Vietnam, Ukraine Establishing Alliance on Economic Front

In his opening speech, Mr Tran Quoc Khanh, Deputy Minister of Industry and Trade emphasized that the Government of Vietnam and Ukraine have long-standing traditional friendship and have signed several trade and investment cooperation documents which laid the groundwork for economic cooperation between the countries. With great consumption capacity and qualified banking system of international payment, Ukraine is evaluated as a good potential market for Vietnam. In addition, the structure of import and export items of Vietnam and Ukraine are complementary to each other, which is convenient for two countries to promote trade exchange and lift trade cooperation to a strategic partnership.

 

Currently, Vietnam goods initially established a foothold and reputation for Ukrainian consumers. Vietnam mainly exports to Ukraine seafood, agricultural products, handicrafts, timber, textiles, leather and imported steel, machinery and equipment, chemicals and fertilizers for agricultural production. In 2011, Vietnam-Ukraine trade turnover reached nearly US$300 million. For eight months of 2012 alone, the turnover was US$175 million, up 17 percent over the same period in 2011. Exports of Vietnam and Ukraine reached US$132 million and US$ 43 million, up 16 and 21 percent over the same period last year, respectively.

 

However, according to Deputy Minister Tran Quoc Khanh, although Vietnam and Ukraine bilateral trade has achieved rapid growth over the past time, it remains quite modest compared to the potential for cooperation between two countries. Bilateral trade turnover accounts for a low proportion in the structure of economic cooperation. Mr Khanh gave a specific example on the textile import-export to illustrate this situation. Each year, Ukraine needs to import nearly US$2 billion for textiles, while in the first eight months of 2012, Vietnamese textile and garment exports to this potential market were estimated at only around US$14 million. Ukraine has a great import demand for not only textiles but also for footwear, coffee and tea, while Vietnam’s enterprises are able to offer a negligible volume.

 

Particularly in the field of investment, direct investment in the territory between the two countries is very modest. In 2011, Ukraine has 10 projects in Vietnam with a total registered capital of nearly US$23.3 million, ranking 59^th out of 92 countries and territories having investment in Vietnam. In return, Vietnam has five investment projects in Ukraine with a total investment of only about US$3 million.

 

According to the Chairman of Anti-monopoly Committee of Ukraine, Ukraine has always seen Vietnam as one of the most important partners in ASEAN. There are plenty of potential cooperation opportunities for Ukraine and Vietnam, and business communities of two countries need to actively and closely work with each other to fully exploit these potentials. Vietnam and Ukraine should become allies, together strengthening the traditional relationship and establishing economic, trade and investment relations. Vietnam can act as an intermediary sales partner of Ukraine, undertaking the role of selling Ukrainian goods in the ASEAN market. In return, Ukraine can act as an intermediary partner of Vietnam, getting Vietnamese goods consumed in the Eastern Europe market. Mr Vasy Tushko stressed: “Only when two countries become allies with mutual support and cooperation can Vietnam and Ukraine insure their standing in the international market."

 

To tighten friendship and cooperative relations between two countries, the Ukraine Chamber of Commerce and Industry has established the Vietnam-Ukraine Business Council. Joining this council, two countries do not have to pay any fees and will be provided market information, partner information, advice and support to solve problems in business operation.