Vietnam - EU Trade Forum 2023: Positioning Vietnam in the supply chain

On November 27, the Ministry of Industry and Trade coordinated with the European Chamber of Commerce (EuroCham) to organize the Vietnam - EU Trade Forum 2023 - "Sustainable Development - Destination in the journey of creating future value chains".

Mr. Ta Hoang Linh - Director of the European - American Market Department spoke at the Forum.

At the event, Mr. Ta Hoang Linh, Director of the European - American Market Department (Ministry of Industry and Trade) said: The EU is currently Vietnam's leading trade partner, the third largest export market, and the fifth largest import market of Vietnam. On the other hand, Vietnam has surpassed Singapore to become the EU's largest trade partner in the ASEAN bloc and ranked 11th among the largest suppliers of goods to the EU (2022 - according to Eurostat).

In recent times, despite difficulties in the market, supply chain, trade and the global economy facing many challenges, Vietnam - EU trade exchange still recorded very positive growth results, with significant support from the EVFTA Agreement.

Specifically, statistics from the General Department of Customs show that the two-way import-export turnover between Vietnam and the EU in 2022 reached 62.24 billion USD, an increase of 9.2% compared to 2021; of which exports reached 46.82 billion USD, an increase of 16.7%, with 10 markets reaching a turnover of over 1 billion USD. Notably, exports to most markets in the EU increased very strongly; many markets achieved double-digit growth such as Ireland (up 45.9%), Denmark (up 40.0%); the Netherlands (up 35.8%); Germany (up 23.1%).

Delegates attending the Forum

Entering 2023, the risk of economic recession, inflation and interest rates remain high, causing a decrease in demand for consumption and import of goods in the EU, significantly affecting trade between Vietnam and this market area. However, this decline is considered temporary and is showing signs of improvement as the decline has slowed down significantly as Vietnam's exports to the EU are expected to recover from the fourth quarter of 2023.

“Clearly, the EVFTA has effectively supported Vietnamese goods to access the EU market. Since the EVFTA came into effect, we have also witnessed a positive shift in the market structure, not only in countries such as the Netherlands, Germany, Belgium, France, but also gradually expanding to smaller markets, niche markets in Eastern Europe, Northern Europe, Southern Europe with impressive growth rates. Typically Poland, Sweden, Czech Republic, Slovenia, Ireland, Denmark, Romania... At the same time, the structure of export goods to the EU market is also increasingly diverse; not only focusing on key products such as phones, footwear, textiles, but also promoting the export of many agricultural, forestry and fishery products to the EU" - Mr. Linh commented.

According to Mr. Ta Hoang Linh, Vietnam is facing many favorable conditions to promote economic, trade and investment cooperation activities with EU partners on the solid foundation of comprehensive partnership and great advantages from the EVFTA. Because EVFTA creates a competitive advantage for Vietnam when currently only 4 Asian countries have signed FTA with the EU, in ASEAN there are only Vietnam and Singapore.

Mr. Gabor Fluit - Chairman of EuroCham

Exchanging views at the forum, from the perspective of European businesses, Mr. Gabor Fluit - Chairman of EuroCham, along with representatives of Airbus and Les Vergers Du Mekong highly appreciated Vietnam's advantages and competitiveness in the region, and expressed many expectations from the market.

The forum focused on positioning Vietnam in the supply chain with EU partners, delving into the “sustainability” aspect of bilateral relations.

In addition, domestic and international speakers also analyzed many limitations and challenges facing the economic situation that still has many potential risks and instabilities, along with the trend of strengthening green and sustainable trade standards. A series of notable regulations such as: Border Carbon Adjustment Mechanism (CBAM), Supply Chain Regulation Against Deforestation (EUDR), Supply Chain Due Diligence Directive (CSDDD)... are considered to have a significant impact on Vietnam's exports to the EU, from industrial to agricultural products.

On the other hand, meeting the requirements of sustainability and “responsibility” also creates new development opportunities for businesses, helping to exploit more effectively the advantages of exported goods, thereby enhancing the value and brand of products.

Representatives of Vietnamese enterprises such as Vinamilk Joint Stock Company and Duy Tan Recycled Plastic Company actively shared lessons learned, practical adaptation, and adjustment of production and business models to meet new standards and development roadmaps associated with green, sustainable, and circular criteria. This is also an inevitable global trend and a mandatory path for enterprises to participate deeply in the new value chain. Accordingly, solutions to green production and fulfill environmental and social responsibilities need to be focused on and promoted further.

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