Is it because Vietnam’s “desired” market is now the United States of America, its exports to EU has lost their track?

The above question arose from the recently claimed result of the study on Vietnamese enterprises which export goods to European Union (EU).

The result of the study carried out by Central Institute for Economic Management (CIEM) showed that in comparison with the U.S market, the newly exploited market of Vietnam in recent years, EU market seem to be “abandoned”.

Although export values keep increasing, Vietnam’s export proportion to EU tended to decrease, in comparison with other markets’ one, from 22% in 1998-1999 to 18% in 2004 and 17% in 2005. Meanwhile, export proportions to other major markets increase, such as the United States (from 29%/year to 70%/year) and East Asia.

According to the study group, the exporting structure of Vietnam’s goods to EU is slowly improved as the proportion of produced and processed goods to raw ones increase only about 2.5% compared with Vietnam general export’s average of 8%.

Besides, exports to EU focus on few articles such as footwear (38%), garments and textile (14%), wooden furniture (10%), coffee (7%), and seafood (4.7%).

The study group concluded that the relative fall in the EU’s export proportion to other countries’ is considered as the result of the market and exported products diversity policies of Vietnam.

So, according to economists, Vietnam’s exports to EU need to change from mind to continuously tap into EU, the biggest exporter and the second biggest importer in the world.

Exchanging views with VnEconomy, Mr. Vo Tri Thanh (PhD), manager of International Economic Integration Policies Research Department (CIEM), said that there were three things that Vietnamese enterprises should consider when exporting to this market.

The first thing he mentioned is that we should have the view from EU market’s demands including purchasing power, consumers’ tastes, diversity as well as market segmentation, population and so on. The most important factor here is the ability to adapt to foreign markets. In the world playground, never say that you will not make one product just because you do not like it.

Exporting to EU, especially in the post WTO period, enterprises should change their thoughts, stop selling as wholesalers and retailers, adapt to the changes of the market, consider market demand as vital parts of its operation, access information actively, and study from the lessons of countries in the world as well as of Vietnam, through which enterprises can restructure their production to gradually satisfy market demand.

The second matter is EU’s barriers as well as how enterprises respond to those barriers. Enterprises should accept the barriers and improve their ability to adapt to barriers on food hygiene and safety, anti dumping, and other technique barriers of EU. Instead of being passive as, they should actively take initial action so as to control their products.

The third matter is that many enterprises do not really understand other relating regulations of EU clearly, look down on cooperation and alignment to improve competitiveness.