Firms must try to take advantage of FTAs: experts

Update: 07:05 | 29/07/2021
Russia is a potential market for Vietnamese exporters of farm produce to tap, experts said, saying enterprises should fully take advantage of the Viet Nam-Euroasian Economic Union Free Trade Agreement (VN-EAEU FTA).
Firms must try to take advantage of FTAs: experts
Viet Nam exported 21,300 tonnes of aquatic products to Russia for 72.2 million USD in the first five months of this year. (Photo: VNA)

Statistics from the General Department of Vietnam Customs showed that in the first five months of this year, Viet Nam exported 21,300 tonnes of aquatic products to Russia for 72.2 million USD, representing an increase of 72 percent in volume and 60.4 percent in value compared to the same period last year.

Of these, frozen shrimp of all kinds is the item with the largest export value, with 2,000 tonnes, worth 18.4 million USD, up 69.6 percent in volume and 72.9 percent in value over last year’s figure.

Exports of frozen octopus and pangasius also saw strong growth.

Despite the COVID-19 pandemic, in 2020 the export turnover of vegetables and fruits to Russia still picked up 58.7 percent compared to the previous year to reach 54.4 million USD. It reached 26.2 million USD in the first four months of this year, a year-on-year increase of 32.4 percent.

According to the Export-Import Department under the Ministry of Industry and Trade, Russia has been a traditional export market of Viet Nam since the 1990s, especially for agricultural products such as coffee, pepper, tea, and vegetables.

In addition, Viet Nam is a signatory of the VN-EAEU FTA which covers more than 90 percent of all tariff lines. Of which 59.3 percent of tariff lines have been reduced to zero percent. This is a golden opportunity for Vietnamese enterprises who engage in exporting farm produce to the Russian market.

Since the agreement took effect in 2016, Viet Nam's vegetable and fruit exports to Russia have grown at an average 20 percent a year, which is a very positive sign.

However, according to experts, obstacles remain for the export of Viet Nam's agricultural products to the Russian market, reported Cong thuong (Industry and Trade) newspaper.

The average price of shrimp exported to Russia is higher than that of the three largest suppliers, making the product less competitive and its market share still low.

Vietnamese pomelos have to compete with those of other countries, especially Chinese ones, which have maintained their number one position in the Russian market for decades. Requirements for entry of the product to this market are quite strict, ranging from pomelo varieties to technical standards and food safety.

To maintain growth and improve the market share of Viet Nam's agricultural and aquatic products to Russia and EAEU countries, experts recommend that businesses regularly update information on the implementation of the VN-EAEU FTA.

The focus should be on ensuring the reputation and quality of exported products.

It is necessary for enterprises to promote the export of processed farm produce to reduce the risk of transportation and preservation costs and improve the competitiveness of products in this market, they said.

Experts also highlighted the need to strengthen support for trade promotion activities, improve market forecasting and provide specific information for enterprises to work out plans and expand their business to Russia.

According to customs data of the EAEU, despite being affected by the COVID-19 pandemic, two-way trade between the bloc and Viet Nam still reached about 6.2 billion USD in 2020, up 11.7 percent compared to 2019.

In the first six months of this year, Viet Nam's trade turnover with EAEU member countries is estimated at 2.7 billion USD, an increase of 14.9 percent over the same period last year. In which, exports value from Viet Nam was 1.66 billion USD, a year-on-year rise of 31.3 percent.

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(Source: VNA)