Vietnam’s Trade Promotion Department praises ASEAN’s export opportunities

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HANOI (Vietnam News/Asia News Network): Vietnamese companies have many opportunities to increase exports of goods to Thailand, Laos and Cambodia, according to the Trade Promotion Department of the Ministry of Industry and Trade.

Nguyễn Thị Thu Thủy, deputy director of the Export Support Center, said Vietnam has many favorable conditions for exporting goods to Thailand and Laos because the three countries are geographically close and are members of different free trade agreements.

In order to meet the demand of customers in Thailand and Laos, local companies are recommended to export goods that meet technical standards and have official import certificates.

They also have to apply advanced technology in the processing and preservation of products to ensure the quality of the products.

You should attend fairs and exhibitions to promote products and find suitable partners, as well as connect with Vietnam Trade Office in Thailand and Laos to get market and partner information and dispute assistance from the office.

At the same time, companies must build a brand of Vietnamese goods with high quality and competitive prices, according to the Ministry of Trade Promotion.

Lê Thị Phương Hoa, trade adviser to the Vietnam Trade Office in Laos, said Laos is a simple market that imports most consumer goods.

Also, this market helped Vietnam export goods to several neighboring countries, including Thailand. In particular, in the cooperation in the transport sector from 2021 to 2025, there was the Hanoi-Vientiane railway line.

These are favorable factors to export Vietnamese goods to Laos more cheaply and quickly. However, companies should note that goods exported to Laos require Lao language labels.

Also, Vietnamese goods are competing with counterfeit goods and cheap goods from China, Hoa said.

In Laos, Thailand’s sales and marketing strategies have been very flexible, with a professional sales channel. Meanwhile, Vietnamese goods were only sold in small shops.

Hoa said one of the Vietnamese companies is developing a supermarket chain in Laos, but they still sell Thai products to keep operations and development going. This meant that Vietnamese goods had to compete with Thai products.

Many Vietnamese used to do business in Laos, a channel for selling Vietnamese goods, but the Covid-19 pandemic made them return home. If the pandemic is under control, they might not be able to return to Laos due to the high cost of entry and living.

On the other hand, the Russia-Ukraine conflict and rising fuel prices in Laos led to rising consumer prices and inflation. These factors will make it more difficult to export Vietnamese goods to Laos in the future.

According to the Vietnam Trade Office in Laos, trade turnover between Vietnam and Laos has been growing in recent years. Bilateral trade value growth increased from 8 percent in 2017 to 13.6 percent in 2021, reaching $1.4 billion.

In the first five months of 2022, the trade value increased by 21 percent to $700 million. This figure for all of 2022 is expected to reach the same value in 2021, maybe even more.

Meanwhile, food in Thailand is a potential commodity for Vietnamese exporters due to high demand.

In the structure of imported food products to Thailand, Vietnam accounts for 6 percent of the market share, a small number compared to 40 percent of US food and more than 40 percent of New Zealand food.

According to Nguyễn Thanh Huy, head of Vietnam’s trade office in Thailand, Thailand is an agricultural country, so Vietnamese agricultural products have to compete with the same products from Thailand.

Food and processed products are also the target segments of Vietnamese companies, but there is fierce competition for these products among exporters.

Also, Thailand has strict standards for the food industry, so it’s not easy to import. Vietnamese companies without specific product and market strategies will find it difficult to compete in this market.

On the other hand, Vietnamese companies should study the market carefully as distribution channels in Thailand are very diverse, including traditional markets, convenience stores, supermarkets and hypermarkets.

They must also prioritize healthy foods that are low in sugar and fat, and pay special attention to the shopping habits of Thai customers on e-commerce platforms.

In the first five months of 2022, the total trade turnover between Vietnam and Thailand reached $8.61 billion, up 8 percent. Thailand is now Vietnam’s largest partner in the ASEAN region. The two countries have set an export value target of US$25 billion by 2025.

Vietnam now exports phones and electronic components; Machinery, equipment, tools, spare parts, textiles, garments and seafood to Thailand.

market in Cambodia

Lê Hoàng Tài, deputy director of the Department of Trade Promotion at the Ministry of Industry and Trade, said Cambodia is a potential market for Vietnamese companies.

The two countries had developed open strategies to create favorable conditions for trade activities, but in order to increase exports to Cambodia, local companies had to study this market carefully in order to increase their market shares.

According to Phan Văn Trường, Head of Vietnam Trade Office in Cambodia, Việetnam and Cambodia share many similar characteristics in terms of culture, market demand and consumption habits. They are favorable factors to help Vietnamese goods import to Cambodia.

In addition, both are members of ASEAN and benefit from regional commitments such as the ASEAN Trade in Goods Agreement (ATIGA). This creates opportunities for investors from Vietnam, Cambodia and other regional countries to expand investment and value chain development for export goods to ASEAN countries.

Mai Thị Kim Anh, an agricultural company representative, said most companies exporting to Cambodia face difficulties in customs clearance at the Việt Nam border gates.

The biggest obstacles were often the change in procedures and operations, while the working time to carry out customs clearance was only from 1:00 p.m. to 4:00 p.m.

Kim Anh said state administrative agencies must help companies update sufficient information in order to smoothly export goods to this market. Working hours should be regulated from 8 a.m. to 5 p.m.

In 2021, Vietnam’s export turnover to Cambodia will reach US$4.8 billion, up 15.7 percent from 2020.

In the first five months of this year, exports to Cambodia totaled $2.6 billion, up 31.2 percent from the same period last year.

The main export products from Vienam to Cambodia include iron and steel, chemicals, plastics, machinery and electrical equipment, processed foods, confectionery and grains.

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