Strategic Insights for the Vietnamese Import-Export Market

As China's escalating costs drive companies away, Vietnam has emerged as a formidable competitor, experiencing a surge in orders previously directed to the Pearl River Delta. The changing landscape is fueled by a desire to escape rising costs and navigate a complex regulatory environment. Amid the China-US trade war, Vietnam is opening up to international trade and investment, bolstered by trade agreements such as RCEP, EVFTA, and UKVFTA.

Vietnam's Rise as a Business Hub

Strategically positioned for businesses in Southeast Asia, Vietnam serves as an ideal export hub. A leader in low-cost manufacturing, Vietnam's manufacturing sector contributes significantly to the country's GDP and is attracting the attention of businesses worldwide.

Cost Advantages and Regulatory Changes

Labor costs in Vietnam that are only 50% of those in China, coupled with a growing, skilled workforce, make the country an attractive destination. The Vietnamese government's investor-friendly policies, including financial incentives and a low corporate tax rate, further enhance the country's appeal as a sourcing economy.

Vietnam's Economic Dynamism

Vietnam's robust economic growth, particularly in the domestic consumer market, positions it as a vital market for foreign goods. With a population of more than 97 million and a rapidly growing middle class, Vietnam offers significant opportunities for exporters.

The U.S. has become Vietnam's largest export market, surpassing China and demonstrating the country's growing importance on the global trade stage. Textiles, high-tech manufacturing, electronics, pharmaceuticals, automobiles, and coffee are among the sectors experiencing significant growth.

Vietnam Trade Statistics: A Snapshot

Understanding Vietnam's trade statistics provides valuable insights for businesses eyeing the Vietnamese market. The following data illustrates the import-export landscape and the country's leading trading partners.

Vietnam Export Overview

Vietnam has emerged as a global export powerhouse, demonstrating its economic prowess on the international stage. The country's export landscape is characterized by diverse sectors, each contributing significantly to the country's economic growth.

Key Vietnam Export Sectors:

1. Electronics: With major investments from global giants such as Samsung and LG Electronics, Vietnam has become a leading exporter of electronic goods. Smartphones and computer parts have overtaken traditional exports, contributing significantly to export revenues. In 2021, electronics exports will reach a substantial value of US$120 billion.
2. Textiles and garments: Known for its textile industry, Vietnam is a major player in the global apparel export market. The growth of the sector has been remarkable, making Vietnam the world's second largest exporter of ready-made garments. By 2021, textile and garment exports are expected to reach US$40 billion.
3. Pharmaceuticals: Vietnam's pharmaceutical market is poised for significant growth. With the goal of achieving universal health coverage, government initiatives and a growing consumer base are contributing to the increasing value of pharmaceutical exports. By 2021, pharmaceutical exports will reach US$2.5 billion.
4. Automotive: Although still in its early stages, Vietnam's automotive industry is gaining momentum. The country aims to develop its domestic automotive industry, with notable players such as VinFast making progress and even exporting cars to foreign markets. Automotive exports are expected to reach $2 billion in 2021.
5. Coffee: As the world's second-largest coffee exporter, Vietnam plays a critical role in the global coffee market. The government's promotion of processed coffee over raw beans aims to increase the value of coffee exports. In 2021, coffee exports will reach US$3.5 billion.
6. E-commerce: The rise of e-commerce in Vietnam has led to a significant increase in online trade. The country's growing economy, coupled with a burgeoning middle class, makes it a prime market for foreign investors in the e-commerce sector. E-commerce business is expected to grow by 18 percent to reach a value of US$11.8 billion by 2020.

Vietnam Import Landscape

Vietnam's import dynamics are driven by the need for intermediate goods and capital goods that contribute to the development of its industries. The country relies on imports to fuel its manufacturing sector and ensure a steady supply of materials for production.

Major Vietnam  imports:

1. Computers and electrical products: Accounting for a significant portion of Vietnam's total imports, computers, electrical products, and their components are critical to the country's technology-driven industries. In 2021, the import value of these products will exceed US$30 billion.
2. Machinery: Imports of machinery, instruments, and accessories are essential for various sectors, including manufacturing and infrastructure development. In 2021, the import value of machinery was US$20 billion.
3. Phones: With the growing demand for telecommunications, the import of phones and related equipment is an important part of Vietnam's import landscape. The import value of phones reached US$15 billion in 2021.
4. Textiles: Despite being a textile exporter, Vietnam imports fabrics to meet the diverse needs of its apparel and textile industries. In 2021, fabric imports were valued at US$2.5 billion.
5. Plastics: Imports of plastics, especially in primary form, support various manufacturing processes and industries. Plastics imports are valued at US$1.8 billion in 2021.

Navigate Trade with Vietnam through the Export Portal

In conclusion, Vietnam is a beacon for businesses seeking growth in the dynamic ASEAN market. The strategic advantages, coupled with a favorable regulatory environment, position Vietnam as a premier trade destination. Seize the opportunities, overcome the challenges, and unlock the full potential of the Vietnam import-export market with Export Portal.

As businesses seek opportunities in Vietnam's vibrant import-export market, leveraging platforms like Export Portal becomes critical. Export Portal streamlines trade processes promotes seamless transactions, and ensures that businesses make informed decisions. Unleashing the potential of Vietnam's import-export market.