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Trade with China: Vietnam should boost exports
In the last few years, two-way trade turnover between the neighbours has been increasing steadily by 25% per annum. China has become the No 1 trade partner of Vietnam, according to Dao Tran Nhan, Deputy Director of the Asia-Pacific Market Policies Department under the Ministry of Industry and Trade.
Nhan said on the sideline of the meeting with the delegation of 14 Chinese enterprises which arrived in Hanoi to seek business opportunities on May 12, that with 1.3 billion consumers, China proves to be a vast consumption market, while the market does not set overly high requirements on product quality.
Which Vietnamese products are favoured by Chinese partners and which Chinese products are Vietnamese enterprises interested in?
The three main Vietnamese export items are rubber, coal and crude oil. We also export farm produce, forestry products, seafood and woodwork.
Vietnam mainly imports machinery, steel and materials for production. The Chinese market is providing nearly all the materials Vietnam needs. Statistics show that cross-border trade now makes up 40% of the total trade turnover between Vietnam and China.
Vietnam has been importing more from China than it exports to China. Has the Ministry of Industry and Trade drawn up any policies to help narrow the trade gap?
This is one of the problems the ministry is interested in. However, we should not think of reducing the trade deficit by cutting imports from China. Instead of this, we should think of pushing up exports to China to balance the trade.
The ministry has also encouraged businesses to export processed products which have added value, instead of exporting raw materials.
The Asia-Pacific Trade Policies Department is compiling a project on reducing the trade gap, which will introduce a lot of measures to improve the situation.
I’m afraid I cannot talk much about the project since it is still being compiled.
As far as I know, Vietnamese goods exported to China across the border always get stuck at border gates, which makes Vietnamese businesses suffer. What are the reasons behind this?
I can affirm that the Chinese side does not deliberately create difficulties for Vietnamese exports. Many Vietnamese merchants are forced to sell products at low prices because they do not sign contracts with Chinese partners. They just take commodities to the border gate and make deals with buyers they meet there.
I know that big volumes of farm produce have been given away because Vietnamese merchants brought a larger volume of commodities than the customs clearance capacity of the border gates.
As of July 1, 2009, under the new regulations, Vietnamese fruit will have to have documents showing origin. Do you think that the requirements will put difficulties on Vietnamese fruit exports?
The regulation is part of the agreement signed between the Ministry of Agriculture and Rural Development of Vietnam and the Chinese counterpart. Chinese enterprises will also have to provide Vietnam with information.
I have to say that the regulation will create some difficulties for Vietnamese enterprises in the first period of implementing the regulation. However, in the long term, the regulation will help boost trade between the two countries.
Do you think that two-way trade will see decreases in 2009 in the context of the global economic recession?
It is expected that two-way trade will reach $25 billion by 2010, which is the political determination of the two countries. This means that the two countries need to reach $23 billion in two-way trade in 2009.
In 2008, two-way trade was $20.2 billion, up by 27% over 2007. Vietnam’s export turnover was $4.5 billion, up by 35%, while import turnover was $15.6 billion only, up by 25.2%.
In Q1, 2009, two-way trade turnover was $3.8 billion, down by 26% from the same period of last year.
vietnamnet, vneconomy
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