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Viet Nam looks to ease trade deficit with China
To offset Viet Nam’s huge trade deficit with China, financial experts say the country should take steps to boost exports.
Recently, firms such as Bita’s, Vinacafe, Vinamit Viet Nam and handicraft and wooden furniture makers in northern Bac Ninh Province successfully penetrated the Chinese market.
Recently, firms such as Bita’s, Vinacafe, Vinamit Viet Nam and handicraft and wooden furniture makers in northern Bac Ninh Province successfully penetrated the Chinese market.
The General Department of Viet Nam Customs, said the country exported goods worth US$2.3 billion to China in the first five months of this year, up 43.7 per cent against the same period in 2009.
However, Viet Nam imported Chinese-made goods worth $7.3 billion, a year-on-year increase of 32 per cent.
The Asia-Pacific Department of the Vietnamese Ministry of Industry and Trade (MoIT) said China had been Viet Nam’s biggest trade partner since 2004. Last year, bilateral trade between the two countries reached $21.3 billion, 6 per cent more than in 2008. Bilateral trade this year is expected to reach $25 billion.
Boosting exports to China would help Viet Nam reduce its total trade deficit, the department said.
Viet Nam’s chief exports include coal; agro-forestry and fisheries products such as rubber, coffee and fruit. Viet Nam mainly imports steel; raw materials and accessories for the footwear and garment sectors; and petrol, chemical and plastic products.
To ensure there is sustainable trade between the two countries, the department said the two sides should bolster co-operation and information exchange, while offering preferential trade policies to equalise the trade imbalance.
Dao Tran Nhan, Director of the department, said MoIT recently asked China to implement favourable import policies on 16 Vietnamese goods such as agro-forest products and fruit.
Over the past few years, countries such as Singapore, the EU and China itself have begun investing in Viet Nam rather than the world’s second biggest economy because of rising raw-material prices and higher salaries.
"This is a good time for Viet Nam to collaborate with overseas investors to enhance exports to this promising market," Nhan said.
The department also said that tariffs had been reduced in the region. Since January 1, under the ASEAN-China Free Trade Agreement (ACFTA), import duties on thousands of commodities into China were cut to 0-5 per cent. Viet Nam is entitled to apply a tax rate of 5 per cent up to 2015.
The department suggested that Vietnamese companies should fully acquaint themselves with ACFTA.
Vietnamese companies should produce unique and competitively priced goods that cater to the needs of Chinese consumers and build solid trademarks, the department said.
Recently, firms such as Bita’s, Vinacafe, Vinamit Viet Nam and handicraft and wooden furniture makers in northern Bac Ninh Province successfully penetrated the Chinese market due to their diversified designs and high quality, the department said.
VietNamNet, VietNamNews
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