Exporters yet to optimize FTA incentives

Vietnamese goods have undergone the first step of direct penetration into overseas markets as trade promotions in general have not been carried out uniformly and synchronously from marketing to market entry.

According to the Import-Export Department under the Ministry of Industry and Trade, the country’s key exports have penetrated a number of major overseas markets while having enjoyed stable growth.

Of note, Vietnamese rice products are available in more than 150 countries and territories. Besides traditional markets, local rice exporters have spread their footprint to Americas and Middle East countries. Categories of premium dried white rice, round grain rice, and fragrant rice have initially captured the interest of demanding importers, thus further leveraging Vietnamese rice products to tap into the global market.

The overseas shipment of fruits and vegetables has also been enjoying an upbeat trend. Most notable are a series of tropical fruits, including lychee, longan, rambutan, dragon fruit, and star apple which has conquered the US market while lychee has managed to enter Australia, Malaysia, and some EU member countries.

However, the department said that the advantages of the free trade agreements (FTAs) Vietnam inked is yet to be well utilized due to a string of weaknesses related to production and trade promotions.

The department picked up local exporters’ restricted capacity in seeking new markets as the first shortcoming. In fact, Vietnam, by negotiations on free trade agreements (FTAs), has managed to have tariffs on Vietnamese farm produce cut down. Howver, how to persuade these importers to certify the quality management, safety and hygiene, and quarantine work for Vietnamese agricultural products remains deadlocked.

As a result, despite being immune from tariffs, local farm produce have not been permitted to enter many overseas market. These products include milk, pork, and some kinds of vegetables and fruits.

Agricultural production is another weakness. Though efforts have been raised to handle the historically fragmented and small-scale production of some farm produce, it still fails to meet requirements for large-scale commodity production and high standards set by overseas market.

Meanwhile, the efficiency of export promotion falls short of expectations. The Import-Export Department clarified that Vietnamese goods have undergone the first step of direct penetration into overseas markets as trade promotions in general have not been carried out uniformly and synchronously from marketing to market entry.

In addition, efforts made to seek new importers and increase the efficiency of trade promotions such as fairs and exhibitions have yet to bear fruit as expected, while funding for trade promotions remain modest in comparison with the requirements for maintaining and developing overseas markets.