Vietnam mainly imported electric household appliances, fruit, automobiles, petrol and oil, plastics and car components from Thailand (Illustrative image. Source: VNA)Hanoi (VNA) – Improving the quality of domestically-producedgoods is critical for Vietnam to compete with imported products from and narrowthe trade deficit with Thailand, according to the Ministry of Industry andTrade (MoIT).
Statistics from the ministry’s Department of Asia and Africa Markets showedthat Vietnam ran a trade deficit of 3.5 billion USD with Thailand in the firsteight months of this year, a rise of 15.6 percent over the same period in 2016.Two-way trade totaled 9.64 billion USD in the period.
Vietnam mainly imported electric household appliances, fruit, automobiles,petrol and oil, plastics and car components from Thailand.
Given the increasing trade deficit with Thailand in recent years, from 3.25billion USD in 2009 to 5.16 billion USD in 2016, the MoIT was seeking measuresto improve exports to Thailand and gradually move towards a trade balance withthis country.
Le Hoang Oanh, Director of the Asia and Africa Markets Department, said that Vietnamwas working to cut tariffs following commitments to the ASEAN Trade in GoodsAgreement, according to which, many imported products from Thailand would enjoypreferential tariffs.
Currently, Vietnam has removed nearly 90 percent of tariff lines, and wouldincrease this to 98 percent by 2018.
Oanh said Vietnamese consumers now preferred made-in-Thailand products becauseof their higher quality and lower prices compared to Chinese products.
In addition, big Thai retailers, such as Central Group and TCC Group, wereexpanding in Vietnam following acquisition deals to create favourable conditionsfor the sale of made-in-Thailand products.
Thailand also regularly organised trade promotion activities in Vietnam withdozens of trade fairs held in big cities every year.
According to Bui Huy Son, Director of the Trade Promotion Agency, running a tradedeficit with a market in the integration progress is a normal thing. “It’s moreimportant to boost exports to Thailand and develop trade in a sustainable way,”Son said.
Vietnam should not focus on preventing imports but instead, improving the competitivenessof domestically-produced goods, he said, adding trade promotion activities inThailand should also be accelerated.
According to Oanh, Vietnam should boost cooperation with Thai retailers to putmore products on shelves.
In addition, Vietnam should tighten management on imported products fromThailand to ensure food hygiene and other required standards are met.
Minister of Industry and Trade Tran Tuan Anh asked relevant departments toidentify the reasons why Vietnam was running a large trade deficit withThailand, while Thai products had not penetrated widely in other ASEANcountries like they had done in Vietnam.
Disagreeing with the establishment of technical barriers to narrow the tradedeficit, Tuan Anh said that this was not a tool to prevent imports but toimprove the quality of domestic products.
“Enhancing product quality is vital in rapid integration,” he said.-VNA
VNA
