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Expanding into European markets
The European Union (EU) is extremely important to Vietnam due to the large amount of Vietnamese products that it imports, and the EU also considers Vietnam to be an important source of quality goods. Relations between Vietnam and EU are continually being enhanced and Vietnamese producers are looking for opportunities to export more to this important export market.
The EU consists of 27 countries, it has a population of over 460 million people and its total GDP is nearly US$15 trillion (about 27 percent of the world GDP). Its imports and exports come to five trillion USD (about 45 percent of the world GDP) every year. EU services import/exports are some 43.8 percent of the world's services import/exports - about 2.5 times that of the USA.
Some 42.7 percent of services imported around the world are imported by the EU. EU-origin foreign direct investment (FDI) in non-EU countries makes up 47 percent of global FDI. The EU's official policy is to eliminate trade barriers, lower tariffs and develop good relationships with all other countries.
The EU has applied its Generalized System of Preferences (GSP) to goods being imported from 143 countries and it has given special treatment to poor countries in the world. Vietnam needs to make use of these preferences whenever possible and it needs to bring up these issues when discussing trade agreements with the EU.
Vietnam appreciates its strong relationship with the EU. Since diplomatic relations were established in 1990, Vietnam has signed more than 10 agreements with the EU to form a legal foundation that will increase trade between the two parties. Thanks to these bilateral efforts, bilateral trade between Vietnam and the EU has increased tremendously and it continues to do so.
Since 1990, trade between Vietnam and the EU has totaled US$76 billion. Of this US$50.4 billion represents Vietnamese goods that were exported to the EU and US$26.1 billion represents imports from the EU, reflecting the fact that the EU consistently imports more from Vietnam than it exports to Vietnam. Vietnamese goods exported to the EU, mostly footwear, textile and garment, coffee, wooden furniture and seafood, all sell well in the EU.
On the other hand, the machinery, medical supplies, raw materials for textile and garment and leather and footwear production, iron and steel and fertilizer, most of which is used in the production of exports, are greatly appreciated in Vietnam and improve the competitiveness Vietnamese products and businesses.
In 2009, the Ministry of Industry and Trade expects its total exports to increase 13 percent over last year. Exports to the EU are to be 15 percent higher than they were in 2008. To do this, Vietnamese companies will have to export more to the EU, and this will need to be goods that have a competitive advantage and new products that are made using modern technology. Examples would be mechanical, electrical and electronic devices.
Tropical agricultural products and light industrial products such as footwear, textiles and garments and fine art and handicraft products are also to continue to be exported. Industry associations direct research and keep track of EU trade policies and are able to advise ministries, departments and businesses about how they might expand into EU markets. Businesses also need to identify those goods that could be imported from the EU to best serve domestic production to increase exports.
In an attempt to promote trade and expand into new EU markets, in February 2009, Ministry of Industry and Trade representatives met with the European Commission during the Conference of Vietnamese Trade Counselors in EU Countries in Brussels, Belgium. The conference was sponsored by the Multilateral Trade Assistance Project III (MUTRAP III) and was to provide trade counselors and officials of the Ministry of Industry and Trade with general information about the EU, the relationship between Vietnam and the EU and updated European Commission regulations regarding entry of imports into the EU.
Recent regulations and information include foreign affairs and trade policies, the EU's reaction to the global recession, information regarding bilateral cooperation between Vietnam and EU, GSP, public service policies, intellectual property, the commercial management program, Forest Law Enforcement, Governance and Trade (FLEGT), dumping policies, climate change, energy, 'Illegal, Unregulated and Unreported Fishing' (IUU) and 'Registration, Evaluation, Authorization and Restriction of Chemicals' (REACH).
The conference was to help trade counselors understand changes that have been made to EU policies, especially those involving technical standards required for imports. At the conference, Vietnamese officials expressed their opinions and viewpoints regarding EU policy changes and presented points of contention that need to be resolved to satisfy their interests.
At the conference Deputy Minister of Industry and Trade Le Danh Vinh told the Vietnamese trade counselors that they need to be promoting the export of Vietnamese goods and they should be applying pressure on the European Commission to try to stop the EC from bringing a dumping suit against Vietnamese leather hat and footwear producers.
vietnamnet, vneconomy
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