Vietnam urged to take better advantage of AANZFTA

Developing material resources

Nguyen Thi Hoang Thuy, Vietnamese Deputy Consul General in Sydney and Head of the Vietnamese Trade Office in Australia, said trade between the two countries doubled in the past 10 years, from about US$3 billion to more than US$6 billion. Annual growth reached an average of nearly 10 percent, achieving 22.1 percent growth in 2017. However, bilateral trade remains modest compared with its potential. Vietnamese exports to Australia still account for a small percentage of this country’s total import value, partly due to Vietnam’s confusion in taking advantage of preferences offered by the AANZFTA.

To benefit from this FTA, exports must meet its rules of origin. The experience of Thailand, Malaysia, Singapore and Indonesia - countries that have taken advantage of the agreement effectively - shows that businesses should maintain tight linkages with domestic material producers to ensure sufficient and stable supplies for export production. Businesses can also consider building their linkages with suppliers from AANZFTA member countries for materials that cannot be manufactured by domestic companies or in case domestically produced materials are of low quality.

Enhancing competitiveness

Australian consumers are willing to pay high prices for quality products, but they have very strict requirements in terms of quality. The experience of Thailand, Malaysia, Singapore and Indonesia shows that their businesses have paid great attention to diversifying and improving product quality to enhance their competitiveness. At the same time, they have taken sanitary and phytosanitary or SPS measures to ensure food safety and animal and plant health. In addition, they have invested in technological innovation and applied international standards in quality management, such as ISO 9000, HACCP and ISO 14000, in order to cope with Australia’s technical barriers to trade (TBT) measures. They have also participated actively in SPS and TBT capability enhancement programs funded by their governments and ANNZFTA partners.

In the opinion of Nguyen Thi Hoang Thuy, businesses should attach great importance to building brands for export products. They should create new products of high added value instead of exporting raw materials at low prices. This will help domestic businesses win foreign consumer trust. At the same time, businesses should intensify trade promotion and market access efforts through different channels, for example overseas exhibitions and fairs, trade promotion organizations and business associations.