Businesses tipped to penetrate EU market

The EU has always been an important trade partner of Vietnam, with two-way trade continuing to expand in recent years, despite the global economic downturn.  In 2012, the EU surpassed the US to become Vietnam’s largest export market.

Total two-way turnover reached over US$33.7 billion in 2013, a year-on-year increase of 16%. Of the total, Vietnam exported US$24.3 billion to the EU, up 19% compared to the prior year.

However, Vietnamese goods exported to the EU are overly dependent on foreign businesses operating in Vietnam, according to Nguyen Duc Thuong, Deputy Director of the Europe Market Department under the Ministry of Industry and Trade.

The capacity of Vietnam’s domestic businesses to fully penetrate the EU market is much too limited and hampered by a number of factors, focusing too much on price competition.

The business community needs to study and learn the distribution process utilised by the EU in order to effectively compete on an equal footing, delivering higher quality and higher added value products as an alternative strategy to strictly price competition.  

This will dramatically increase the number of domestic companies actively participating in the export marketplace, bolstering Vietnam’s economy fully benefitting all the people of the nation.

This is particularly important in the context of ongoing negotiations for a bilateral Free Trade Agreement (FTA) which are expected to conclude later this year, Thuong concluded. 

At the seminar, delegates delved into effective distribution systems, procedures, EU import regulations, and EU market demand and lively discussions regarding the advantages and disadvantages to Vietnamese business.

The event was co-organized by the Department of Europe Market under the Ministry of Industry and Trade and European Trade Policy and Investment Support Project (EU-MUTRAP).