Free trade pact facilitates VN’s exports to China, ASEAN

Free trade pact facilitates VN’s exports to China, ASEAN 29/04/2010 10:45:00 1241

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Exports of made-in-Vietnam goods to the ASEAN and Chinese markets are set to rise due to the regional free trade area officially coming into effect on January 1, said the Ministry of Industry and Trade.


Under commitments between ASEAN and China , 90 percent of goods are set to be tariff-free between China and the six ASEAN founding members -- Brunei , Indonesia , Malaysia , the Philippines , Singapore and Thailand --in the initial period.


The tariff elimination will be expanded to the four new ASEAN members, including Vietnam, by 2015.


Vietnamese businesses should take full advantage of China’s tariff exemptions to increase exports to the market in the next five years, contributing to gradually reducing the country’s trade deficit, Dao Tran Nhan, Head of the Ministry of Industry and Trade’s Asia-Pacific Department, said at a workshop on opportunities for the export of Vietnamese goods to the China and ASEAN markets, in Hanoi on April 15.


China remains one of Vietnam’s largest trading partners in recent years. Despite the global economic downturn, Vietnam’s exports to the market saw a growth of 8.23 percent to 4.9 billion USD in 2009, accounting for 8.6 percent of the country’s export turnover, according to the official.


But, the trade balance favours China as Vietnam’s exports to the market make up only 0.48 percent of China’s total import turnover.


To improve the two-way trade balance, the Ministry has sent China a list of 16 Vietnamese goods for import and asked the latter to encourage its businesses to increase the import of the items, which include agricultural, forestry and aquatic products and fruits and vegetables,.


Along with the move, Nhan urged Vietnamese firms to strengthen links with foreign investors to export goods to China. A number of investors from Singapore, Taiwan and Western Europe are moving their production facilities from China to Vietnam, taking advantage of cheaper labour and production costs, and then exporting to the Chinese market.


Also, Nhan attributed Vietnam’s low production capacity in goods for export to the weak competitiveness of its goods in the Southeast Asian region.


He asked Vietnamese businesses to expand their exports in the major regional markets of Singapore, Thailand, Malaysia and the Philippines in order to boost trade cooperation between Vietnam and the Association of Southeast Asian Nations (ASEAN).


Two-way trade between Vietnam and ASEAN reached 22.5 billion USD in 2009, of which Vietnam imported 13.8 billion USD./.