Workers process cashew nuts for export at the factory of the Nhat Huy JSC in Binh Duong province (Photo: VNA)HCM City (VNA) – A workshop in Ho ChiMinh City on June 21 gave several recommendations to Vietnamese firms to helpthem capitalise on Middle Eastern and African markets, which are believed to begreatly potential destinations for Vietnamese goods.
Pham Hoai Linh, an official from the Asia-AfricaMarket Department of the Ministry of Industry and Trade, said the MiddleEast consists of 15 countries with the total population of about 320 million.This region has fast economic development and very high per capita income, evenmore than 66,000 USD per year in some countries. Therefore, the purchasingpower and paying capacity of clients in this region are also high.
Notably, due to the climate unfavourable foragriculture, the countries’ demand for agricultural products and food is huge.The Middle East imports up to 80 percent of its food demand, equivalent toaround 40 billion USD each year – a figure forecast to hit 70 billion USD by2035.
Linh noted that Vietnam and Middle Easterncountries boast long-standing diplomatic ties, cooperation and friendship. Theyalso have complementary export structures in which what the Middle East needsare those of Vietnam’s strength like aquatic products, cashew nuts, peppercorn,coffee, textile-garment and building materials, while this region’s exports arealso in demand in Vietnam, including oil and gas products, chemicals andplastics.
However, bilateral trade has yet to match bothsides’ demand and capacity, approximating 14 billion USD in 2018, including 8.7billion USD of Vietnam’s exports.
She said with strong purchasing power andfinancial capacity, the Middle East also has high requirements for productquality. Therefore, Vietnamese businesses should further improve it and adaptproduct designs and packaging to suit local consumers’ tastes, particularly theHalal food standards of Muslims.
On the other hand, she also warned security andpolitical uncertainties, different business customs, and trade frauds in thisregion, recommending businesses to carefully learn about their target marketsand partners before carrying out cooperation and transactions.
Regarding the African market, Nguyen MinhPhuong, head of the Western Asia – Africa division of the Ministry of Industryand Trade, said Africa, comprising 55 countries with a combined population ofabout 1.3 billion, is home to abundant natural resources but local productionremains underdeveloped. Therefore, these countries’ demand for consumer goodsand food is considerable. This region also supplies natural materials and rawfarm produce for Vietnam’s manufacturing and processing industries.
Vietnam exports rice, telephones, electroniccomponents, aquatic products, coffee, apparel and footwear to Africa, which inturn ships raw cashew nuts, cotton, timber, and animal food to the SoutheastAsian nation.
Notably, despite this region’s growing importdemand and not high goods standards, Vietnam still records a trade deficit ofalmost 1 billion USD with Africa.
Phuong also noted certain risks relating todifferent cultures, business customs and payment habits in African markets.Additionally, market information shortage, geographical distance and some tradeprotection barriers have also caused difficulties in tapping into the regionalmarkets.
The official suggested Vietnamese companiesupdate themselves about this region via trade promotion programmes and deviseappropriate strategies to access the markets. They can also open representativeoffices or build bonded warehouses in African countries to facilitate export tothe region.-VNA
VNA
