Exports to Reach US$394 Bln in 2023

9:46:46 AM | 2/13/2023

Vietnam targets export growth of 6% to US$393-394 billion in 2023.

Deputy Minister of Industry and Trade Do Thang Hai said that the country's exports reached US$371.3 billion in 2022, up 10.5% year on year. Domestic merchandise export was boosted by 15 free trade agreements (FTAs) in effect, from which Vietnam could tap tariff preferences and create more impetus for production.

Capturing market information

However, global economic slowdown and weakening trade in late 2022 were not expected to be overcome soon and would probably last till early 2023, thus hurting exporting activities in the coming time. Exportation was also affected by high inflation, high inventories and weak consumer demand in importing countries, Hai said, adding that the strongest impact was hit on non-essential commodities, which were key exports of Vietnam to developed countries. Supply chain shocks caused input prices to rise and resulted in high production costs.

Grasping the market situation in importing countries, trade counselors also regularly updated new information for domestic companies. Mr. Tran Ngoc Quan, Commercial Counselor of Vietnam Trade Office in Belgium and the EU, informed that, on January 27, 2023, the European Commission published the Official Gazette on Regulation (EU) 2023/174 dated January 26, 2023 on amendments to Regulation (EU) 2019/1793 on temporary application of official controls and emergency measures for certain foods imported into the EU. Accordingly, for Vietnam, spices which were controlled at 50% at the previous announcement like coriander, basil, mint and parsley, were removed from the control list.

Madam Tran Thu Quynh, Commercial Counselor of Vietnam Trade Office in Canada, said that some Vietnamese products sold better in Canada in 2022 such as tea, coffee and spices. Particularly for cinnamon, Canada spent US$8.6 million to import cinnamon from Vietnam, up 43.3% year on year. Vietnam can completely capture 50% of the market share in Canada in the coming years. Canada's import demand for textiles and garments surged 30.1% year on year. However, India, Indonesia and Sri Lanka are emerging as very strong competitors due to their ability to make sophisticated items.

Madam Nguyen Thi Hoang Thuy from Vietnam Trade Office in Sweden noted that environmental protection continued to affect consumer behavior of Nordic people. Green, recyclable, environmentally friendly, sustainable and reusable products will continue to be popular in the Nordic market. So, Vietnam’s export items need to be of this kind.

Besides traditional markets, new markets such as the United Arab Emirates (UAE) have high demand for imports because their manufacturing cannot meet domestic demand. According to Mr. Truong Xuan Trung, who is in charge of Vietnam Trade Office in the UAE (and Qatar), Vietnam needs to grasp the opportunity to boost its strong exports such as seafood, agricultural products (seedless lemon, dragon fruit, watermelon, fresh coconut, grapefruit, cashew and pepper); bags, suitcases and wallets; wooden products; footwear; electrical products and electric cables, because the market demand for these items is huge. Notably, the UAE is a very competitive market in terms of price and quality.

Focused solutions for export

One effective solution to boost exports is trade promotion, said Deputy Minister of Industry and Trade Do Thang Hai, noting that trade promotion needs to be deployed in a more diverse, intensive and effective manner, not only for export but also for import and investment, particularly for the processing industry. At the same time, assessments and comments on organized conferences should be integrated to draw experiences for better performance.

In this regard, Mr. Vu Ba Phu, Director of the Vietnam Trade Promotion Agency (Vietrade) under the Ministry of Industry and Trade, said that the national program on trade promotion has been approved by the Ministry of Industry and Trade with more than 100 projects. More than 10,000 companies have been supported to take part in trade connection and promotion events. Millions of businesses have benefited from market information, consulting and trade promotion programs and events. In 2023, the National Program on Trade Promotion approved 76 foreign trade development projects.

Minister of Industry and Trade Nguyen Hong Dien gave six solutions. Firstly, relevant agencies under the ministry, overseas Vietnamese trade agencies, industry associations, and large exporters need to conduct insightful research to grasp Party and State viewpoints, guidelines and policies on socioeconomic development strategies, plans, objectives and tasks to work out specific, appropriate and feasible plans.

At the same time, he recommended that consulting agencies focus on grasping new guidelines and policies of the host country; continue to collect information, connect markets, match merchandise supply and demand. This will help domestic companies revise and determine right production and business strategies and plans to meet market needs; focus on connecting domestic and foreign companies that supply materials and fuels, consume available products and develop new products for consumers.

Regarding the market, Minister Dien underlined the continuation and development of traditional markets and traditional products. At the same time, Vietnam will make every effort to develop new markets and new products (such as West Asia, South Asia, Africa, and Latin America) to bring Vietnamese products to more consumers in the world. The Ministry of Industry and Trade requested its subordinates to strengthen coordination with overseas Vietnamese trade agencies, relevant ministries and industry associations to better tap Vietnamese strong commodities, especially agricultural and aquatic products, including raw materials or processed items.

By Huong Ly, Vietnam Business Forum