Bright prospects ahead for exports to Japan and RoK10/05/2023 55
With Vietnamese goods making up only 2.7% and 3.3% in Japan and the Republic of Korea, respectively, there remains a wealth of opportunities open for Vietnamese exports to enter these promising markets, according to the Ministry of Industry and Trade (MoIT).
Do Quoc Hung, deputy director of the Asia-Africa Market Department under the MoIT, revealed that both Japan and the RoK have great import demand in areas where Vietnam has strengths.
Japan imports garments and textiles worth about US$24 billion annually, although Vietnamese export turnover to the market stands at only US$2.9 billion, equivalent to roughly 12% of the market share in Japan.
Vietnam also exports leather and footwear products worth US$823 million to this market, accounting for only 18% of the overall market share.
Moreover, some Vietnamese agricultural exports such as bananas, frozen vegetables, coffee, cashew nuts, aquatic, and wooden products make up just 0.6%, 1.6%, 14%, 5.2%, 22%, and less than 5% of the market share in Japan, respectively.
Hung pointed out that Vietnamese exports to both Japan and RoK enjoy tax incentives under the signed free trade agreements (FTAs) with tariffs placed on garments and textiles, aquatic products, and fruits slashed to 0%.
Meanwhile, other countries in the region such as China, Bangladesh, and India are subject to high tax rates when exporting products to these markets.
However, Vietnamese businesses are currently encountering difficulties in meeting the high import standards set in terms of quality and sustainability for the environment and society, Hung noted.
In addition, local businesses have not fully tapped into distribution channels, with management capacity remaining weak.
Insiders have advised local firms to strictly monitor market requirements and stringent regulations set on food hygiene, safety, and traceability by importers, as well as further exploring consumer trends and tastes in a bid to boost exports to these markets moving forward.
Japan and the RoK are currently the two leading foreign investors in Vietnam. They are also Vietnam’s two major economic partners accounting for more than 20% of its total trade turnover with the world.
- Kenya and Russia to sign trade pact, President Ruto says
- Current trends guarantee big growth in Vietnam - US trade, investment: USABC leader
- US extends duties investigation into plywood from Vietnam
- Việt Nam is South Korea's 4th largest rubber supplier
- Coconut exports forecast to hit 1 billion USD in 2023