At the signing ceremony of an electricity purchase contract between the Vietnam Electricity and the Phongsubthavy Group of Laos for Nam Nhuong and Nam Mo hydropower clusters (Photo: VNA)Hanoi (VNA) – Vietnam and Laos have enjoyed growing partnership in all fields, especially economy with two-way trade surging 39.3 percent year on year in the first five months of 2021 to 570.7 million USD.
According to the Ministry of Industry and Trade, along with the thriving partnership in other fields, the bilateral trade has seen good progress to become deeper and more practical.
Strong growth in bilateral trade
Statistics showed that in the 2016-2020 period, trade revenue between Vietnam and Laos expanded stably and hit the target of 1 billion USD per year. Bilateral trade was relatively balanced with export-import structure changing in a sustainable manner and diverse products.
In 2020, due to impacts of COVID-19 pandemic and devastating flooding as well as lockdown and social distancing measures, import-export activities between the two countries faced many difficulties and obstacles. However, bilateral trade has recovered since the beginning of 2021.
In the first five months of 2021, the Vietnam-Laos trade rose 39.3 percent year on year compared to 16.7 percent increase recorded in the same period in 2019 before the pandemic broke out.
In the period, Vietnam’s export revenue hitting 280.3 million USD, up 23.5 percent year on year, while its imports from Laos was 290.4 million USD, a rise of 58.9 percent against the same time last year.
“This is the outcome of political determination of senior leaders of both countries, the drastic directions from authorised agencies and the timely settlement of obstacles to create optimal conditions for businesses from both countries to quickly adapt to COVID-19 pandemic,” said a representative from the Ministry of Industry and Trade.
In order to utilize the opportunities and overcome challenges, especially those from COVID-19 pandemic, the ministry advised Vietnamese firms to enhance their activeness to optimise advantages in exporting goods to Laos and expand the export scale.
The ministry asked businesses to be aware of the significance of the Lao market and define their potential and advantages in the neighbouting market to design proper business strategies.
On the foundation of the sound political and diplomatic ties between the two countries, the Government of Laos has supported and created favourable conditions for Vietnamese enterprises to engage in investment and business activities in Laos. With eight international border gate pairs, seven main border gate pairs and 18 auxiliary border pairs, both sides enjoy favourable conditions for economic exchanges, travelling as well as import-export activities.
Meanwhile, trade between the two countries has benefited from the cutting of export tariff to zero percent thanks to the ASEAN trade agreements and the Vietnam-Laos bilateral trade agreements as well as the Vietnam-Laos border trade deal.
Lifting up bilateral partnership
Currently, Vietnam is the third largest investors in Laos. The neighbouring country is also the leading destination for Vietnamese investors with projects mostly in the areas of energy, banking, industrial tree farming, and garment and textile.
Laos has called for foreign investment in infrastructure building, farming, and breeding. Vietnamese firms are also eying opportunities to export more products to Laos, including steel, transport vehicles, machineries, equipment, fertilizers, and animal feed.
The Ministry of Industry and Trade held that Vietnamese firms should grasp the opportunities from the Vietnamese investment wave to Laos to expand their export scale.
The ministry underlined the need for them to strengthen connectivity to form production and supply chains, and build the Vietnamese goods’ trademarks in Laos to clinch their position in the market.
The ministry also pledged to continue to support Vietnamese firms in seeking opportunities in Laos and expand the market for Vietnamese goods.
Along with localities sharing the border with Laos, the ministry has coordinate closely with relevant agencies to ensure smooth border trade activities between the two countries, contributing to the growth in bilateral trade ties, said the ministry’s representative./.
