Businesses must be well equipped to fully take advantage of EVFTA

0 Comments

1103 4037 5 Tuan - Businesses must be well equipped to fully take advantage of EVFTA
Mr. Le Anh Tuan

Since the EVFTA came into effect, how have Hapro’s exports to the EU market progressed, sir?

Hapro is a large import-export enterprise. Every year, Hapro exports over US$100 million to markets in over 80 countries and territories around the world. For Hapro, since the EVFTA came into effect, transactions have been very favorable thanks to tariff preferences which help Vietnamese enterprises’ goods be more competitive in the European market. As a result, export turnover in this region has increased markedly.

Ms. Nguyen Thi Hoang Thuy, Commercial Counselor of the Vietnam Trade Office in Sweden: Enterprises should promote exploitation of niche markets in the Nordic region.

Currently, Vietnam’s export turnover to the Nordic market is quite modest, with a small market share. Therefore, this is a potential market to exploit. However, due to the small population and low demands, the remote geographical distance, stricter standards than other EU countries, Vietnamese enterprises must be well equipped to enter this market successfully. As a matter of fact, large Vietnamese enterprises are not interested in Nordic orders, while small enterprises sometimes do not meet the requirements. Therefore, import enterprises in this region tend to import Vietnamese goods through major import hubs in the EU.

To increase the presence of Vietnamese goods in the Nordic region, businesses should pay attention to the niche market. Vietnamese enterprises need to get out of a safe position and enter niche markets; special market segments because they are small but less competitive, with high value.

Nordic people are inherently concerned about the environment, after the pandemic, this issue is even more of a concern. With food, consumers prefer organic food, simple products, using recycled materials. The green and clean trend is not only favoured in Northern Europe but also in many other world markets. Consumers pay close attention to label certifications. They are willing to pay for a fully certified product even if it costs 20-50% more than the regular product.

Mr. Nguyen Quang Hai, General Director of International Supply Chain Joint Stock Company (TH Group): Imports of goods and machinery from the EU skyrocketed after the EVFTA took effect.

The EU is a long standing market of the livestock industry with most of the leading large scientific and technical companies in the industry. TH Group always hopes to access import markets supplying agricultural products in the EU. However, in order to access the market as well as import machinery, equipment, raw materials, and animal feed for the agricultural sector of TH Group from the European market are not simple. Thanks to the EVFTA, the Group’s volume of imported goods from Europe increased, especially in terms of goods serving the agricultural industry. It is expected the EVFTA will continue to be a pedestal for businesses in the coming years.

Amid the outbreak of Covid-19, what are the difficulties faced by businesses in taking advantage of the EVFTA to promote the export of goods to the EU market in particular as well as many other markets, sir?

Under normal conditions, trade exchanges between Vietnam and the EU bring very good economic results, but things have gone wrong due to negative impacts of Covid-19.

Recently, the disruptions to the global supply chain, including transportation, have pushed freight rates up. Besides, enterprises have to face many difficulties such as: unsecured labor supply, social distancing, “3-on-the-spot” production, which affect goods supply, import and export issues. Notably, currently, in Vietnam and some other countries labor costs and production costs are high, leading to high product prices, while the demand for customers in other markets is quite low.

Finding export partners is one of the biggest difficulties faced by businesses in the context of the pandemic. What about Hapro, sir?

Finding customers in foreign markets is the key point in the existence of one business especially amid the Covid-19 pandemic because they can’t take foreign business trips as well as have trade promotion at international fairs in the last two years.

However, thanks to very good relationships with foreign trade partners in addition to the support of Vietnamese ambassadors and trade representatives abroad, Hapro has faced no difficulties in connecting with customers and finding new customers.

In exports, the most important thing is still finding customers in foreign markets. That’s what many businesses can’t do, especially in the last two years, businesses can’t have foreign business trips, trade promotion at international fairs. However, Hapro has very good relationship channels with foreign trade organizations. The support of Vietnamese ambassadors and trade representatives abroad has facilitated Hapro in connecting with customers and finding new customers.

On the basis of having initially made good use of the EVFTA, successful export growth to the EU, what is the key point to help businesses promote and take advantage of this agreement?

Businesses often liken the EVFTA to a “highway” set up for Vietnamese businesses to go forth to the European market. In contrast with that analogy, the EVFTA is not favorable for all businesses and for all goods. It is important for businesses to prepare their own luggage. Simply put, if they want to go on the highway, businesses cannot use rudimentary vehicles and goods must ensure a “visa” to enter the EU market. In other words, goods must ensure quality to penetrate the market.

What recommendations and suggestions do you have to lift obstacles for businesses and boost exports to the EU market in particular and other markets in general?

In fact, in recent times, the Government, Prime Minister, ministries, branches and provinces are also focusing on removing difficulties for businesses. Currently, some cumbersome administrative regulations hinder enterprises, especially in circulation and travel. More than ever before, uniform regulations must be reinforced, especially in traffic, to facilitate travel from one place to another.

Recently, Hapro went to Nam Dinh to export a shipment of cinnamon. However, even though Hapro employees have had two doses of vaccine and went from green areas but they still required isolation, which is very detrimental to businesses.

Such problems need to be removed and a common policy should be made to apply to all provinces and regions. For example, the green zone must be applied the same policy, the yellow zone are uniformed. Only then can businesses be proactive in circulation and travel.

Thank you very much!

Categories:

Leave a Reply

Your email address will not be published. Required fields are marked *