Belgium - A Model of Vietnam-EU Relationship

 

Vietnam-Belgium relations can be regarded as a model of the Vietnam-EU relationship. The bilateral relations between the two countries was established on March 22, 1973 and has continued to develop in depth and scale, especially in economic relations. Several cooperation documents were signed such as on investment encouragement and protection (Jan. 1991), cooperation in energy research and development and technical training (June, 1991), civil aviation (Oct. 1992), non-double taxation (Feb. 1996). Currently, Belgium is one of the biggest trade partners of Vietnam.

 

The trade turnover of the two countries continues to increase but at a modest rate, from Euro601 million in 2002 to Euro681 million in 2005 or an increase of 5% a year. In 2005, Vietnamese export to Belgium was Euro555.7 million and import was Euro126.1 million. Main Vietnamese exports are footwear, garments, seafood, minerals and handicraft articles. In the first five months of 2006, the Vietnamese export value to Belgium was Euro266.5 million, 50% more than the same period last year.

 

In recent years, the bilateral trade relations have made stable progress. Many high-ranking government and business delegations have paid working visits to Belgium. In addition to traditional products, Vietnam has diversified its exports such as woodwork, fine art articles and agricultural produce. Vietnam Seafood Night at International Seafood Fair in Brussels, May 2005, two Vietnam Weeks at Sheraton Hotel, Brussels, November 2005, and other economic related cultural activities have provided Belgian people with a broader view of the Vietnamese market. Likewise, Belgian economic missions of different sectors and regions have also visited and sought business opportunities in Vietnam.

 

With our small staff and limited budget, the Vietnamese Commercial Office in Brussels has tried its best to help Vietnamese business understand the Belgian market and partners and Belgian investors and businesses understand Vietnamese market from macro economic and investment policies, encouragement projects, tariffs, to market information, products and prices, and related Vietnamese businesses.

 

Last year, we replied to hundreds of transaction letters and provided to the fullest possible information on Vietnamese and Belgian businesses. The commercial office has also met and discussed with potential Belgian investors on Vietnamese laws and related authorities to facilitate their investments in Vietnam.

 

The office has also assisted Vietnamese businesses to participate in trade fairs in Brussels and surrounding areas. Though the participation is increasing year-on-year, it still falls short of the expectation due to limited resources of Vietnamese businesses, especially small and medium enterprises.

 

We have just concluded a survey on businesses in Belgium and Luxembourg, mainly on their legal status and financial credibility to facilitate bilateral business activities.

 

To increase Vietnamese exports to those markets, we have the following recommendations: As an EU member, Belgium complies with EU regulations on import-export and food safety. Several Vietnamese businesses have violated regulations on food safety. In the first half of 2006, 37 cases of such violations were announced on the EU Fast Warning System. As recently as this July and August, 8 Vietnamese companies were mentioned on the system. In fact, it is difficult to have 100 Vietnamese businesses included in the list of seafood exporters to EU. It is even more difficult to avoid the temporary or ultimate exclusion from the list due to violations of food safety regulations. Vietnamese producers and exporters must pay special attention to these cases.

Since April 2004, the EU has conducted several anti-dumping investigations on Vietnamese exports to EU. In particular, the investigation on leather shoes and some others have not only seriously affected Vietnamese exports but also concerned enterprises and their export strategy. To avoid such investigation and related impact, concerned authorities (Competition Management Department, Ministry of Trade) should study fully those cases to avoid them in the future, diversify the markets and have suitable price strategy compatible with WTO norms.