In order to have an effective strategy to access any of the Asian markets, the top specialists of Regional Market Departments recommend, that businesses need to actively understand the needs and specific requirements of each country, businesses need to focus on processing to create a differentiate and excel in product quality, thereby increasing competitiveness and penetrating deeper into this potential market. With growing popularity of Vietnamese goods in the world we will address the best on modern traditions of our Vietnamese partners effectively operating in Asia. To understand the depth of vision and polarity of Vietnamese approaches we will indicate only several prominent directions as brightest examples.
FIRST DIRECTION – JAPAN
Trade between Vietnam and Japan has achieved very positive results and maintained a steady growth rate in the past period. There is still a lot of room, potential and promising opportunities to continue developing trade relations between the two countries through FTAs, official cooperation mechanisms and new forms of trade promotion, towards access deep and sustainable market.
Japan is Vietnam’s leading economic and trade partner. Trade turnover between the two countries currently reaches more than 40 billion USD. Notably, the export and import turnover of our country and Japan are relatively balanced. The growth rate of trade between the two sides has also been steady in the past period.
In the first 10 months of 2021, Vietnam’s import and export turnover with Japan reached 34.3 billion USD, up 6.4% over the same period in 2020. Regarding exports, Vietnam’s turnover to Japan reached 16 ,3 billion USD. Import turnover of Vietnam from Japan reached 18.1 billion USD.
In addition, Japan is also a partner that has signed many bilateral and multilateral free trade agreements with Vietnam such as the Vietnam – Japan Economic Partnership Agreement (VJEPA in 2009); ASEAN – Japan Comprehensive Economic Partnership Agreement (AJCEP 2008); Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP in 2019), Regional Comprehensive Economic Partnership Agreement (RCEP in 2020).
In addition, Vietnam and Japan have many official cooperation mechanisms to deal with economic and trade issues, including: Joint Committee on Trade, Industry and Energy Cooperation between Vietnam and Japan. , Vietnam – Japan Cooperation Committee, Vietnam – Japan Joint Initiative.
The special thing is that the structure of import and export products of the two countries is clearly complementary, there is no direct competition. Vietnam mainly produces and exports to Japan seafood, crude oil, textiles, electrical wires and cables, wood and wood products, computers and components, coal, shoes of all kinds. …
Meanwhile, Vietnam imports from Japan goods for industrial production including machinery, equipment, tools and spare parts, electronic products and components, iron and steel of all kinds, fabrics of all kinds, auto parts, plastic raw materials, chemicals, raw materials for textile, garment, leather, shoes, metal…
Vietnam – Japan still has a lot of potential to develop trade relations. Participating in many FTAs and existing cooperation mechanisms as I have just shared is an important basis for promoting sustainable cooperation, opening up many new and promising opportunities in the development of bilateral trade. between the two countries.
During the recent complicated and stressful period of the COVID-19 epidemic, despite being affected by epidemic prevention measures in both Vietnam and Japan, the two sides’ trade turnover still grew by 6.4% the first 10 months of 2021.
Currently, Vietnam has moved to a stage of safe, flexible adaptation and effective control of the COVID-19 epidemic. Japan also just eased epidemic prevention measures, reopened from November 8, 2021 and announced a record-high economic stimulus package, amounting to 490 billion USD.
According to my forecast, the demand of the Japanese market will continue to increase, creating favorable conditions for Vietnam’s exports to Japan to grow stronger in the coming time.
In order to penetrate deeply and sustainably into the Japanese market, Vietnamese enterprises need to overcome the market’s very high import standard barriers as well as strengthen trade promotion and construction measures. Brand building and penetration into Japanese distribution channels.
In the coming time, the Ministry of Industry and Trade will continue to strengthen trade promotion measures in a new form, going deep into each locality of Japan. On the occasion of the Prime Minister’s visit to Japan, the Minister of Industry and Trade will join the Governor of Wakayama Prefecture to sign a Memorandum of Understanding on strengthening cooperation in the field of industry and commerce between the Ministry of Industry and Trade and the People’s Government of Wakayama Prefecture. One of the important contents of this Memorandum of Understanding is that Wakayama will assist Vietnam in enhancing trade promotion activities in Wakayama and the Kansai region.
At the same time, the Ministry of Industry and Trade will organize a series of events to advise on import standards of markets for interested Vietnamese businesses, including the Japanese market. This is an activity in the series of events that the Minister of Industry and Trade has just launched on November 18, 2021.
SECOND DIRECTION – ASEAN
Ranked fourth in the world in terms of scale, ASEAN is a potential market for Vietnamese goods. In order to continue to exploit this market well, experts say that businesses need to carefully study the unique needs of each small market, have a good product strategy to increase competitiveness.
According to the General Department of Customs, compared with the time of joining the ASEAN Free Trade Area (AFTA), the total import and export turnover between Vietnam and ASEAN has grown by leaps and bounds, from 5.9 billion USD in 1996 to 57.5 billion USD in 2019. In 2020, despite the negative impact of the Covid-19 epidemic, the total import and export turnover of Vietnam – ASEAN still reached 53.7 billion USD, an increase of 9.1 times compared to 1996, accounting for 9.8% of the total export and import turnover of the country. In the first seven months of 2021, the total bilateral trade turnover between Vietnam and ASEAN reached 40.9 billion USD, up 39% over the same period in 2020.
ASEAN is Vietnam’s fourth largest trading partner; in Asia, ASEAN is the second largest export market and the third largest import market of Vietnam. Notably, the structure of exports from Vietnam to ASEAN is actively shifting from agricultural and aquatic products and fuels and minerals to processed and high-tech industrial products. In 2020, Vietnam’s main export products to ASEAN include iron and steel of all kinds; electronic products and components; devices; phones and accessories; rice; textiles; means of transport and spare parts… 6 markets are Thailand, Cambodia, Philippines, Malaysia, Indonesia, Singapore, accounting for about 96% market share of Vietnam’s goods exports to ASEAN.
In fact, Vietnamese goods still have many opportunities to penetrate the ASEAN market because this region has a growing middle class, many similarities in lifestyle, culture and close geographical distance. Hence Thai market prefers Vietnamese dried fruits and textile products; Indonesia and the Philippines have a need to import many generators, water pumps, telecommunications equipment…
After many years of exporting goods to ASEAN countries, this is a market that is not too strict and convenient in terms of transportation and logistics. For example, Singapore is an economy without agriculture, so Vietnamese agricultural products and food have many opportunities. With the advantage of being a gateway to the world, where many multinational corporations are concentrated, exporting to Singapore helps Vietnamese goods have the opportunity to reach many big customers in the world.
To continue exploiting export markets, in which the ASEAN market has a large space and a population of nearly 700 million people, the Ministry of Industry and Trade has implemented many synchronous solutions. Currently, the Ministry is closely coordinating with localities and businesses affected by the Covid-19 epidemic to focus on controlling the epidemic, in combination with removing difficulties in production and business, and connecting with partners…
The Ministry focuses on training the business community to understand and properly apply the rules of origin to take advantage of the preferences of the Trade in Goods Agreement. ASEAN. At the same time, promote cooperation mechanism so that the ASEAN economic community can form linkage chains in the production and consumption of goods, and enhance investment attraction. Innovating trade promotion activities, connecting Vietnam – ASEAN supply and demand in the online environment, simplifying administrative procedures, implementing import and export administrative procedures under the National Single Window, an ASEAN door… these are solutions the Ministry is actively implementing.
THIRD DIRECTION – CHINA
In recent years, China’s business environment has improved markedly and is becoming an increasingly attractive investment destination. In the first seven months of this year, China attracted more than 672 billion yuan in foreign investment, up more than 25% year-on-year. In the context of the epidemic, the stable market environment makes China a “hot spot” to attract foreign investment, which also makes more and more Vietnamese businesses choose to invest in China.
With Vietnamese enterprises investing in China constantly growing, in order to help them have a better understanding of China policy and integrate into the Chinese market, Vietnam began to prepare for success and established Vietnamese Business Association in China.
Foreign investors coming to China to start a business, as well as members of the Vietnam Business Association in China understand very well the investment environment in China. China is a safe and stable investment environment. They all know that the security and stability of the social environment are the foundation of economic development, and China is certainly excellent in this area; Secondly, they clearly feel that local authorities are increasingly focusing on serving businesses, and are trying to create a better business environment. There are many policies to encourage start-ups, investment promotion policies, and many free trade zones have been established. This is an extremely attractive policy for foreign investors.
Over the years, China has practically applied measures to encourage and promote foreign investment capital, and protect the legitimate rights and interests of foreign investors. The Chinese market is very easy, and Vietnamese products have been accepted by a large number of Chinese consumers.
The company’s headquarters are popular to be located at the Yantai City Business Incubator, where owners enjoy a free regime of 2 years, the third year onwards halves all costs of renting public space. The local government is especially concerned, always asking owners if there is any difficulty here, so that they can help in time. Therefore vietnamese companies can develop large number of showrooms, the national pavilion of Vietnam in the No.1 furniture trade centers in China such as, RedStar Macallin, import goods center etc., to display product presentation. The companies currently can afford hundreds of employees in different provinces.
As China’s economic development continues to improve, market size is constantly expanding, and consumption upgrading has brought more and more demand for high-quality products, these have creating opportunities for businesses to invest in China.
We can see that China’s economic goal has begun to shift from pursuing GDP maximization to a more stable economic goal, which is more concerned with the social life of the people. The path of economic growth has also opened up two cycles of internal and external cycles, including the production of good quality goods, the high-tech industry is certain to develop stronger in the coming future.
Entrepreneurs are full of confidence about the development in the future. As foreign-invested enterprises, they are very confident in the improvement of China’s business environment, and also look forward to more excellent Vietnamese entrepreneurs coming to China to invest and develop. At the same time, they also hopes to rely on the Vietnam Business.
Association in China to help more Vietnamese businesses integrate into the Chinese market. They also need more new members at the Vietnam Business Association in China, and they always welcome Vietnamese entrepreneurs and Vietnamese experts who are settling, living and working in Vietnam. China soon joined and became an official member of this Association. In the future, the Vietnam Business Association in China will contribute a part of its efforts and dedication to the cause of economic exchanges between the two countries, and become a bridge connecting trade and friendship between the two countries.
Regardless of how successful or popular a Western entrepreneur or company you are at the domestic or regional local level, if your ambitions for development are directed to the East and effective work in this direction, charisma alone will certainly not be enough. It is necessary to constantly cultivate a climate of bilateral exchange and deepening of cooperation in the system of relations between your country and countries where your dedication reaches the heights of its international development even in difficult to understand and hard-to-reach regions. Our Center is designed and called to help solve this problem for hundreds and thousands of subjects of economic activity of the West, we will invariably continue to act as a reliable insight and a bridge to the most distant economies in the new 2022. We will be sincerely glad to welcome all entrepreneurs and top managers, contributing to the growth and prosperity of their well-being in the countries of the East.