In recent years there has been a lot of stress on search for new markets
for Vietnam’s exports, but according to analysts and many enterprises, the US
market remains a potential market for Vietnamese exporters to further develop.
Nguyen Duy Khien, head of the
American Market Department under the Ministry of Industry and Trade, has
reiterated export potential and opportunities for Vietnamese products in the US
market many times.
As a highly populated country
with lavish spending habits, the US imports more than US$2 trillion worth of
goods annually. However, Vietnamese products only account for 1 percent of US
imports, though it is currently one of two biggest importers of Vietnam.
Vo Truong Thanh, chairman cum CEO
of Truong Thanh Furniture Corporation, also reckoned that furniture industry
and other export industries of Vietnam should promote exports to the US market.
To lessen concerns about ‘putting all eggs in one basket’, he explained that
during the economic recession there was a slump in consumer demand in the US,
but not very much, and many Vietnamese export products still maintained growth
in the past year.
For instance, garment and textile
exports still posted a growth of 9.2 percent last year and were expected to
keep growing this year as among $100 billion worth garment and textile imports
in the US, Vietnamese products merely account for a modest $7.6 billion.
Similarly, the US market
currently was the largest furniture importer with more than 40 percent of
market share but Vietnamese wooden products just account for a small portion of
this market.
In addition, the fact that
Vietnamese products remained of poor quantity because the country only
concentrated on exporting traditional merchandise such as garment and textile,
footwear and furniture, which all lack diversity. This has lowered export value
and once the advantage of low labor cost vanishes, Vietnam will lose its strong
point when exporting such merchandise.
With huge potential, the US
market is waiting for Vietnamese enterprises to discover the potential.
However, opportunities come with
challenges.
Because of the high demand, many
countries will want to bring their products to the US market; hence, fierce
competition is inevitable. Especially, Chinese products have become a big
challenge for Vietnam.
Plus, in order to make US
importers switch from buying goods from their regular partners to buying goods
from Vietnamese exporters, the latter have to offer high-quality products at
lower price or more unique than others. Nevertheless, due to its geographic
distance, Vietnamese enterprises have to bear higher shipping costs. Vietnam
has not received preferential duties, and in addition, trade barriers put up by
the US Government against import products from some countries, including
Vietnam also have been causing headaches for businesses.
Among trade barriers,
anti-dumping duty was imposed on many Vietnamese export products. Of late, the
US Coalition of Gulf Shrimp Industries has continuously proceeded against
Vietnamese frozen shrimps. Food industry also worries about new regulations of
the US Government.
Accordingly, Vietnamese food
exporters not only have to register again on food facilities with the US Food
and Drugs Administration (FDA) in order to be able to export products to the US
market since January 1, 2013 but also have to maintain contact all day with
their US partner. This means that each business has to have a representative,
who can be an individual, a company, or an organization whose headquarter is
located in the States and register with the FDA. This representative will play
an on-site contact role and maintain constant interaction with the FDA.
Moreover, importers usually order
big contracts while most Vietnamese companies fail to fulfill this requirement
as for larger orders they must use intermediaries.
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