VinFast electric cars pioneer in Israeli market

Israel is considered a center of economics , science, technology and innovation in the region as well as the world. When discussing trade cooperation in the field of science and technology between the two countries, people often only think of Israeli enterprises bringing high-tech products and services to Vietnam for investment and business.

However, speaking with VietNamNet reporter, Mr. Tran Quang Huy, Director of the Asia-Africa Market Department, Ministry of Industry and Trade noted that there are many opportunities and potentials for Vietnamese enterprises, especially Vietnamese science and technology enterprises, to bring "Make in Vietnam" products to Israel.

Mr. Tran Quang Huy, Director of Asia - Africa Market Department, Ministry of Industry and Trade. Photo: BM

According to Director Tran Quang Huy, in the trend of globalization and the 4.0 industrial revolution, the trend of applying advanced production systems and high technology in industrial production will help Vietnamese enterprises have many opportunities to export technology goods to this West Asian market.

Specifically, in the field of electric power, some Vietnamese enterprises have the ability to design and manufacture motors with a capacity of up to 5MW, transformers of all types up to 500KV, with quality equivalent to European products. Vietnam has now become one of the few countries in Southeast Asia capable of manufacturing large capacity transformers, and is moving towards exporting to developed countries.

Or in the industrial sector, the group of electronic industrial products such as: Computers, electronic products and basic components, electronic printed circuit boards, microelectronic circuits, office equipment, audio-visual equipment and components... have many opportunities to export to West Asian countries.

Referring to Vietnamese science and technology enterprises that have pioneered in bringing “Make in Vietnam” products to Israel, the Director of the Asia-Africa Market Department expressed his special impression of VinFast Company’s project of exporting electric vehicles to Israel. Recently, VinFast announced B-EV Motors as the official distributor of its products in a market that is still quite new to many Vietnamese enterprises.

“As far as I know, Israel is making efforts to develop the field of electrification to achieve the goal of 100% of vehicles sold on the market being electric vehicles by 2030. With its existing advantages of a complete transport infrastructure system, low electricity prices, and advanced technology platform, Israel is an ideal market for VinFast to quickly promote the development of electric vehicle products, increasing the presence of this Vietnamese brand in the international market,” said Mr. Huy.

Market of 9.7 million people with many unique features

According to the assessment of the Ministry of Industry and Trade, Vietnam and Israel have great potential to continue expanding the scale of bilateral trade, because the import-export structure between Vietnam and Israel is basically not directly competitive but complementary to each other. Vietnam mainly exports to Israel items such as: Textiles, footwear, wooden furniture, tropical agricultural products, seafood...;: And mainly imports from Israel items such as: Computers, electronic products and components, machinery, equipment and spare parts, fertilizers of all kinds, vegetables and fruits...

Vietnam - Israel trade exchange in the period 2018 - 2022 has good growth momentum.

In fact, in recent times, there have been Vietnamese enterprises in the fields of electronics, processing industry, manufacturing, information technology, high-tech agriculture, etc. that have contacted and requested the Asia-Africa Market Department to support connections, learn about business and penetrate the Israeli market.

“Despite its modest market size, with a population of approximately 9.7 million people, Israel’s economic and foreign trade activities are quite developed. Every year, Israel needs to import many types of goods, including science and technology products to meet domestic demand. However, there are some issues that need to be noted regarding the specific characteristics of this market,” Director Tran Quang Huy shared information with businesses that want to bring Vietnamese products, especially “Make in Vietnam” science and technology products to Israel.

For example, the business practices and habits of Israeli enterprises are to want to buy finished, processed products with high added value, pre-packaged, complete, especially for food and consumer goods (seafood, cashews, coffee, pepper, soft drinks, confectionery, cinnamon, textiles, footwear of all kinds...), including electronics and household goods.

Regarding product quality standards, Israel requires imported goods to strictly comply with local standards, which are often specific in nature. In addition, Israel also applies standards of the European Union (EU), the United States, and carries out quite strict inspection and control. Vietnamese manufacturing and exporting enterprises need to focus on offering high value-added products, scientific and technological products with competitive prices and suitable quality, promptly responding to transactions with Israeli customers, and complying with the requirements on standards and import regulations that Israel has recently issued.

In particular, Israel is a country with religious and ethnic characteristics. Jewish businesses often require exporters to have Kosher certification, while Arab businesses may require Halal certification, for certain types of goods (mainly for food, foodstuffs and consumer goods). These are two types of certifications of a religious nature and often depend on the specific requirements of the importer for each transaction or each shipment.

VIFTA Agreement opens up many new opportunities

On July 25, 2023, Vietnam and Israel signed the Vietnam-Israel Free Trade Agreement (VIFTA). With the agreement reached in all chapters of the Agreement, especially the strong commitment to increase the rate of trade liberalization, the overall liberalization rate, and by the end of the roadmap, Israel's commitment is to reduce up to 92.7% of tariff lines, while Vietnam's is 85.8% of tariff lines, the two sides expect that VIFTA will support businesses of the two countries to promote trade.

Minister of Industry and Trade Nguyen Hong Dien and Israeli Minister of Economy and Industry Nir Barkat signed the Vietnam - Israel Free Trade Agreement (VIFTA). Source: Ministry of Industry and Trade

The Director of the Asia-Africa Market Department assessed that when VIFTA comes into effect, the types of Vietnamese export goods to the Israeli market will become increasingly diverse, with: Mobile phones and components; computers and components; seafood; cashew nuts; textiles and footwear of all kinds; coffee; pepper; machinery and equipment; natural rubber; soft drinks; plastic products; wood products; chemical products; handicrafts, ceramics...

In other words, many new opportunities will open up for import and export goods between the two countries, including high-tech products and “Make in Vietnam” science and technology products.

“The signing and implementation of VIFTA will create favorable conditions for Vietnam to promote the export of its key products not only to Israel but also to have the opportunity to access other markets in the Middle East, North Africa and Southern Europe,” Director Tran Quang Huy emphasized, while noting a number of issues that Vietnamese enterprises need to pay attention to if they want to exploit the incentives and advantages that VIFTA brings.

Specifically, businesses need to understand the important conditions to enjoy preferential tariffs when VIFTA comes into effect. For example, goods must meet the rules of origin specifically designed for VIFTA, and only when meeting the rules of origin will goods be granted preferential certificates of origin.

In addition, Vietnamese enterprises need to proactively survey and research the market, attend fairs, exhibitions, trade promotion events, and trade connections held in Israel, and directly meet with partners to discover each other's cooperation needs, thereby contributing to promoting exports to this market.

On the other hand, businesses also need to regularly monitor developments in political security in Israel, as this is a sensitive area for conflicts and instability that affect the entire region, in order to have timely responses to transactions for signing contracts for the purchase and sale, and transportation of import and export goods, thereby ensuring business interests.

To enhance support for businesses and industry associations as well as promote trade activities between Vietnam and Israel, in the coming time, the Ministry of Industry and Trade (Asia-Africa Market Department) plans to coordinate with a number of related units to carry out a variety of activities.

Regarding market information, the Asia-Africa Market Department will organize seminars and talks to introduce and disseminate information about the Israeli market and the content of VIFTA as well as the benefits the Agreement brings to Vietnamese businesses.

The Asia-Africa Market Department together with the Vietnam Trade Office in Israel will continue to update information on market developments, changes in trade policies, new import regulations of Israel and post them widely on electronic information pages and magazines.

The Vietnam Trade Office in Israel is always ready to support Vietnamese enterprises in verifying and examining the legal status of partners in Israel, supporting Vietnamese enterprises in accessing the market and establishing business cooperation relationships.

“Israeli enterprises are increasingly interested in the Vietnamese market and partners, considering Vietnam as one of the important stable sources of goods in Asia (especially for agricultural products, seafood, processed food, beverages, household goods, electronic products and equipment, consumer goods, etc.) to meet domestic consumption needs. Grasping that need, the Asia-Africa Market Department annually develops a plan to organize trade promotion delegations, connect trade, programs to bring goods into the Israeli supermarket system, and organize weeks of goods at some large supermarkets in Israel, etc. to promote Vietnam's strong products to this West Asian country,” added Director Tran Quang Huy.

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