American Market: Promising for Vietnam
On March 8, 2005, VCCI Ho Chi Minh Branch and the US Consulate General organised a seminar introducing the American market to some 200 Vietnamese businesses. The seminar provided useful information to Vietnamese businesses on entering the world’s most promising market.
Initial success
According to the statistics of the US Customs Office, in 2004 Vietnamese exports to the United States posted US$5.16 billion or 15.4 per cent more than 2003. The main export items included 54.5 per cent in garment, 11 per cent in aquaproducts, 9.1 in footwear, 6.8 per cent in coffee, cashew-nuts, and rubber, 7 per cent in furniture, 4.7 per cent oil and gas. Ms Heather Variava, Economic Attaché of the US Consulate General, said that many Vietnamese products and companies have secured a foothold in the American market and she believed that more will come in the near future. In spite of some difficulties and hurdles, the United States remain a potential market for Vietnamese export. Vietnamese export makes up only 0.4 per cent of American import value. With BTA having been already enforced for three years and less tariff reductions, Vietnamese exports may be slower in the coming years depending chiefly on supply capacity, competitiveness and marketing.
Practical experiences
Mr Pham Van Que, Deputy Head of American Department, Foreign Ministry, said that in the big American market, businesses can only succeed with products of high quality, prestige and good marketing. They must have good knowledge of America, it’s culture, people and law. The Americans are forthright, outspoken and often bring to disputes to court. Vietnamese businesses must be prepared for law suits and unite in business activities.
Referring to the American market, Ms Heather Variava pointed out three characteristics: American consumers, totally imported market and business practice. She also said that the United States is a consumption economy and the people like spending. With E-commerce, they can compare products before buying. They prefer products with different styles, colours and sizes. Vietnamese businesses must be dynamic to meet their tastes and to maintain the reputation of trademarks. Deliveries must also be on schedule to ensure consumption seasons. With a different culture from Asia and Vietnam, the Americans readily voice their complaints and want clear answers from partners so that they can take quick and definite decisions.
Export value of US$5.7-5.9 billion in 2005
Basing on 2004 exports and the plan for 2005, Vietnamese exports in 2005 to the US are estimated to be between US$5.7-5.9, or 15-20 per cent more than 2004. Vietnamese garments attract American importers with their product quality and punctual delivery. However, from January 1, 2005, Vietnamese garments are restricted by quota while 150 other countries are free to export to this market. The US imports big volumes of fresh and frozen seafood. Shrimp imports will increase in 2005. With better quality and a lower anti-dumping tax rate than China, India, Brazil and Thailand, Vietnamese shrimp will be more competitive in the American market. The export value will be 2-4 per cent more than 2003. The total export value of seafood is expected at US$750-770 million, or 40-45 per cent more than 2004.
In 2005, the economic growth rate of the US will continue at 3.5 per cent. Unlike garments, the import value of footwear will undergo big changes. The main competitors of Vietnam in sport-shoes and women’s footwear are China, Brazil and Indonesia. With cheap labour and skilled workers, Vietnam should focus on products of medium and high quality to export to the American market. In 2004, Vietnam increased the export of wooden furniture to US$360 million as the import tax dropped from 50-55 to 0-3 per cent. American companies continue to import non-Chinese furniture to avoid anti-dumping tax rates levied on Chinese products.
Vietnamese
