A rosy future predicted for Vietnam-Italy trade

08:24 | 15/08/2017 Cooperation

(VEN) - The EU-Vietnam Free Trade Agreement (EVFTA) that takes effect in 2018 is expected to facilitate economic and commercial cooperation between Vietnam and Italy and significantly contribute to increasing bilateral trade and investment. 

a rosy future predicted for vietnam italy trade
Coffee is among major Vietnamese exports to Italy

Speaking at a recent Vietnam-Italy trade promotion workshop in Hanoi, Michele D’Ercole, Chairman of the Italian Chamber of Commerce (ICHAM) in Vietnam, explained why. He noted that Vietnam is a large market with more than 90 million consumers and has the benefit of bilateral FTAs with large partners, such as South Korea and Japan.

D’Ercole said he believes Italian businesses already in Vietnam will seek to take advantage of the trade agreement with Europe, whereas Vietnam may well appeal to the growing number of Italian firms moving their manufacturing facilities from China to neighboring countries.

The potential for Italian investment is also significant given that Vietnam is seeking higher added value for sectors in which Italy enjoys an advantage, such as footwear, textile, garment and agriculture.

Participants at the seminar also discussed the opportunities for Italian companies to cooperate with Vietnamese businesses or promote exports to Vietnam in other fields, such as machinery, processed agricultural products, construction materials, tourism, and environmental protection technology transfer.

According to the General Department of Vietnam Customs, bilateral trade reached US$4.6 billion in 2016 and over US$2.11 billion in the first five months of this year, a rise of nine percent compared with the same period last year. Vietnam currently ranks 15th among exporters to Italy and is the 19th largest importers of Italian products.

Major Vietnamese exports to Italy include telephones and components, coffee, footwear, textiles, garments and seafood. Italian Foreign Trade Association (AICE) Secretary General David Doninotti said Italy has very high demand for imported food and agricultural products. He therefore believes that Vietnamese products will benefit from many opportunities to penetrate the Italian market with its more than 60 million consumers that also offers a gateway to Europe, a market with 500 million consumers.

Doninotti cautioned, however, that his country applies very high value added taxes amounting to as much as 22 percent to most kinds of goods, and that Italian consumers, as well as Italian regulations, are very strict about product packaging and labels. Therefore, to penetrate this market, businesses have to ensure that their products meet strict quality requirements of the EU.

D’Ercole said most Italian consumers still have limited knowledge of Vietnam and Vietnamese goods, but high-quality products will win their trust. “To maintain long-term cooperation with Italian partners, Vietnamese businesses should win their trust,” D’Ercole said.

Italian businesses are keen to explore the Vietnamese market. Bilateral trade relations are expected to expand, especially after the EVFTA takes effect.

Nguyen Huong