Vietnam Exports to Europe: the Next Level

HO CHI MIN CITY, Vietnam - Two-way trade between Vietnam and Europe reached a turnover of US$ 9.16 billion in 2004, up by 19% over 2003. Just to give you an idea of which countries do what business with Vietnam: Germany with US$ 1,100 million, Great Britain with US$ 990 million, France with US$ 525 million, the Netherlands with US$ 560 million, Belgium with US$517 million and Italy with US$360 million. Vietnam major exported products were leather and shoes with an export turnover of US$ 1,850 million, textiles and garments with US$ 860 million, bicycles and spare parts, plus electronic components with US$ 235 million. When just looking at the growth in bicycle sales, the Vietnamese exporters managed to create a growth of 39.3% just over the first 8 months of 2004. During that period, Eurostat (EU’s custom data bureau) figures show that a total of 1,185.000 complete bicycles were imported from Vietnam into the EU-25. Average value per unit dropped 4% to € 77.18 compared to the same period in 2003. As Vietnam still has a planned economy, these are the estimates for Vietnams’ exports to Europe in 2005. Total value US$ 6.47 billion, up by 20.9%. For bicycles and spare parts, plus electronic components a growth of 29.4% is foreseen. Major target markets will be Germany, France, Great Britain, the Netherlands, Italy, Belgium, Spain and Switzerland. Basically, Vietnams exports to Europe will be facilitated thanks to common trade policies. Some products from Vietnam will be less competitive when compared with those from ‘other countries’ as they will be ruled out of the general system of preferences (GSP) from July 1st, 2005. Currently complete bicycles are in the GSP system which means that the EU import duty stands at 10.5% instead of the regular 15%.