Chile and Vietnam to discuss bolstering trade co-operation

Vice Minister of Trade for Chile Rodrigo Yañez (left) and Vice Minister of Industry and Trade Do Thang Hai (right)

During your first visit to the country, what topics do you intend to touch on and what are your expectations?

This is the first visit I pay to Vietnam to meet and discuss with my counterparts – the Vice Minister of Industry and Trade and the Ministry of Foreign Affairs – the 2020 agenda between Chile and Vietnam. There are many different issues that merit our mutual attention, in many aspects of trade and co-operation.

First, trade and our free trade agreement (FTA) which, since 2014, have taken bilateral trade to nearly $1 billion and makes today Vietnam our 23^rd trading partner. I believe, it is in both sides' interest to modernise our FTA to include new disciplines and to push out our boundaries in bilateral trade.

Also, services and investment co-operation holds tremendous potential to scale up between Chile and Vietnam. Additionally, while our trade figures have grown steadily over time, I believe they are far from our true potential. We are here to talk about trade and to see if we can schedule the fourth FTA commission between Chile and Vietnam this year here in Hanoi. Additionally, we would like to call attention that this year will be one of heightened activity, where we bring trade delegations and missions to Vietnam and collaborate with Vietnam as ASEAN Chair.

Chile is the chair of the Pacific Alliance, and we believe this puts our two countries in a unique position to discuss and foster co-operation to an unprecedented degree. We are also both signatories to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which adds further dimensions to trade and investment co-operation. This is also something that we expect to discuss with Vice Minister of Industry and Trade Dang Hoang An and the Vietnamese Ministry of Foreign Affairs.

How do you evaluate Chile-Vietnam trade and investment relations in recent years?

Trade has been expanding, although Chilean exports to Vietnam are still not as large as we expected. Today, Vietnamese exports to Chile have reached $750 million, while Chilean exports to Vietnam value at only some $240 million. Most notably, Chile and Vietnam have yet to have any investment in each other, and we believe this a matter worth addressing and that the CPTPP would be an important instrument for that.

It has been, I would say, a success story for trade between our nations, but I think there are many pending tasks that need the two countries to work together to deal with.

How do you expect to enhance economic co-operation with Vietnam and other Asian countries?

Vietnam is an important player in the ASEAN. It has positioned itself as a hub for this region and the rest of Asia which has great appeal for Chilean investors who believe they can expand to other markets in this region from Vietnam. I think we should further explore these potentials – and it is worth to look at the opposite way around, too, discovering Chile as a hub for Vietnam in Latin America. We have the largest FTA network in the world, and we both stand to benefit from working together on a bilateral basis to shape our standing in global value chains.

The ASEAN, as a geographical region, is one of the key priorities in our trade policy. That is why I am visiting Vietnam, Singapore, Indonesia, Malaysia, and other regional partners. We are very active across the ASEAN and are working to expand and diversify our exports to the world, in which the ASEAN plays a key role.

What are your recommendations to improve trade between the two countries?

To solve the difficulties and the pending issues that block our trade flows, there needs to be commitment to advance a shared agenda, and that is why we are here to express, at a very early stage, our interests and support to Vietnam as the Chair of ASEAN.

We are living in a world with a lot of uncertainties in trade and the economy. Countries like ours, which are extremely open to the world, need to join together and work for clear rules based on international order. To further align under the WTO, APEC, ASEAN, the Pacific Alliance, and other regional and global trade alliances, countries like ours need to stick together and act together for clear and predictable rules in doing business.

What are the spearhead trading sectors between Vietnam and Chile, and in which ways can we develop better two-way trade co-operation?

Vietnam is one of the biggest technological supplies exporters to Chile. Cell phones are a very important input from Vietnam, along with textile and fisheries products. In return, Chilean exports are dominated by agricultural, livestock, and forestry products, and wines are also growing in this market.

It is a matter of how we can jointly develop value chains. We should start much deeper projects between the two countries to see what chains we can supply together and which chains have to do with the Latin American region. It is also something that I am here to discuss with my counterparts, to see if we can help expand Vietnamese imports. Today, we have an FTA that provides preferential access to Vietnam. Vietnamese exports in Chile have a very competitive position and Vietnam has become a very important supplier for the variety of goods that I mentioned, but I think we need to work further on what supply or value chains we can supply together.