Middle East – Vietnam’s potential export market

For a long time, Vietnamese exporters have paid much attention to its traditional markets such as the US, EU, and Japan but forgotten Middle East market while economists said that Vietnam has highly comparable and competitive advantages in the Middle East because this market is easy to access and not highly demanding for quality.

Workers of Thai Tuan Textile and Garment are producing commdities for exports to Middle East (Photo: SGGP)

Workers of Thai Tuan Textile and Garment are producing commdities for exports to Middle East (Photo: SGGP)

Middle East is a potential market for Vietnam with 400 million people comprising 16 nations. The region spends $40 billion on food and it will be $70 billion by 2035.
Many countries in this region are channeling their trade and investment activities to the East; accordingly it is an opportunities for Vietnamese goods to penetrate and increase its presence in this market.
For years, bilateral trade between Vietnam and Middle East has grown. For instance, in 2016 and 2017, two side export-import turnover was $8.06 billion and $12 billion respectively; of the amount in 2017, exports and imports from Vietnam to Middle East totaled $9 billion and $3 billion.
Vietnam sells mobile phones, shoes, textile products, rice, pepper, wooden furniture items, cashew, vegetables and coffee to Middle East. Of which, rice grew 242 percent in 2016 to achieve revenue of $97 million and vegetables increased 53.4 percent.
As per the Ministry of Industry and Trade, a resident in middle east countries spend a lot on consumption and average GDP per capita in the region is $60,000 – 127,000 annually. Consumer goods, agro-products are two major commodities these countries in the region buy most for local consumption and for tourism.
As there has been a large number of immigrants and tourists to the middle east countries, they need various kinds of commodities. Moreover, they play as middle market to re-export to North Africa and Central Asia.
However, the Ministry noticed about the risks of doing business here such as political unrest, religion conflicts and terrorism. The Ministry warned of fraud; accordingly, Vietnamese enterprises are advised to be vigilant about too attractive deals.
Le Thai Hoa, Deputy Director General of the Africa, West Asia and South Asia Markets Development under the Ministry of Industry and Trade, middle east countries have high demand of relative high commodities.
To facilitate Vietnamese exporters to sell commodities in the next time, the government will simplify paper formalities on taxation, apply one-door policy and reduce clearance time in international ports. The Ministry had simplify several administrative process for facilitation of import-export companies.
Deputy Director of the Ho Chi Minh City-based Vietnam Chamber of Commerce and Industry (VCCI) Nguyen The Hung said in a bid to help Vietnamese enterprises to access to potential market for better cooperation and export, VCCI often organize exchange conference and business trips to foreign markets for local exporters.
Subsequently, UAE’s Relam Investment and Vietnam’s MIG Holdings signed an agreement on the implementation of TRADE-HUB in Vietnam. MIG Holdings Director Nguyen Duy Phuong said TRADE-HUB Vietnam is scheduled to operate in July, 2018 which will be a center connecting producers, service suppliers and financial institutions for Vietnamese and middle east firms.
The TRADE-HUB will organize activities including trade promotion, logistic service connection, appropriate payment methods for each market as well as test partners’ capacity to reduce risks for enterprises, he added.

By MINH HAI – Translated by UYEN PHUONG

Other news

Most view

The VN-Index of the Ho Chi Minh Stock Exchange (HoSE) rose 21.12 points on July 18 (Photo: VNA)

VN-Index rises over 21 points

The VN-Index of the Ho Chi Minh Stock Exchange (HoSE) rose 21.12 points on July 18, with 223.9 million shares worth over 4.9 trillion VND (211 million USD) traded. 

Banking-finance

VNPT & SeABank cooperate to enhance connections

The Vietnam Posts and Telecommunications Group (VNPT) and SeABank just co-signed cooperation agreement, aiming to develop the two sides’ economic, business and investment potential.


Economy

185 leading domestic & in't enterprises join in VN ETE 2018

The Vietnam Exhibition of Electrical Technology and Equipment (Vietnam ETE 2018) and the Exhibition of Products, Technologies for Energy Saving and Green Power (ENERTEC EXPO 2018) yesterday kicked off in HCMC’s Saigon Exhibition Convention Center in district 7.

Self - introduction

VNPT targets to be leading digital service provider in Vietnam

The grand opening ceremony of the VNPT-Information Technology Company (VNPT-IT), a new member of the Vietnam Posts and Telecommunications Group (VNPT), was held yesterday in Hanoi. With thousands of IT engineers and the focus on developing state-of-the-art technological products related to Artificial Intelligence (AI), Bigdata, and Blockchain, the new company is considered the main force to help VNPT fulfill the goal of becoming a leading digital service provider in Vietnam and an important Digital Hub of the neighborhood as well as the world.

Stock market

SAS profits VND 118bln

The Southern Airports Service Joint Stock Company (Sasco) which is listed under code SAS on the Unlisted Public Company Market (UPCoM), announced its second quarter’s financial report with net revenue at VND 634.5billion, an increase of 14 percent compared to last year.