HSBC claims Vietnam holds key to world trade flows

Vietnam is now a key player in the global and apparel market and in telecoms, Jasmine Lau, head of commercial banking at HSBC Vietnam, said while announcing the HSBC Trade Connection Report 2013 on March 28 in Ho Chi Minh City.

The country’s goods exports rose by an estimated 20 per cent in 2012, and China would replace the US to become Vietnam’s biggest export partner by 2030 amid buoyant intra-Asia trade, she said.

By 2030, Vietnam’s exports to Asia excluding Japan are forecast to grow by more than 15 per cent a year out to 2020, according to the report. Plans to expand the ASEAN Free Trade Agreement to zero tariffs on all goods by 2015 will be an additional factor supporting Vietnam’s trade with other economies in the region over the medium term.

Ample supplies of low-cost labour in Vietnam and Bangladesh will help drive export growth at an average 10-12 per cent, per year in the decade to 2030, concentrated in lower value-added sectors of garments, textile and wood manufactures.

Emerging economies, including Vietnam, will produce higher value-added goods and trading hubs will hold the keys to regional flows amid intensifying south-south trade, according to HSBC.

Vietnam will also be an increasingly large importer, both capital goods to meet its large infrastructure needs and of consumer goods to meet the needs of its rapidly expanding consumer market, the report said. India, China, Turkey and Bangladesh will be Vietnam’s fastest growing import partners in the decade to 2030.

The forecast said Vietnam was also developing a strong communications sector which will contribute nearly 10 per cent of its export growth to 2030.

“The report shows how trade trends in the world are changing. It also shows opportunities for companies to continue to grow,” said Lau.