Launching many FTAs: Opening the door to new markets

VCN - Besides the Free Trade Agreements (FTAs) that have been signed and put into practice, which have created many new development motivations, market expansion and diversification; activities to initiate negotiations for new agreements have also been initiated to open up new opportunities for businesses to seize the opportunity.
Businesses have many opportunities to expand their markets thanks to new FTAs. Photo: N. Thanh
Businesses have many opportunities to expand their markets thanks to new FTAs. Photo: N. Thanh

A huge advantage, but challenge is not tidy

The launch of negotiations for the Vietnam - UAE FTA Agreement (CEPA) is expected to further promote joint cooperation in trade, investment and energy between the two countries. Although the UAE is a potential market, it is still more or less a new market for Vietnamese businesses.

Mr. Truong Xuan Trung, First Secret, in charge of the Vietnam Trade Office in the UAE, said that the UAE's agricultural sector accounts for only 0.9% (mainly livestock and date cultivation), the industrial sector accounting for 49.8% (mainly crude oil extraction and processing) in the economic structure of the UAE, so the UAE is almost entirely dependent on imports of agricultural products; Seafood; processed foods; textile; leather shoes; machinery, equipment, tools and spare parts; phone; electronic products… to meet domestic demand. As a result, the UAE is considered an open market with virtually no barriers to trade.

However, the UAE is a very competitive market, which is also the biggest challenge for Vietnamese businesses. In addition, another challenge for Vietnamese businesses is to directly compete with businesses from some countries that they have signed CEPA with the UAE such as India, Indonesia, Israel and Turkey because businesses of these countries have enjoyed preferential treatment when exporting goods to the UAE, creating a competitive advantage for Vietnamese exporters.

In the field of energy cooperation, the UAE is one of the most important partners in the Middle East. Truong Xuan Trung said that the UAE has large oil and gas reserves, has a developed oil and gas extraction and processing industry, and has an important position and role in the world's energy industry.

Also a potential market for Vietnamese goods, the conclusion of the Vietnam-Israel FTA negotiation recently assessed by experts will help diversify the market. Mr. Le Quoc Phuong, former Deputy Director of the Center for Industry and Trade (Ministry of Industry and Trade), said that, in terms of trade and investment scale, compared to signed FTAs such as with the EU, CPTPP, etc., the Vietnam FTA is - Israel is not large, but it means a lot in the future. The signing and implementation of the agreement helps to diversify, multilateralize and expand trade relations with West Asia and Southwest Asia - an area where we still have relatively limited relations and hope to be expanded. At the same time, diversifying investment sources in the context of the world economy is still difficult.

In particular, according to Mr. Le Quoc Phuong, Israel is an economy with high technology, especially technology in agriculture. Therefore, it is hoped that this FTA will not only help further open the trade relationship between the two countries, but also help attract investment in Vietnam's high-tech agricultural sector, which Vietnam desperately needs and wants to develop but it is not commensurate with its potential.

Adapt to dominate the market

Although the opportunities from FTAs are great, in order to penetrate the market, businesses need to clearly grasp the consumption trends in the host country to quickly adapt.

The Vietnam Trade Office in the UAE said that to be able to further promote the export of Vietnamese goods to the UAE, Vietnamese businesses need to apply advanced science and technology in production, change production methods, management, minimizing intermediary costs, in order to reduce product costs and increase the competitiveness of Vietnamese products. In addition, because the UAE is an Islamic country, so Vietnamese businesses also need to learn about Muslim culture and consumer needs, build a Halal certification system for products, beverages, cosmetics, Islamic fashion... when exporting to the UAE.

According to Mr. Truong Xuan Trung, when CEPA is signed, the trade and investment relationship between the two countries is expected to continue to grow stronger. UAE is considered the financial and trade center of the Middle East, an important gateway to bring Vietnamese goods to the Middle East, Africa and Europe. In addition, the UAE has a strategic geographical position and a modern logistics system that will create favorable conditions for Vietnamese goods to access and expand to the global market.

According to Mr. Le Quoc Phuong, signing was difficult, to make good use of it, businesses must make a lot of effort. It can be seen that, recently, not all FTAs have been well utilized by enterprises. Besides, most of the FTAs we signed such as FTAs with the EU, Korea, Japan... in fact, FDI enterprises are taking advantage of better. The reason is that these enterprises come from developed countries, have experience in accessing markets, financial and human resources and own products that meet the technical standards of the FTA, etc. Therefore, domestic enterprises have not taken advantage of it as well.

Therefore, not only the Vietnam-Israel FTA but many other FTAs, businesses must carefully study the market; at the same time, the enterprise's products must meet the requirements of standards and techniques. Currently, many FTAs require standards on environment, labor, use of human resources... but all of that; Vietnamese enterprises are still very weak. In addition, businesses must learn carefully to understand the content of FTAs, and learn about incentives on certificates of origin to make effective use of FTAs. At the same time, make good use of state support to innovate technology, and improve product quality...

By Ngọc Linh/Bui Diep

Related News

Numerous growth drivers, opening opportunities for enterprises

Numerous growth drivers, opening opportunities for enterprises

VCN - That is the appraisal given by experts at the seminar "HUBA Entrepreneurs' Coffee" under the theme: "Vietnam and HCMC's Economy in 2024 - Issues of interest to entrepreneurs," which took place on March 9, organized by the Ho Chi Minh City Business Association (HUBA).
Export businesses seek opportunities for 2024

Export businesses seek opportunities for 2024

VCN - The global trade outlook in 2024 is forecast to continue to face many challenges, negatively affecting the export activities of Vietnamese enterprises. To continue to survive and develop, businesses have to make the most of even the smallest opportunity.
Banks are facing new challenges in 2024

Banks are facing new challenges in 2024

VCN - According to assessments of credit institutions, the business situation and profits in 2023 are low and have not met expectations, but in the first quarter of 2024 and the whole year 2024, the situation will be better. However, many new challenges are also awaiting banks this year.
Vietnam

Vietnam's trucking industry in the context of Asian logistics development

VCN - Vietnam's Logistics Performance Index (LPI) has increased to 3.3 points from 3.27 points in 2018, indicating gradual improvement, especially in customs procedures and infrastructure quality.

Latest News

Investors play a key role in developing the industrial park system

Investors play a key role in developing the industrial park system

VCN - Dr. Phan Huu Thang, Chairman of the Executive Committee of the Vietnam Industrial Park Finance Association, former Director of the Foreign Investment Department (Ministry of Planning and Investment), said that basically, developing an industrial park successfully or not mainly depends on businesses, entrepreneurs - industrial park investors.
Find ways to a corporation for businesses in industrial parks

Find ways to a corporation for businesses in industrial parks

VCN - The country has nearly 300 industrial parks in operation, but with the requirement to join the global value chain, the issue of linkage and connection between businesses in industrial parks and industrial clusters needs to be concentrated on more.
Export turnover of two agricultural product groups grows three-digit

Export turnover of two agricultural product groups grows three-digit

VCN – In March, the export turnover of agricultural product groups grows three-digit compared with the previous month.
Early warnings reduce risks in trade defense

Early warnings reduce risks in trade defense

VCN - In the first months of 2024, export turnover of goods grew strongly, continuing the recovery momentum from the end of 2023. Along with that, the risk of trade defense investigations also escalated

More News

Rubber exports are flourishing, promising potential

Rubber exports are flourishing, promising potential

VCN - Rubber exports reached 414.31 thousand tons in the first quarter of 2024, worth US$607.35 million, increasing 8.5% in volume and 14.3% in value compared to the same period in 2023.
Vietnam becomes biggest rice supplier for Singapore

Vietnam becomes biggest rice supplier for Singapore

Vietnam has for the first time surpassed India and Thailand to become the largest rice exporter to Singapore by shipping 36.15 million SGD (26.55 million USD) worth of rice in the first three months of this year, an increase of 80.46% over the same period in 2023, winning 32.03% of the market share, according to the Vietnam Trade Office in Singapore.
Vietnam an attractive destination for electronics, semiconductor investors: Official

Vietnam an attractive destination for electronics, semiconductor investors: Official

Vietnam has strong infrastructure and research and development incentives as well as a skilled workforce, making it an attractive for “eagles” worldwide in the electronics and semiconductor industry, according to Deputy Minister of Planning and Investment Tran Duy Dong.
Wood exports started well

Wood exports started well

VCN - After a year of missing the growth target, the year of 2024 exporting wood and wood products has had a good start, but there are still many potential risks.
Take advantage of e-commerce leverage for export

Take advantage of e-commerce leverage for export

VCN - Exporting via e-commerce is gradually becoming popular and becoming a trend that many businesses are interested in.
Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam in the first quarter of 2024 exported 2.18 million tonnes of rice, earning 1.43 billion USD, an increase of 17.6% in volume and 45.5% in value year on year. Meanwhile, the average export rice price also increased by 23.6% to $653.9 per tonne.
Localities get ready for fourth FDI boom

Localities get ready for fourth FDI boom

As the year 2024 is expected to witness the start of the fourth wave of foreign direct investment (FDI) to Vietnam, localities nationwide are getting ready to absorb foreign capital flows.
Opportunities to develop a smart and sustainable packaging industry

Opportunities to develop a smart and sustainable packaging industry

VCN - The concept of circular economy and sustainability requirements are increasingly influencing packaging design. In particular, highly recyclable packaging is gradually becoming an important part of the packaging process in the food and beverage industry. This is also one of the key factors promoting the development of Vietnam's packaging industry.
Domestic retailers eye export-quality products

Domestic retailers eye export-quality products

Domestic retailers are increasing the distribution of export-quality products to cash in on the consumption trend towards green, environmentally friendly and safe products.
Read More

Your care

Latest Most read
Investors play a key role in developing the industrial park system

Investors play a key role in developing the industrial park system

VCN - Dr. Phan Huu Thang, Chairman of the Executive Committee of the Vietnam Industrial Park Finance Association, former Director of the Foreign Investment Department (Ministry of Planning and Investment), said that basically, developing an industrial par
Find ways to a corporation for businesses in industrial parks

Find ways to a corporation for businesses in industrial parks

With the requirement to join the global value chain, the issue of linkage and connection between businesses in industrial parks and industrial clusters needs to be concentrated on more.
Export turnover of two agricultural product groups grows three-digit

Export turnover of two agricultural product groups grows three-digit

VCN - Accordingly, the export volume of Cashew nuts in March reached 58,922 tons with the export turnover of US$315.45 million, up 121.6% in volume and 122.3% in value compared with the previous month.
Early warnings reduce risks in trade defense

Early warnings reduce risks in trade defense

VCN - In the first months of 2024, export turnover of goods grew strongly, continuing the recovery momentum from the end of 2023. Along with that, the risk of trade defense investigations also escalated
Rubber exports are flourishing, promising potential

Rubber exports are flourishing, promising potential

Rubber exports reached 414.31 thousand tons in the first quarter of 2024, worth US$607.35 million, increasing 8.5% in volume and 14.3% in value compared to the same period in 2023.
Mobile Version