countries rather than China on the back of worsening Chinese products' comparative advantages due to rising labour cost and quality problems in this country. "Vietnamese export firms need to make the most of the Vietnam-Japan economic partnership agreement, effective from October 2009, which saw 84.6 per cent of Vietnamese exports to Japan become tax free during 10 years since the enforcement, paving the way for the country's exports to carve a niche in the Japanese market," Trung added. Vietnam trade office in the US's minister-counselor…... [read more]

The export value of Vietnam’s products to countries in Africa, Western Asia and Southern Asia was posted at US$1.3 billion in 2005, up 30 per cent over the previous year, of which the African market obtained a recorded increase of 84 per cent, accounting for more than US$660 million, according to the Department of Africa, Western Asia and Southern Asia under the Ministry of Trade. Though the figure holds a small ratio in Vietnam’s total export value, these foreign markets, incorporating more than 80 countries, are drawing increased attention from both the Government and enterprises within Vietnam. Vietnamese products are available in almost African, Western Asian and Southern Asian countries, including the major exports of rice, coffee, TV and electronic products, garments, footwear, plastic products, furniture, tea and pepper. Vietnam annually ships around 1.8-2 million tones of rice to the markets, however, most shipments are made via companies in third countries because the importers are not able to make large payments of US$3.5-4.5 million on each shipment immediately. Over the last two years, garment and footwear products have recorded high annual growth, with 60 per cent and US$50 million in export value and 30 per cent and US$50 million, respectively, although they have to face fierce competition on similar exports from China. Sport shoes, cloth shoes, all kinds of shoes for children, slippers and beach sandals are familiar in these markets but leather shoes have not made an appearance. To expand exports to these long-distance but potential markets, the Department…... [read more]

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