There remains plenty of room to boost import-export activities between Vietnam and Singapore thanks to their geographical proximity and membership of major free trade agreements (FTAs), said Cao Xuan Thang, representative of the Vietnam Trade Office in Singapore.
These FTAs include the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).
Furthermore, Vietnam and Singapore are also the only two countries in Southeast Asia that have signed comprehensive trade agreements with both the European Union and the United Kingdom, he added.
Thang explained that Singapore remains highly dependent on imports and has moved to lift restrictions or barriers such as tariffs and non-tariffs on imported goods.
The trade official outlined that Singapore can be viewed as the world’s transshipment market that has a high degree of openness with its total trade turnover reaching approximately US$1.2 trillion last year, a figure that is double the country’s GDP.
All of these factors are anticipated to facilitate the greater export of Vietnamese goods to the island state.
Despite enjoying a number of favourable factors, Vietnamese goods face numerous difficulties in gaining a firm foothold in this market.
“Singapore has a small population, but a high income per capita,” Thang analysed. “Indeed, the demanding market has set stringent requirements for imported goods, especially agricultural products and food.”
Although some Vietnamese enterprises are able to meet requirements relating to quality and design, Singapore reqires large orders, making it difficult for Vietnamese businesses.
Most notably, Singaporean businesses prioritise working directly with manufacturers and require local firms to pay high marketing costs themselves as they seek to sell goods under Vietnamese brands.
Thang revealed that over the years, the Vietnam Trade Office in Singapore has organised trade promotions in support of Vietnamese businesses seeking to gain entry into the market, as well as updating policies on import and export activities.
The Trade Office will continue to provide support for Vietnamese businesses looking to participate in trade fairs and exhibitions in the region as they move to strengthen connectivity, organise online conferences, and help firms approach the market through a number of e-commerce platforms.
