Task huge for Vietnam to cut trade deficit with ASEAN
The task of cutting trade deficit with ASEAN is huge for Vietnam as it involves a wide range of efforts from reforming technology to improving product quality, according to trade officials.
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With a population of over 600 million and a growing income, ASEAN is an important trade partner for Vietnam but the problem the country faces is that it imports more than it exports.
Vietnam has been unable to narrow the trade deficit, which has been about US$6 billion since 2010.
By October, 2016, Vietnam’s exports to ASEAN hit US$14.2 billion but imported goods worth US$19.1 billion from the market, creating a deficit of around US$5 billion so far this year.
Myanmar has been a bright point of Vietnam’s exports to ASEAN countries, with export growth rate surging by 93.5% in 2013, 51.7% in 2014, 9.5% in 2015 and 22% by the end of May, 2016.
According to experts, the formation of the ASEAN Economic Community (AEC) has facilitated trade among member countries, allowing goods from other ASEAN countries to enter Vietnam easily and pushing Vietnam’s import bill higher.
On the other hand, Vietnam’s goods have not been very competitive internationally and faced fierce competition and technical barriers to ASEAN markets, slowing down Vietnam’s exports to ASEAN countries.
Another problem is that Vietnamese enterprises lack information on clients and rivals to successfully penetrate ASEAN markets, according to Pham Minh Hoa, from the Dong Anh Electrical Equipment Corporation, adding the Ministry of Industry and Trade (MoIT) should do more to help enterprises.
Pham Thu Hang, General Secretary of the Vietnam Chamber of Commerce and Industry, said to boost exports to ASEAN, Vietnamese enterprises need to reform administration and build appropriate business plans, boost linkages, improve competitiveness and capability to meet market demands.
Enterprises should be flexible and sensitive in identifying and seizing opportunities offered by the AEC to create long-term plans.
An expert from the Department of Processing and Trade for Agro-Forestry-Fisheries Products and Salt Production under the Ministry of Agriculture and Rural Development, advised enterprises to provide updates on legal regulations, especially food safety, and reform technology to produce high-quality products.
A representative from the MoIT said information on ASEAN markets will soon be published on ministry’s website.
The MoIT’s E-Commerce Department also has a general information channel on markets as well as export-import tariff charts.
