Vietnam, Peru, and Chile are all members of the CPTPP Agreement, which has contributed to increasing trade relations between Vietnam and these countries.
“Push” from the CPTPP Agreement
At the invitation of the President of the Republic of Chile Gabriel Boric Font and the President of the Republic of Peru Dina Ercilia Boluarte Zegarra, President Luong Cuong will lead a high-ranking Vietnamese delegation to officially visit the Republic of Chile, the Republic of Peru and attend the 2024 Asia-Pacific Economic Cooperation (APEC) Summit Week from November 9-16, 2024.
Informing the press about the contents related to this visit, Deputy Minister of Foreign Affairs Nguyen Minh Hang said that this is the first foreign trip of President Luong Cuong in his new position, with special significance and importance both bilaterally and multilaterally.
On this special visit, looking back at the bilateral trade relations between Vietnam and the two South American countries mentioned above, it can be seen that bilateral trade has grown strongly in recent times.
Currently, Peru, Chile and Vietnam are all members of the CPTPP Agreement. Statistics from the Ministry of Industry and Trade show that, after 5 years since coming into effect in January 2019, CPTPP has played an important role in promoting Vietnam's trade with markets in the Americas, especially member markets including: Canada, Mexico, Chile, and Peru (in which Canada, Mexico and Peru are the markets that have FTA relations with Vietnam for the first time).
According to the General Department of Customs, the total import-export turnover to CPTPP markets in the Americas increased by 56.3%, from 8.7 billion USD in 2018 to 13.6 billion USD in 2023, despite this being a period with many challenges such as the global economic recession and the Covid-19 pandemic. Of which, Vietnam's exports to these markets nearly doubled, from 6.3 billion USD in 2018 to 11.7 billion USD in 2023. The trade surplus in these markets also increased nearly 3 times, from 3.9 billion USD to 11.01 billion USD, contributing positively to Vietnam's macroeconomic stability in recent times. This result has significantly contributed to Vietnam's trade with the Americas in general, with the total import-export turnover in 2023 reaching 137.7 billion USD, of which Vietnam exported 114.5 billion USD. In particular, trade between Vietnam and partners such as Canada, Mexico, Chile, Peru, etc. has improved significantly.
In fact, before that, we had the Vietnam - Chile Free Trade Agreement but it was a traditional agreement and on a small scale. With CPTPP, for the first time we simultaneously access two markets in South America, Peru and Chile, along with two markets in North America, Canada and Mexico. This creates a great opportunity for Vietnam to access new markets with great potential.
According to the Department of European and American Markets - Ministry of Industry and Trade, after three years of implementing the CPTPP Agreement, Vietnam's exports to the CPTPP market in the Americas have had very impressive growth, especially markets such as Canada, Mexico, Chile... These results show that the CPTPP Agreement has had positive impacts, whether directly or indirectly, on Vietnam's exports to this market.
Regarding the structure of our export products to these markets, the main products are phones and components; machinery and spare parts; textiles; footwear, etc.
Increasing trade turnover between Vietnam and Peru, Chile
More specifically, for Chile, 2024 marks the 55th anniversary of the establishment of diplomatic relations between Vietnam and Chile. Over the past 55 years, Vietnam-Chile relations have been developing positively, especially in the field of trade. Two-way trade turnover has quadrupled over the past decade, reaching 1.5 billion USD in 2023.
Currently, Chile is one of Vietnam’s leading partners in the region; it is the first Latin American country to sign a free trade agreement with Vietnam (in 2014). Accordingly, the visit will bring “new vitality” to the Vietnam-Chile relationship, especially in areas where the two sides still have much potential for cooperation.
In the first 9 months of 2024, bilateral trade between the two countries reached 1.24 billion USD. Of which, Vietnam's export turnover to Chile reached 983 million USD, up 5.4% over the same period last year.
For Peru, Peru is currently the country with the largest direct investment of Vietnam in Latin America; is the 6th largest trading partner of Vietnam in the region, while Vietnam is the largest trading partner of Peru in ASEAN. Bilateral trade turnover in 2023 will reach nearly 500 million USD.
In the first 9 months of 2024, bilateral trade between the two countries reached approximately 400 million USD. Of which, Vietnam's export turnover to Peru reached 344 million USD, down slightly by 1.6% over the same period.
Although Vietnam's import and export to Peru and Chile have grown, we must still recognize that the market's potential and room for exploitation is still large and we can do better. In particular, Peru and Chile are participating in many FTAs... Therefore, we must find a way to take advantage of economic links to promote the export of goods to other countries in the Americas through Peru and Chile.
Therefore, according to the Department of European and American Markets - Ministry of Industry and Trade, through Chile and Peru, we can take advantage to promote exports to other South American markets because Chile has an FTA with the entire South American common market, MERCOSUR. Therefore, CPTPP can become a "springboard" to help Vietnamese goods take advantage of opportunities in Chile and Peru, and at the same time reach the large MERCOSUR market, before our country has an FTA with this region.
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