Which products Argentine companies plan to export to and import from Vietnam?
In general terms, trade between both countries is complementary and the bilateral relationship is very close and sound. Both governments have reached a good level of dialogue.
The sanitary authorities of Argentina
and Vietnam are working close together (getting to know how the products are produced in each country, doing the respective analysis to issue certifications and facilitate trade) so that we can import more products from Vietnam.
From the start, there is a characteristic that favors both countries: their export profiles are not competitive but complementary. Because of their natural conditions, resources, geographic location and main products exported, Vietnam and Argentina have different products to offer to each other.
Just taking fruits as an example, Argentina produces certain fruits that Vietnam does not such as citrus (oranges, lemons, tangerines, grapefruit), all kinds of berries and stone fruit. Meanwhile, Vietnam has tropical fruits that Argentina does not produce. In this sense, Argentina is keen on importing fruits such as dragon fruit, litchi, longan and mango. At the same time, Argentina wants to export its apples, pears, citrus and berries.
Regarding food, in 2014, Vietnam and Argentina reached an agreement that allowed, amongst others, the exports of Argentine animal and plant-origin products for human consumption to Vietnam. Since then, the registration and authorization of exporting establishments from both countries has risen enormously. Vietnam is strongly interested in exporting fish to Argentina and now is allowed to do so.
As Argentina is famous for its beef, what plans do Argentine firms have to export this product to Vietnam? Which volume is expected?
Amongst the products that Argentine companies are permitted to export to Vietnam, beef is one of them. There is a list of Argentine companies that have been allowed by Vietnam's National Agro-Forestry-Fisheries Quality Assurance Department (Nafiqad) to export to Vietnam.
As a governmental agency, our role is to help facilitate trade and open markets. Argentine and Vietnamese firms will decide which kind of beef they are going to import, if cheap cuts for daily dishes like Pho, or high-end beef for hotels and restaurants.
Argentina’s beef characteristics are different from other countries thanks to the way the cows are raised. We believe that there is a market niche for Argentine beef as it has less fat, more flavor, and competitive prices.
The size of the market in Vietnam is growing and the taste of local consumers is getting more sophisticated. Vietnamese importers are interested in including Argentine beef in their portfolio, apart from U.S., Australian and New Zealand varieties, and now have the chance to do it, so we expect to see more Argentine beef in Vietnam.
Argentina’s National Institution for the Promotion of Beef is in charge of promoting beef exports, training domestic producers how to improve the quality of beef and taking them to international fairs, among other activities.
Both, members of the Institution and Argentine businessmen, have come to Vietnam to explore business opportunities in the Vietnamese market.
In November 2015, the Embassy of Argentina in Vietnam held the second “Argentine Night in Hanoi”, where Vietnamese importers and Argentine partners talked and traded ideas.
Trade between Vietnam and Argentina has been on the rise. Which is the target for the coming years?
Trade between Vietnam and Argentina has seen a very promising jump.
Looking back to the beginning of this decade, bilateral trade was only $36 million. In the first 11 months of 2015, the turnover of bilateral trade reached $2.33 billion, rising 37.1% year-on-year, according to the General Department of Vietnam Customs.
Looking into the composition of Vietnamese exports to Argentina, we see that the products are value-added. Vietnam ships shoes, garments, rubber, electronics, household appliances, etc.
Argentina mainly sells animal feed, which accounts for some 80% of Argentine exports to Vietnam. In this sense, our country would like to diversify the products that are traded, by shipping more fruits, wines, beef, pharmaceuticals, leather and dairy products.
As Vietnam and two other Latin American countries namely Chile and Peru are parties to the Trans-Pacific Partnership (TPP) agreement. What threats could the deal pose to Argentine exports to Vietnam?
We need to be very competitive in certain sectors in order to have the chance to export to Vietnam, especially after Vietnam has signed many FTAs like the TPP, the ASEAN Economic Community (AEC) and others. As Argentina is not part of these treaties, it will be very challenging for Argentine exporters to compete with other international providers. Thus we will have to compete in terms of quality.
Vietnam has been very active in these economic negotiations, so it is very interesting to see how the country will seize the opportunities as well as overcome the challenges that those treaties pose.
Could you highlight other results of the economic cooperation between Vietnam and Argentina in recent years?
Our role as an embassy is to help connect the two governments and the two peoples. In terms of economic cooperation, we have reached agreements that facilitate trade.
As Vietnam and Argentina do not have an FTA in common, the two sanitary authorities work close together in order to agree on a list of products that both countries can sell to each other and remove barriers to bilateral trade.
There is very good political will between the two governments and there are no technical barriers to two-way trade.
We do South-South and technical cooperation. We share knowledge. Argentina has many agricultural cooperation projects in Vietnam, particularly in dealing with foot-and-mouth disease (aphthous fever), enhancing resistance of rice and soya, reducing post-harvest losses, and providing the ‘silo bag’ technology, which helps store grains on-site.
Another major aspect is that Argentina has helped Vietnam identify war martyrs. The Argentine Institute of Forensic Medicine has trained Vietnamese experts in DNA analysis to identify war martyrs’ remains.
In addition, Argentina has supported Vietnam in economic negotiations. Argentina’s Ministry of Foreign Affairs has provided technical assistance to the Vietnamese side.
In which Vietnamese industries are Argentine enterprises interested to invest in?
We have detected that Argentine enterprises are mostly interested in investing in the local pharmaceutical area (producing medicines for humans and for animals) as well as in green energy, especially windmill power. However, for the time being there are no concrete projects being run in these fields.
The Communist Party of Vietnam has attached great importance to the private sector. What further actions does Vietnam need to take to stimulate this sector? Could you share some experience of Argentina regarding this aspect?
Argentina has gone through administrations that have advocated both, for state-owned companies as well as all private.
According to our last experience, there must be a good balance between healthy private-run companies and strong state-controlled ones.
As Vietnam is speeding up the equitization process of state-owned enterprises, the private sector will be freer. The role of government, controlling and regulating this process, is key since it is the guarantor of the wellbeing of the people.
I see Vietnam changing. It is opening little by little to have a bigger private sector. It has the chance to do this gradually and not drastically.
Thank you very much!