On October 29, Prime Minister Pham Minh Chinh departed the UAE for Saudi Arabia as part of a three-country tour of the Middle East.
With the Comprehensive Economic Partnership Agreement (CEPA), the market... Middle East The market is becoming more open to Vietnamese goods thanks to reduced tariffs and extensive cooperation commitments.
With the signing of the CEPA and the phased reduction of tariffs up to 99%, many of Vietnam's key export items to the UAE in particular and the Middle East in general will have more favorable conditions. These include products with competitive advantages such as agriculture , especially high-quality agricultural products, clean and organic products with Halal certification, textiles, footwear, electronics, seafood, and wood products.
Advantages from tax reductions
At a large supermarket in Riyadh, the capital city, many agricultural products from various countries are displayed abundantly on the shelves. A Saudi Arabian customer chose to buy fresh lemons from Vietnam. He said that Vietnamese lemons are not too big and are very juicy, which he really likes. However, compared to markets in countries like China, Thailand, and Malaysia, the presence of Vietnamese fruit in the Middle East is still quite modest.
According to Mr. Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetable Association, fruit exports to Saudi Arabia, the UAE, and other Middle Eastern countries are still modest but are experiencing positive growth. These countries favor citrus fruits, and many fruits are considered refreshing, such as oranges, lemons, and fresh coconuts.
The advantage is that they don't have as high technical standards as the US and EU. While the US and EU require GlobalGAP standards, the Middle East only needs a phytosanitary certificate and VietGAP certification. Furthermore, customs clearance conditions and paperwork are much more streamlined.
Vietnam's fruit exports to the UAE in 2023 reached nearly $60 million, a 30% increase this year (the first nine months reached $51 million), while exports to Saudi Arabia reached $10.9 million.
While considered a niche market with significant potential, it also faces numerous challenges. In fact, some businesses exporting to the Middle East are concerned about unreliable payment systems and the potential risks of transporting goods across the Red Sea. Vietnamese fruit also faces competition from products from China, Thailand, Malaysia, and other countries.
Capacity building requirements
According to the head of the Asia-Africa Market Department (Ministry of Industry and Trade), the main export items from Vietnam, including agricultural products (such as rice, pepper, and coffee), processed foods, and seafood, are in high demand in Saudi Arabia.
The country's high demand for agricultural products and food, seafood, and Halal food presents an opportunity for Vietnam to boost exports. This market also has diverse import needs for consumer goods, industrial products, and construction materials.
Meanwhile, with the advantage of being one of the major trading hubs in the Middle East, the UAE will also help Vietnamese businesses expand export channels and promote key products such as agricultural products, Halal food, seafood, and consumer goods.
Although CEPA will support the growth of Vietnam's key export products, the leaders of the Ministry of Industry and Trade noted that the Middle Eastern market is highly competitive, so Vietnamese businesses must improve their production capacity and meet stricter requirements for quality and Halal certification to gain market share.
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