Senior officials from Vietnam and the Middle East and African nations have gathered in Hanoi on September 9-10 to discuss measures for the further trade between the country and the region.
“Meet Ambassadors from the Middle East and Africa 2019” is a significant step to address issues and the best ways for Vietnam and the countries in Middle East and Africa to overcome shortcomings and unlock potential, strengths, and visions for effective cooperation, Vietnamese Deputy Prime Minister and Foreign Minister Pham Binh Minh made the remark at the event on September 9.
He stressed that Vietnam believes in high potential and extensive cooperation with the Middle East and African countries in the future. However, the two sides need to tackle some obstacles that hinder the cooperation.
Delegates at the panel discussing on promoting goods and service exports between Vietnam, Middle East and Africa: Advantages and Disavantages. Photo: VNA
Challenging issues include lack of information and mutual understanding of the markets, business environment, and regulatory framework, the top diplomat said.
Geographical distances, a sparse network of permanent diplomatic and trade missions coupled with existing weak bilateral cooperation mechanisms are also issues preventing stronger cooperation between Vietnam and that region of the world, Minh stressed.
In addition, lack of regulatory framework and connectivity between Vietnam and the regions remains the problem. Indeed, Vietnam has signed 16 free trade agreements with other countries and regions but none of them with the Middles East and Africa.
In the framework of the conference, there was a panel where representatives from Vietnam’s ministries and localities and ambassadors shared the views on how to settle the aforementioned hurdles.
Trade between Vietnam and the region hit US$20.5 billion in 2018, up 10.2% on year, Deputy Minister of Industry and Trade Cao Quoc Hung said at the event.
Significant results have been achieved in industry and energy sectors with the investment from 33 countries from the Middle East and Africa.
For its part, Vietnam has exported some products to the regions including textiles, footwear, dairy products, coffee, and processed foods, among others.
Meanwhile, Vietnam’s demand for crude oil, diesel, liquefied gas, common metals, and fertilizer from the Middle East and African countries remains high.
Director of Trade Finance Center at the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) Phan Thi Thanh Nhan said that some Middle East and African countries namely UAE, Turkey, Israel, Kuwait, Israel, Saudia Arabia, South Africa, Egypt, Ghana are large buyers of Vietnamese rice, coffee, tea and seafood, among other commodities.
But many Vietnamese firms have been struggling with conflicting payment systems when operating in the region while lots of strict requirements on packaging, quality standards, and certificate for Vietnamese products to enter the market.
Nhan pointed out that African enterprises are partners with great potential but also fraud risks. African banks are still slow at responding and supporting customers.
Hapro Deputy Director General Nguyen Tien Vuong said his business has exported cashews, pepper, rice, coffee, tapioca starch, cinnamon and other agricultural products to the Middle East and Africa since the first days of its foundation. The shipment account for almost 30% of the corporatin's total export turnover.
But slow banking transaction, payment delay and the differences in consumers’ habit and business environment between Vietnam and the Middle East and African countries which are preventing his business from expanding in those markets, Vuong e.
The Hapro executive urged a greater role of Vietnamese ambassadors and trade missions in the Middle East and Africa to improve the performance of Vietnamese companies in these markets, asking them to continue updating market information to the Vietnamese business community and providing support to Vietnamese companies to do business in the region.