The recent economic crisis has proved that domestic businesses should not depend solely on traditional markets like the EU, US and Japan, and should expand investment and business activities into the Middle Eastern and African markets so as to disperse the risk, a senior official said on September 20.
Bui Thi Thanh An, head of the Vietnam Trade Promotion Agency (VIETRADE)'s HCM City office said at a seminar that there is huge demand for Vietnamese goods, especially for consumer goods, machinery, food, medicine, textile, rice, seafood and agricultural products, in the Middle Eastern and African markets.
Ly Quoc Hung, head of the Ministry of Industry and Trade's Africa-Western Asia-Southern Asia Department, said product diversification and intensification of promotional programmes are key for domestic businesses to further take advantage of untapped potentials in new markets.
Vietnamese products are presently shipped to 55 African countries, with Egypt , South Africa , Angola , Nigieria , Ghana , and Algeria being the major markets, he said.
He said domestic businesses should ensure that the brand name and production information on the packaging are printed in English, Arab or other languages specific to the market. Besides, the businesses need to thoroughly understand local customs and tastes.
Vietnamese firms should visit these markets and commercial centres to meet local businesspeople and seek ways to co-operate. Participation at conferences and trade fairs was also necessary, Hung said.
"Vietnamese firms should not try to establish co-operation through the Internet because the risk of being cheated in business, especially in Western and Central Africa, is high," he said.
Some markets like Mali, Mauritania, Niger and Cape Verde, which were developing countries, offer many investment opportunities in infrastructure and supply of staple goods, he said.
He also cautioned that Middle Eastern and African countries had trade barriers, including complicated and slow procedures that Vietnamese businesses should be aware of.
In the first six months of this year, Vietnamese exports to African countries reached $1.692 billion. Major export products were textile, leather shoes, seafood, rice, coffee, pepper, rubber and wood products, while import items, worth $548 million included plastic material, oil, chemicals and steel.
Two-way trade turnover between Vietnam and African countries is expected to reach $3.1 billion this year, an increase of 70 per cent over last year.
The Middle Eastern region, comprising 16 countries, is a highly promising market, but Vietnamese exporters have not been able to tap its potential.
The region accounts for three-fourths of oil reserves in the world. It has huge potential in finance and huge capital resources. Besides, Israel presents great potential in biotechnology and hi-tech industries.
The tourism potential in these markets is also high with opportunities present for businesses on both sides, speakers said at the seminar.
Currently, Kuwait has offered loans worth $140 million to Vietnamese investors for infrastructure development in its mountainous region.
Saudi Arabia has now a huge demand for migrant workers and can take in 400,000-700,000 Vietnamese labourers. Saudi Arabia plans to cooperate with Vietnam in implementing vocational training projects.
In the first nine months of the year, two-way trade turnover between Vietnam and Middle Eastern countries is estimated at $3.5 billion, of which Vietnamese exports account for $1.62 billion.
An said VIETRADE will continue to take measures to help Vietnamese businesses step up their exports, such as organising conferences and seminars for providing market information to businesses and sending trade delegations to study potential markets.
From September 25 to October 2, VIETRADE, in collaboration with the Ministry of Industry and Trade and the national agency covering small and medium-sized enterprises in Benin, a country in Western Africa, will organise a trade promotion programme. The aim is to study the market and organise B2B (business-to-business) meetings.
Benin is a country with plentiful sources of raw material including cashew, timber, seafood and minerals that are now scarce in Vietnam.