Last updated: Thursday, May 23, 2013
More Support for ExportersPosted: Tuesday, August 14, 2012
Based on statistics from the Ministry of Industry and Trade, the export turnover during the first 7 months of 2012 is US$62.933 billion, 19 per cent higher than the same period in 2011. Products with high turnover include: clothing, phones, footwear, seafood, coffee and crude oil. In order to further support exporters, the Government has recently initiated a program to implement the Strategy for import-export of Goods from 2011-2020 and orientation to 2030. The program is designed to help businesses overcome challenges so as to expand their import-export market.
According to research done by Investment and Trade Promotion Centre (IPTC) based in Ho Chi Minh City during the “Import-Export Forum: Opportunity and Prospect” recently held in the same city, at the moment there is about 30 percent of businesses encountering problems with finding new customers, sale of goods; 23 percent in urgent need of market information; 16 percent having great difficulties in locating financial capital for their operations; and 13 percent having problems with product shipment. Also according to experts, the export businesses in 2012 might not be of much concern, but the most important thing is not the total amount and the growth rate of goods being exported, but the competitiveness of local businesses and how to support the exporting businesses.
According to the approved program, exporting businesses are gearing towards sustainable and relevant development model; both expanding the export scale and improving the value-added products. As such, export growth rate will be 11-12 percent on average from 2011-2020; import growth rate will be 10-11 percent on average from 2011-2020. In addition, in the near future, trade deficit will be reduced, import surplus will be around 10 percent of export turnover in 2012; moving towards balancing the trade balance in 2020 and trade surplus from 2021-2030.
In order to achieve this objective, the Government needs to increase their support for exporting businesses. Apart from tax support, they need to specifically help businesses to reduce production expenses and, in particular, the required fees, especially when there are currently many types of overlapping and high fees. Government offices will continue to identify goods which have potential for export and at the same time establish mechanisms and policies to help develop goods such as: mobile phones, construction materials, petrochemical products, rubber products, and plastic substances. Regarding the clothing and footwear industries, the Government will enact mechanisms and policies to resolve challenges and develop raw and auxiliary materials supply centre for these industries. In the context where big international clothing markets are struggling all over the world, the clothing industry in Vietnam still maintains stable growth. Export turnover of clothing and thread is US$6.2 billion during the first five months of 2012, up 8 perent from the same period in 2011. Exporting clothes alone is worth US$5.46 billion, up 11 percent from the same period last year, and representing approximately 11 percent of export turnover of all industries. During the first seven months, clothing continues to take the lead with an export turnover of more than US$8.2 billion, up 21 percent from the same period last year.
In order to create connections, the Government needs to have policies and mechanisms to encourage the connection among raw materials areas and production, processing and exporting through partnership, association, long-term contracts, supplying raw materials input together with product sales. Upon examining the raw material areas, provinces should encourage investment in these areas, together with production and processing on the spot to aid export. Industry associations should also encourage evaluation tasks, market and pricing forecast, periodic market information and neighbouring countries’ policies awareness in order for members to improve their activeness and reduce risks from market fluctuation.
Acting as a bridge between government agencies and businesses and a representative to protect the legal rights of members in international trade, the associations also quickly help reflect difficulties and challenges in order to proactively have countering measures to help encourage and improve export efficiency and gradually reduce the trade deficit.
Regarding market expansion, programs to promote National Trade will be implemented in the last several months of the year in order to help open up markets, especially potential markets such as: Korea, Thailand, Malaysia and Australia. In addition, information supply programs will simultaneously be implemented to timely deliver exact market forecast and quickly identify changes in policies, mechanisms to manage import flow and quality or unfavourable news to exporting products in Vietnam in international markets so that problems can quickly be resolved. At the same time, we need to quickly establish and submit the Free Trade Agreement (FTA) Negotiating Strategy until 2020 to authorities to be ratified, gather a qualified team to negotiate FTA with important and potential markets; establish exporting development strategy for each market; encourage activities meant to promote export in the National Trade Promotion Program under the guidance of Decision 72/2010/QD/-TT. Most importantly, we need to improve the quality and competitiveness of Vietnam’s products in the international market and establish and expand distribution systems in other markets.
Furthermore, in order to provide exporting businesses opportunities to access favourable credit policies, the Ministry of Industry and Trade will work with the Finance Ministry to effectively implement a program to encourage credit guarantee for small and medium businesses as well as fine-tune import and export duties. Besides, the two Ministries continue to work in unison to ease custom formalities in the way that best helps local businesses and boosts operating and exporting activities.