VietNamNet Bridge – Chinese and ASEAN sourced goods have been
flooding the Vietnamese market and competing fiercely with Vietnam made
products. Meanwhile, the situation would be even worse when the ASEAN-China
free trade agreement (ASEAN +1) fully takes effect by 2015.
In fact, a part of the free trade
agreement has taken effect since January 1, 2010, when 90 percent of the goods
items imported from China, Indonesia, Thailand, the Philippines, Malaysia,
Singapore and Brunei were cut to zero percent. Meanwhile, the tax cuts on the
imports from Cambodia, Vietnam, Laos and Myanmar would take effect from 2015.
Far markets more easily approachable than near markets
Phan The Rue, Chair of the
Vietnam Retailers’ Association, former Deputy Minister of Trade, has admitted a
paradox that Vietnam can easily penetrate far markets, while it remains the
outsider of the regional markets like ASEAN or China.
The problem is that the importers
from the markets usually put big difficulties for Vietnamese exporters in terms
of prices, contracts and amounts of goods. Especially, risks would arise at any
time from the Chinese market.
Meanwhile, it is easy to deal
with the foreign partners from the far markets like the US or the EU. The trade
deals always can be carried out in a transparent way, while importers do not
force prices down or give up the orders.
Rue has warned that one of the
biggest problems for Vietnam is that the most well-known export items of
Vietnam are also the products which can be made by the other regional
countries.
For example, Vietnam’s garment
companies would find it difficult to penetrate the Chinese or Indonesian
markets, which also have developed garment industries.
“As for farm produce, ASEAN and
China have all the products which Vietnam has,” Rue said.
Vietnam has been penetrating more
deeply into the US and EU markets over the last few years, with the export
turnover on the steady rise year after year. The exports to the markets have
always been higher than the imports from the markets.
In the first eight months of the
year, for example, the surplus in the trade with the US reached 10 billion
dollars, while the figure of 1.1 billion dollars has been reported for the
German market.
Meanwhile, Vietnam has been
continuously witnessing the deficit when carrying out trade with ASEAN and
Chinese markets. In the first eight months of the year, Vietnam saw the deficit
of 10 billion dollars in doing trade with China, 3 billion dollars with
Singapore, 2.1 billion dollars with Thailand and 700 million dollars with
Malaysia.
The price and technique barriers
In the context of the gloomy
world market with the consumption on the sharp decrease, countries now tend to
install barriers to protect local production and domestic enterprises.
Le Van Tri, Deputy General
Director of Casumina, a rubber company, said all ASEAN countries all have
installed barriers against imports.
In order to export its products
to the regional markets, Casumina has to obtain the certificates on meeting the
technical standards from competent agencies of the import countries, which
takes six months at least.
After that, Casumina would have
to wait another six months during which the officials from import countries
visit Casumina’s factories to take samples of products for testing. Meanwhile,
the documents would be valid for two years only.
“One year is too long, which
would discourage everyone. That explains why many businesses give up the
games,” Tri said.
Ho Duc Lam, Chair of the Plastics
Association, also thinks that it is easier to penetrate the Vietnamese market
than other markets.
Compiled by C. V
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