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Sep 23, 2019 / 05:03

Middle East-African Ambassadors: Huge potential cooperation with Vietnam

South Africa, with a population of over 56 million, is Africa’s most developed economy and already an important market for Vietnamese enterprises.

Many Middle East-African ambassadors share the huge potential with the optimism about cooperation between Vietnam and Middle East- African countries in the coming time.
A protential FTA
Israeli Ambassador to Vietnam Nadav Eshcar said that Israel is a market with great potential for Vietnam. Currently, Israel imports nearly US$1 billion per year from Vietnam with major commodities such as technologies, garments, footwear, and agricultural products like coffee, fish, seafood, spices, and rice. Vietnam is one of Israel’s most important seafood suppliers.

Israel’s Ambassador to Vietnam Nadav Eshcar speaks with Chairman of the Hanoi People's Committee Nguyen Duc Chung
Israel’s Ambassador to Vietnam Nadav Eshcar speaks with Chairman of the Hanoi People's Committee Nguyen Duc Chung
In particular, according to the ambassador, the two sides are negotiating a free trade agreement (FTA) and have taken many important steps forward. Hopefully, this FTA will be completed in early 2020. At that time, the Israeli market will be more open to Vietnamese enterprises.
The FTA will be meaningful for Vietnam’s agricultural products because many Israeli products are not yet imported from Vietnam, specifically fruits (pomelo, pineapple, and mango). With a completed FTA, those issues will be resolved. According to the ambassador, one year after each FTA is signed, trade turnover between the two signatory partners will immediately increase by 50%. The ambassador said that the Israel – Vietnam FTA will not be an exception and this will be the key for the two countries’ trade.
“It can be said that the quality of some Vietnam’s products is very high. Talking about tropical fruits, we also grow mango and pineapple, but in small quantities and lower quality in comparison with Vietnam’s. Therefore, I want my Israeli fellows to to enjoy Vietnamese foods as I am enjoying them here”, the ambassador said.
On the Israeli side, the ambassador said that the current focus of the Embassy is to organize trade promotion events with an aim to introduce Israel products, mainly in the field of technology, to Vietnam. Technology products are Israel’s main export to Vietnam.
According to the ambassador, when Vietnam’s industries develop to a higher level, export will be facilitated as well. For example, Israel has a very high dairy production technology. Buying this technology, Vietnam can increase milk output of each cow from 15kg/day to 25kg/day. As a result, Vietnamese companies will be more successful, not only in the homeland but also in foreign countries.
Access to a 1.2-billion-people market
Regarding South Africa market, South Africa's Ambassador to Vietnam Mpetjane Kgaogelo Lekgoro shared that trade between the two countries is sound with significant potential that still remains to be tapped.
Following the impact of the 2008 Global Financial Crisis, which also impacted negatively on South Africa - Vietnam trade relations, total bilateral trade has steadily improved from US$716 million in 2012 to US$1.5 billion in 2016, before slowing to US$1.04 billion in 2018, with a healthy trade balance in Vietnam’s favour.

Morocccan Ambassador to Vietnam Jamale Chouaibi.
Morocccan Ambassador to Vietnam Jamale Chouaibi.
South Africa, with a population of over 56 million, is Africa’s most developed economy and already an important market for Vietnamese enterprises, but with huge untapped potetial. It is home to an abundance of resources, well-developed financial, legal, communications and transport sectors, a stock exchange that ranks among the top twenty in the world and modern infrastructure supporting an efficient distribution of goods to major urban centres throughout the southern African region.
During the 12th Extraordinary Summit of the African Union (AU) held in July 2019, the African Continental Free Trade Area (AfCFTA) was officially launched into its implementation phase, after 54 African countries signed the agreement and 27 countries ratified it.
Trading under the terms of the AfCFTA is intended to come into effect on July 1, 2020. Africa will become the world‘s biggest Free Trade Area, connecting 1.2 billion people into a single bloc where products will be manufactured, bought and sold between countries, without any trade tariffs. “This means if a company in Vietnam does business with a South African counterpart, that company can have an opportunity of tapping into this big market”, the ambassador emphasized.
With regard to the potential for South African businesses in the Vietnamese market, Vietnam is one of the fastest growing economies in Southeast Asia. As the demands for goods and services expand, South African businesses could look into Vietnam for joint ventures in construction, financial services, and food chains sectors.
Supporting the SMEs
In the Moroccan market, Moroccan Ambassador to Vietnam Jamale Chouaibi emphasized that Morocco and Vietnam have enormous potential to spur trade, thanks to the positive evolution of their bilateral relations over the past years, especially after the successful visits to Vietnam by the Secretary of State Ms Mounia Boucetta in April 2018, and by the President of the House of Representatives M. Habib El Malki in December 2017, as well as the visits to Morocco of high-level Vietnamese officials, including the Chairperson of the National Assembly of Vietnam Nguyen Thi Kim Ngan in March 2019, and Secretary of the CPV Vo Van Thuong in June 2019.
The geopolitical similarities between Morocco and Vietnam, respectively as entry gates to Africa and Europe and to South-East Asia, the new dynamic enjoyed by their emerging economies, their sustained economic growth and their policies of diversification of trade partners and of human resources capacity strengthening are all factors allowing for further cooperation and coordination in the future.
In order to meet the aspirations of the two countries at more trade and economic partnerships, the ambassador said that there is a need to adopt a new approach favoring direct interaction between the Vietnamese and Moroccan economic stakeholders. The establishment of a Morocco-Vietnam business council would contribute to spur trade and economic exchange between the two countries.
A trade agreement was signed recently between the Ministry of Industry and Trade of Vietnam and the Ministry of Industry, Investment, Trade and Digital Economy of Morocco in order to promote cooperation in numerous fields of shared interest, mainly renewable energy, textile, clothing, electronic and mechanical industries, chemical industry and fertilizers production.
Another MOU between the two ministries in charge of commerce was also signed recently, establishing a sub-committee on trade and industrial cooperation with the mission of promoting bilateral trade and supporting the SMEs through the implementation of measures identified to this end. The organization of Business Fora and the promotion of tourism and cultural exchanges should favor more mutual understanding as well as a growth and diversification of bilateral trade.