Fast e-commerce growth boosts Vietnamese exports

Golden opportunity for export businesses

Nguyen Thanh Hung, chairman of the Vietnam E-commerce Association, said that during the 2017-2019 period, Vietnam’s e-commerce grew an average of 25-30 percent a year. With total import-export turnover surpassing US$400 billion due to implementation of Vietnam’s multilateral and bilateral free trade agreements, e-commerce is essential to further expand its scope. The application of e-commerce in business activities is an indispensable and practical trend in Vietnam.

According to the General Department of Vietnam Customs, cross-border e-commerce currently contributes 21 percent to total global e-commerce revenues, benefiting both buyers and sellers. With its high growth, Vietnam would reach B2C e-commerce retail sales of US$10 billion by 2020.

The world’s major e-commerce platforms, such as Alibaba.com and Amazon.com, have entered the Vietnamese market. Zhang Kuo, general director of Alibaba.com, said exports play an increasingly important role in the Vietnamese economy. More than 32 percent of Vietnam’s small- and medium-sized enterprises have established businesses with foreign partners through online channels. Joining B2B e-commerce platforms helps export businesses directly approach customers, thereby expanding opportunities to access the global market and reducing costs related to traditional trade promotion, such as fairs and exhibitions. Businesses can also deal with customers through online channels or e-commerce websites.

Zoe Zuo, managing director of Innovative Hub, said Alibaba.com is looking for potential suppliers of coffee, rice, garments, confectionery, and jam, suggesting Vietnamese manufacturers contact the firm for advice on finding export opportunities through Alibaba.com. Placing Vietnamese products on this sales channel greatly enhances global export opportunities.

Improving the legal framework for e-commerce

With the importance of e-commerce development, the national e-commerce development program has focused on building payment models, proposing online sales solutions, and enhancing management of e-commerce activities in the online environment in order to help businesses make the most of the benefits provided by e-commerce.

The current legal framework for e-commerce in Vietnam is almost complete. In September 2019 Decision 1254/QĐ-TTg on promotion of the national one-door mechanism, ASEAN one-door mechanism, reform of specialized inspections of imports and exports and trade facilitation for the 2018-2020 period, the government assigned the Ministry of Finance to build a draft scheme on management of e-commerce activities for imports and exports.

Nguyen Thanh Hung said that management of e-commerce activities for imports and exports must be compatible and conform with numerous free trade agreements to which Vietnam is a signatory. In addition, the pace of goods clearance must be accelerated.