08:26 | 17/07/2016 Trade
(VEN) - According to the Ministry of Industry and Trade, Vietnamese exports to Canada reached US$951 million in the first five months of this year, a 1.4 percent increase from a year ago, taking first place in Southeast Asia in terms of exports to Canada and surging to 12th place among countries exporting to this market.
Wood furniture is a major Vietnamese export to Canada
Vietnamese goods prove popular
Major exports to this market include machinery, electric and electronic appliances, wood furniture, footwear, textiles, garments, fax machines and printers. Vietnam turned over US$2.7 billion in exports to Canada in 2015.
According to the Vietnamese Trade Office in Canada, Vietnamese goods are becoming increasingly popular in Canada largely because Canadian businesses have growing demand to persify their supply sources and progressively reducing their reliance on the Chinese market. Meanwhile, Vietnamese companies have also raised their interest in the Canadian market, particularly in market research, access and finding partners. A full array of trade promotion activities were launched in an effort to promote Vietnamese goods to this market. The quality of Vietnamese goods has improved, underlining their strong position in the Canadian market for not only traditional items like textiles and garments, leather and footwear, wood furniture, seafood, coffee and cashew nuts but also high-tech products.
In recent years the foreign direct investment sector has led in exporting to Canada including machinery and electric and electronic appliances. Revenues from these categories reached almost US$273 million in the first quarter of this year, a 123 percent increase from a year ago.
Although a wood furniture exporter, Canada still imports high volumes of wood products, providing opportunities for Vietnam. Vietnamese bedroom furniture, chairs, bed-side cabinets and wardrobes are commonly exported to Canada. Wood furniture has always been among the top five Vietnamese exports to Canada amounting to US$60 million in the first quarter of this year. There remains much room for the growth of wood furniture exports to Canada since this country imports an average of US$1.42 billion worth of wood furniture each year.
The Vietnamese Trade Office in Canada said that there is much room for Vietnamese exports to this country and that the Trans Pacific Partnership Agreement would open up ample opportunities for Canadian-Vietnamese relations to grow, particularly in investment and trade as a result of deep tax cut commitments within the TPP.
However, Canada is one of the strictest countries in the world in terms of quality controls, particularly regarding food. Apart from quality, they have imposed high requirements for packaging.
Moreover, many Vietnamese exports were unable to enter major Canadian distribution channels and had to enter Canada through middlemen in third countries.
To rectify the situation, Vietnamese businesses are recommended to actively strengthen their competitiveness, take part in trade promotion programs and draw-up their own branding plans in order to make the most of the opportunities presented.