Vietnam Exports: Prolonged Arms

 

All enterprises shared the view that foreign market information is now the most challenging issue for exporting companies, especially when Vietnam has become a full member of the World Trade Organisation (WTO) and local companies are expanding their export markets.

The wider export markets are expanded, the more hopes local companies place on commercial counsellors working in other countries. They want to receive new, accurate and hot information about their business partners, especially those involving in financial crisis or bankruptcy. Many companies also expressed hopes to receive assistance and protection from commercial counsellors and ambassadors of Vietnam in other countries in cases involving trade disputes.

 

All commercial counsellors affirmed that they would try their best to fulfil their duties and missions but they thought that the export expansion is reliant on the capacities of exporters. As a commercial bridge, commercial counsellors required companies to have more active and timely cooperation and learn more professional business methods.

 

Nguyen Duy Khien, a commercial counsellor in the United States, affirmed that the picture of Vietnam’s exports to the United States is very clear. Vietnam has set a goal to increase export revenues to the US by 20 per cent, but Khien believed “We can reach 30 per cent.” According to Khien, his belief is based on two reasons. Firstly, the Vietnamese exports to the United States could possibly increase sharply this year. The WTO entry provides momentum and pressure to urge Vietnamese companies to export more. United States’ companies will also increase investment in Vietnam to bring their made-in-Vietnam products to the United States. Secondly, demand by the United States is too big while the Vietnamese supply is too small. Each year, the United States spends up to US$12 billion on seafood but Vietnam can only earn US500 million from this amount. The same situation also happens to furniture, playthings and bicycles. Mr Khien said Vietnamese companies are unable to avoid direct competition with exporters of other countries in increasing exports. “Only companies with have better but cheaper products are able to supplant rivals to occupy the market. Vietnam has proven this ability, and in the past years, Vietnamese companies have taken up significant market shares from Indonesia, Russian and Italian rivals in the United States market,” Khien said.

 

Mr Dao Ngoc Chuong, Vietnamese commercial counsellor in China, also thought that if Vietnamese companies have good cooperation with commercial counsellors, the likelihood of market expansion is very high this year. Regarding the Chinese market alone, 14 major exports of Vietnam can be easily accepted. Vietnam can export tea, rubber, footwear, cashew nuts, pepper, wood and sliced cassava to China. The most difficult hindrance is the unfavourable traffic conditions which prevent the quality conservation of agricultural commodities during transport. The backward border gate system is an obstacle for Vietnamese exports. Previously, the Vietnam-China border trade was very good but now it has become a barrier because local exporters only pursue short-term benefits.

 

Mr Chuong proposed that China has a high very demand for four groups of Vietnamese agricultural commodities (rubber, cashew nuts, tropical fruits and dried sliced cassava); therefore, Vietnamese companies should immediately introduce strategies in these areas to boost production and increase export.

 

Addressing the meeting, Permanent Deputy Prime Minister Nguyen Sinh Hung advised that Vietnam should also pay attention to other countries in addition to the US and the EU in order to minimise risks. “In 2006, the export generated US$40 billion and this year the export growth is targeted at 22 per cent,” said the Deputy Prime Minister.

 

To date, Vietnam only has 55 commercial chambers and seven branches abroad, including 52 chambers for bilateral trade, only one chamber (Brussels) for bilateral and multilateral trade relations and one Geneva chamber (WTO) for multilateral trade relations.