Create export resilience from new markets

	Enterprises must comply with regulations to enjoy import and export tax incentives
	Revenue from imports and exports falls by 19.4%
	Maximizing benefits from strict compliance with commitments on import and export tax incentives

Vietnam pavilion in the field of agricultural products and processed foods at Gulfood Dubai 2022 (UAE). Photo: Internet

Many potential markets

Attending a recent trade promotion conference, Minister of Industry and Trade, Nguyen Hong Dien said that besides maintaining traditional markets, it is necessary to make maximum efforts to develop new markets and new products such as Western markets, Asia, South Asia, Africa, and Latin America so that Vietnamese goods can reach further, better meeting world consumption needs.

A new market is a potential land for businesses to seize opportunities. As in the African market, according to data from the General Department of Customs, in 2022, our country's export turnover to Algeria will reach more than USD 141 million, down 7.8% compared to 2021.

Main export items are coffee, chemicals, aquatic products, metals and products, and pepper. Notably, in 2022, Vietnam was able to export rice again, reaching a turnover of more than USD 218,000.

According to the Vietnam Trade Office in Algeria, the exports of chemical and metal products in 2022 decreased sharply compared to the same period in 2021 because Algeria was able to produce these products, on the other hand, the Algerian Government restricted the import of goods that the country can produce by setting high taxes or not granting import permits. Coffee exports decreased because in the first six months of the year high freight rates made customers switch to buying coffee from countries in the region.

Also in Africa, the export market to Senegal reached more than USD 36 million per year, up 19% over the previous year. Main export items include pepper, confectionery and cereal products, textiles, seafood, rice, transport vehicles and spare parts.

Also according to the Vietnam Trade Office in Algeria, in 2023, Algeria will continue to implement the policy of restricting imports, attracting foreign investment, and promoting the export of non-petroleum products. To capture the country's import demand, the Trade Office said that the products which Algeria does not restrict imports are products that this country cannot produce, such as rice, pepper, raw coffee, basa fish, and coconut rice, cinnamon, anise, cashew, raw materials (wood, plastic, paper).

Besides, potential export products to Senegal are also Vietnam's strengths such as broken rice (100%), pepper, confectionery, cereal products, textiles and seafood.

In the UAE market, in 2023, it is forecast that the number of tourists to the UAE will increase, leading to an increase in the demand for food, beverages, textiles and footwear.

This is a good opportunity for Vietnam to export these items to the UAE market. Mr. Truong Xuan Trung - Vietnam Trade Office in the UAE (United Arab Emirates) said that industrial and agricultural production in the UAE is quite limited, and most food and consumer goods must be imported to meet the needs of the people.

This is also one of the reasons that helped Vietnam’s trade surplus with the UAE reach USD 3.3 billion last year. Some products of Vietnam occupy a large market share and continue to be able to export to the UAE market this year such as aquatic products, agricultural products and vegetables.

For example, dragon fruit, watermelon, and seedless lemon, Vietnam is dominating the UAE market as well as the Middle East and GCC (Gulf Arab Cooperation Council) markets; With rice, Vietnam is currently ranked 3rd in the world after India and Pakistan in terms of exports to the UAE. Not only agricultural, aquatic products, but also a number of processed industrial products of Vietnam also had the opportunity to export to the UAE.

Although Vietnamese goods have been present, even accounting for a large market share in the UAE, however, Mr. Trung said that this is a fiercely competitive market in terms of price and quality. Every Monday, UAE importers will consider the offer prices of the sending countries; the higher prices will be eliminated, and even businesses that are exporting to the UAE this week, or next week may lose orders. In addition, the UAE is an Islamic country, and most food and beverages imported into the UAE must have Halal certification. Therefore, Vietnamese exporters need to pay attention when exporting to this market.

Logistics has a direct impact on competitive pricing

In the Americas, Brazil is Vietnam's second-largest trading partner after the United States. According to Mr. Ngo Xuan Ty, Head of Vietnam Trade Office in Brazil, Brazil is a large and very potential market for Vietnamese goods. Because this is a market that is not too strict and people's tastes are very diverse, many Vietnamese products can be welcomed in this crowded market.

However, according to the Vietnam Trade Office in Brazil, in order to dominate this market, Vietnamese enterprises also have to face difficulties and challenges such as the long geographical distance.

The means of transportation are not convenient to connect the people of the two countries as well as the logistics that have not met the import and export needs of the two sides. In addition, the fierce competition in quality and price from export competitors from China, Thailand, Indonesia, Malaysia, Philippines, and Singapore is also an issue that Vietnamese enterprises must take into account.

Therefore, to promote effective trade with this market, according to Mr. Ngo Xuan Ty, it is necessary to strengthen the introduction and promotion of Vietnamese products and goods directly at fairs and exhibition centers.

The trade deal also recommended the Ministry of Industry and Trade request the Government to promote the development of the logistics sector, improve Vietnam's logistics capacity and help businesses facilitate exports because logistics activities directly affect competition on price and delivery time with export competitors from China, Thailand, Indonesia, Malaysia, Philippines, and Singapore. In addition, the Ministry of Industry and Trade should propose the Government have a policy of opening a flight route connecting with Sao Paulo, Brazil because this is the largest transaction gateway in South America.

Along with that, businesses, associations, and localities should coordinate with the Ministry of Industry and Trade to participate in direct promotion programs such as fairs, exhibitions, promotion conferences and business conferences in Brazil and concurrently countries, especially Peru and Bolivia.

“The Peruvian market is an open market with great potential. As an opportunity to increase the export of Vietnamese goods to the Peruvian market, local people are very welcome to import goods if the quality is good, the price is competitive; businesses should have many promotion and introduction programs of products in Peru,” said Mr. Ngo Xuan Ty.