Marko Walde, Chief Representative of the German Chamber of Industry and Trade (AHK) in Vietnam, spoke with Vietnam Economic News on the occasion of the 38th anniversary of diplomatic relations between the two countries.
In his opinion, the Vietnamese market is very attractive and has a lot of potential for German companies. With an average annual growth rate of 6 percent, Vietnam is still one of the most potential markets in the whole Southeast Asian region.
It has an increasing demand for high quality products and its young and growing population has a backlog consumer demand. Compared to its neighbour countries like Thailand, the Vietnamese market offers better business possibilities but its market entry structures for foreign companies are still weak.
Nevertheless, legal and administrative processes, for example applying for a work permit for foreigners, as well as high market regulations are still time consuming and complex. A liberalisation of the market would be desirable. For foreign companies with production facilities in Vietnam, the distribution of their products could be facilitated. Also, the support industries could be strengthened and power supply should be assured.
In the opposite side, Walde said that the demand for Vietnamese goods in Germany is also increasing significantly. However, before entering foreign markets, Vietnamese companies need to improve their international competitiveness. For that purpose, they need to be aware of the differences between the ASEAN economies and the German market.
The truth is that a good analysis of the foreign market like the analysis of the differences and similarities between the two markets is a basic requirement to be successful. Visiting German trade fairs or contacting trade fair representatives (like Messe Dusseldorf, Messe Berlin, Nurnberg Messe and Spielwarenmesse) could be first steps to get to know the German market and realise plans of expansion.
“With our role in Vietnam, our main tasks are to promote the economic relations between Germany and Vietnam. We have two service teams with one team being responsible for serving delegations and projects and the second teamp roviding consultancy and support for German and Vietnamese companies to successfully enter foreign markets. We are the official representative of Messe Duesseldorf, Messe Berlin and Spielwarenmesse,” he shared.
Every year, the AHK brings several hundred exhibitors and visitors to Germany and support export-oriented enterprises in Vietnam in developing their markets in Germany and Europe. Besides, the AHK is also the official partner for the federal states Freistaat Bayern and Sachsen-Anhalt. The AHK’s main interest is to strengthen the economic relations between Germany and Vietnam and supports both sides by their business expansion.
“It is clear that we will have more possibilities when the Free Trade Agreement (FTA) between Vietnam and the EU comes into effect. The imports will raise and many of the constraints will be omitted. Going along with these reasons we will recognise an increase of trade on both sides,” he added.
Noticeably, the Asia-Pacific Conference of German Business (APK) will be held from November 21-22 in 2014 in Vietnam. It is a platform for the exchange of ideas among companies and decision makers in Asia. This event has been organised biannually in Asia since 1986 and has evolved into one of the largest networking events in the region attracting both political and business leaders.
Nearly 800 CEOs of leading German companies and top politicians will take part next year to discuss the actual situation of the Asian economy. This is also a great chance for German and Asian companies to get to know each other and exchange their business interests.
“I believe that throughout this event German leading managers will discover Vietnam as a country for their next investment,” Walde stressed.