Textile and garment products manufactured for export.

Nhan Dan – Due to the negative impact of the global economic recession and financial crisis, the import demand by the economies which have long been Vietnam’s main export markets such as the US, EU and Japan has dropped sharply.

This is one of the reasons for a sharp reduction in turnover of Vietnam’s exported goods in comparison to that in 2008. In this difficult context, seeking and expanding export markets is an important solution to boost export in the coming time.

To fulfill the set target of export growth, according to a lot of experts, apart from further promoting export activities in the main markets, especially in the markets where there have been free trade agreements, it is necessary to seek and expand new export markets such as African and Middle East markets. These markets have still maintained their stable import demand and have not had any sudden changes in their trade policies, whereas their requirements of imports quality are not so strict and not many trade barriers have been imposed on Vietnam-made goods.

So, it is necessary to speed up promotion activities and market research so as to penetrate more comprehensively into these markets.

Le Dinh An, Director of the National Center for Socio-economic Information and Forecast, analysed that in the African market, impacts of the global financial crisis are not so big. The purchasing power of this market is still quite strong because the countries in the continent are the developing or less developed ones. In these countries, there is a very big demand for importing such necessities as textile and garment, food and foodstuff, pharmaceuticals, consumer goods and manufactured products. As a result, the import demand of this region is very suitable for the structure of Vietnam’s exports.

However, importing enterprises in the continent are limited in terms of financial capacities and this is the biggest barrier for Vietnamese exporting enterprises because the financial capacities of these enterprises themselves are also limited. The lack of information about the market is a big difficulty facing the Vietnamese exporting enterprises. In addition, these enterprises themselves are yet to take their real interest in investing in the market.

To be able to exploit the market, in the coming time, trade promotion must be considered as a top activity. In addition to boosting the exchange of high-ranking delegations in order to promote co-operative and friendly ties, it is necessary to adjust the national trade promotion programmes in the market through improving promotion method and limit the number of research and survey delegations with no concrete purpose. It is necessary for units in charge to co-ordinate with some business associations in exploring the market, promoting trade activities according to sectors such as light industry, construction materials and agricultural products.

For enterprises, it is advisable to be more positive and patient in doing market information research and specifying main items of exports to each country, thus gradually creating the motive forces to expand export activities, for example, Algerian market (rice, coffee, pepper), Angola and Kenya (rice, textile and garment products), Egypt (computers and spare parts, pepper, fruits and vegetables and fibre), South Africa (rice, footwear, coffee, computers, electronic products and furniture).

On the other hand, enterprises need to pay attention to consumers’ taste in the market, and at the same time improve their product quality and designs, offer reasonable prices so that they can compete against their rivals in the market.

According to experts’ recommendation, the Vietnamese enterprises should choose business methods in line with the characteristics of the African market as well as their own financial capacities.

Accordingly, the Vietnamese enterprises’ business strategy in the African market should be based on three methods:

Firstly, it is to export through intermediaries. This is a method most of the Vietnamese enterprises have applied so far in order to penetrate into the African market.

The second method is direct export. This is also a method the Vietnamese enterprises have used in countries where Vietnam has Commercial Services or representative offices such as South Africa, Angola, Egypt, as well as some countries with quite developed banking systems and rather strong financial potentials (for example Morocco and Nigeria).

The third method is on-the-spot export with the aim of overcoming difficulties in payment by the African countries due to their less developed banking systems, and reducing cost of transport goods for the Vietnamese enterprises.

For the Middle East market, this is an entrepot market linking Asia and Europe, with high purchasing power of consumer goods. The main advantages are that Vietnam has had diplomatic relations with all countries in the region with many bilateral agreements and protocols being signed, as a result, there are a lot of items of goods the Vietnamese enterprises can export to this market.

However, to exploit this market in an effective manner, in the coming time, it is highly necessary for the Vietnamese enterprises to pay attention to the characteristics of the market, of which special importance is attached to the cultural and religious particularities and the differences in customs between Vietnam and countries in the region.

In addition, it is necessary to note that business characteristics of some countries in the region depend on weather. Payment methods and currencies are also a feature the Vietnamese enterprises need to pay attention to when they signed contracts.

Currently, the structure of Vietnam’s exported goods is suitable to import demand by the Middle East region. The problem facing the enterprises this time is to set up information channels regarding the capacity of goods supply. In addition, product quality and execution of contracts in total conformity with the signed terms is a prerequisite for successful export of goods to the Middle East.

Hai Thu