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

Electronics industry overcomes challenges to penetrate deep into global supply chain

Electronics industry overcomes challenges to penetrate deep into global supply chain

VCN - In addition to the opportunities from the investment shift in the electronics industry, Vietnamese enterprises also face many challenges in terms of capital, technology and human resources. Ms. Do Thi Thuy Huong, Executive Committee Member of the Vietnam Electronics Industry Association (VEIA), shared about the future directions for this potential industry.
Vietnamese businesses in the face of the wave of international e-commerce platforms: Benefits and challenges

Vietnamese businesses in the face of the wave of international e-commerce platforms: Benefits and challenges

VCN - In the context of the increasingly vibrant e-commerce market in Vietnam, the emergence of international e-commerce platforms with attractive incentives is creating a new wave for consumers. However, this development not only brings benefits but also poses many challenges for Vietnamese businesses, especially small and medium enterprises.
“Greening” the textile, garment and footwear industry: Motivation from challenges

“Greening” the textile, garment and footwear industry: Motivation from challenges

VCN - Vietnam's textile and footwear industry is facing great pressure to satisfy more demanding requirements from international brands and national commitments on emission reduction while the input material and production costs are escalating.
Lang Son: New challenges in combating smuggling and trade fraud

Lang Son: New challenges in combating smuggling and trade fraud

VCN - The large, complex, rugged area, with difficult traffic… is a huge obstacle to the anti-smuggling work of the State authorities in Lang Son. Therefore, strengthening coordination is an important solution to combat violations at the border.

Latest News

VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.
Approach strategy of the seafood industry when implementing UKVFTA

Approach strategy of the seafood industry when implementing UKVFTA

VCN - As one of Vietnam's strong export industries to the UK, especially when the Vietnam - United Kingdom of Great Britain and Northern Ireland Free Trade Agreement (UKVFTA) comes into effect, with a detailed information approach strategy, it has created a great driving force to promote the export of Vietnamese seafood products to this market.
Mid-November: Vietnam

Mid-November: Vietnam's trade volume matches 2023 total, eyes record-breaking growth

VCN - By mid-November 2024, Vietnam's total import-export turnover reached an impressive US$681.48 billion, equaling the full-year trade figure for 2023
Vietnamese enterprises facing challenges from cross-border e-commerce platforms

Vietnamese enterprises facing challenges from cross-border e-commerce platforms

VCN – In recent years, with the rapid development of cross-border e-commerce (CBEC) platforms, domestic enterprises in Vietnam have been facing numerous difficulties and challenges.

More News

Vietnam, Malaysia eye new milestone in trade ties

Vietnam, Malaysia eye new milestone in trade ties

The official visit to Malaysia from November 21-23 by Party General Secretary To Lam is expected to open up new opportunities for and mark a new milestone in the economic and trade cooperation between Vietnam and Malaysia. Vietnam and Malaysia are key economic, trade, and investment partners. Their economic and trade ties have steadily grown since the two nations established diplomatic relations in 1973.
Shrimp exports surge in 10 months, generating 3.2 billion USD

Shrimp exports surge in 10 months, generating 3.2 billion USD

Vietnam’s shrimp exports in October reached US$394 million, a strong 24% increase year-on-year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
Vietnam’s exports to the U.S. near US$100 billion milestone

Vietnam’s exports to the U.S. near US$100 billion milestone

VCN - By the end of October, Vietnam's exports to the United States approached US$100 billion, reaffirming its position as Vietnam's largest export market.
From the “abnormal” coffee price, worries about the new crop

From the “abnormal” coffee price, worries about the new crop

VCN - The Vietnamese coffee industry enters the new crop with the question of what is a reasonable price to ensure benefits for coffee growers while still retaining international consumers.
What obstacles limit the market share of Vietnamese goods in the UK?

What obstacles limit the market share of Vietnamese goods in the UK?

VCN - Vietnamese goods account for only about 1% of total imports into the UK market. One of the reasons is that they have not yet built their own brands and have not focused on effective strategies and approaches to market information.
Why seafood exports to some Middle Eastern Countries are stalled

Why seafood exports to some Middle Eastern Countries are stalled

VCN - Several shipments of seafood exported to certain Middle Eastern countries have been delayed due to legal challenges related to consular legalization procedures. This has created significant bottlenecks in accessing these markets.
Storm No. 3 destroys profits of many insurance companies

Storm No. 3 destroys profits of many insurance companies

VCN - Due to the impact of storm No. 3, the business results of the third quarter and the first 9 months of 2024 of the insurance sector have been significantly affected. This requires more efforts from businesses for the results of the whole year 2024.
Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Cooperation in the Halal industry can help Vietnamese products reach nearly 2 billion Muslim consumers worldwide, representing over 24% of the global population, according to Malaysia’s Minister of Investment, Trade, and Industry Zafrul Abdul Aziz.
Tra fish sector aiming for production, processing greening for sustainable development

Tra fish sector aiming for production, processing greening for sustainable development

Greening production and processing to meet export requirements is both a trend and a necessity for many industries, including the tra fish sector.
Read More

Your care

Latest Most read
VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.
Approach strategy of the seafood industry when implementing UKVFTA

Approach strategy of the seafood industry when implementing UKVFTA

VCN - Mr. Nguyen Hoai Nam, Deputy General Secretary, Vietnam Association of Seafood Exporters and Producers (VASEP), said that the advantage that UKVFTA brings is that the main products of the seafood industry enjoy 0% import tax to the UK, especially key
Mid-November: Vietnam

Mid-November: Vietnam's trade volume matches 2023 total, eyes record-breaking growth

By mid-November 2024, Vietnam's total import-export turnover reached an impressive US$681.48 billion, equaling the full-year trade figure for 2023
Vietnamese enterprises facing challenges from cross-border e-commerce platforms

Vietnamese enterprises facing challenges from cross-border e-commerce platforms

VCN - E-commerce platforms have emerged as crucial distribution channels, enabling goods to reach consumers quickly and conveniently.
Vietnam, Malaysia eye new milestone in trade ties

Vietnam, Malaysia eye new milestone in trade ties

The official visit to Malaysia from November 21-23 by Party General Secretary To Lam is expected to open up new opportunities for and mark a new milestone in the economic and trade cooperation between Vietnam and Malaysia. Vietnam and Malaysia are key economic, trade, and investment partners. Their economic and trade ties have steadily grown since the two nations established diplomatic relations in 1973.
Mobile Version