Vietnam and UAE act to double bilateral trade

October 26, 2019 | 09:52

(0) user say

Vietnam and the United Arab Emirates are aiming to double bilateral trade turnover to $10 billion in the next three to five years.

vietnam and uae act to double bilateral trade

At the Vietnam-UAE Business Forum, both countries strengthened their mutual co-operation

The Vietnam-UAE Business Forum was held in Hanoi and Ho Chi Minh City to mark the October 14-16 visit to Vietnam by the UAE minister of Economy, heralding an important milestone in trade relations between both countries and confirming the direction of both governments in evaluating current economic and trade relations and promoting activities to strengthen this relationship in the near future.

Speaking to VIR on the sidelines of the event in Ho Chi Minh City, Abdulla Al Saleh, Undersecretary of the UAE Ministry of Economy, said that given the existing potential of the two countries, with the speed of economic development and Vietnam signing bilateral and multilateral economic agreements, this trade goal may be achieved.

“The UAE considers Vietnam an attractive market for its investments due to its strong economic efficiency and high growth rates. Currently, Emirati investments in Vietnam still focus on logistics, port management, aviation, and tourism and hospitality, in addition to oil and gas,” said Saleh.

According to Vietnamese Minister of Industry and Trade Tran Tuan Anh, Vietnam is particularly impressed with the UAE’s development in the fields of renewable energy and energy saving. The country is currently one of the world leaders in developing clean energy, renewable energy, solar power, and wind power, with the world’s largest solar power plant (Shams 1) and a solar energy park in Dubai.

“The Emirates can participate in clean energy investment, one of the areas which the Vietnamese government is prioritising in its plan for sustainable development in the years to come,” Anh said.

According to him, although there have been positive results, the potential for co-operation between the two countries is still great, especially in the fields of trade, investment, energy (oil, gas, and renewable energy), infrastructure development, labour, tourism, material production, processing of agricultural products, foodstuffs, and construction of industrial parks in a number of potential economic regions in Vietnam such as the Central Highlands, south central, and south west.

“Vietnam’s government will create favourable conditions to encourage UAE businesses to invest in Vietnam and also expect the UAE to continue facilitating Vietnamese businesses and goods to the Middle East and other markets, creating conditions for Vietnamese workers to have more opportunities to find jobs and have a stable and developed life in the Emirates,” said Anh.

Official diplomatic relations between the two nations were established in 1993. According to data from Vietnam’s Ministry of Industry and Trade, the UAE is now one of Vietnam’s leading trading partners in the Middle East with over 60 product groups, and is its 10th-largest global export market.

Vietnam’s main exports to the UAE include mobile phones, computers and components, electrical products, consumer electronics, pepper, seafood, footwear, textiles, fabrics, pearls, gemstones, cashews, rice, tea, cereal products, plastic products, wooden furniture, paper, fruits, vegetables, and cigarettes.

The key products that Vietnam needs to import from the UAE are gas, plastic materials, animal feed materials, and many other consumer goods.

In 2018, the total two-way trade turnover hit $5.67 billion, up 1.3 per cent on-year. Of this, Vietnam’s exports to the UAE amounted to $5.2 billion, up 3.5 per cent on-year.

In the first nine months of 2019, the import-export turnover between the two countries reached $4.26 billion, an on-year slight drop.

Dinh Duc Thang - CEO, OPEC Plastics

With 15 years of experience in the plastics industry and as a partner of the world’s leading corporations, OPEC Plastics recognises that the Middle East region in general and the UAE in particular are abundant sources of plastic resins, while the region is one of the largest oilfields in the world.

Although a number of plastic resins from the Emirates are sold at a higher price than those imported from South Korea or Thailand, they are often favoured by big companies. This is partly because the companies will be refunded the import tax of the materials if they use this material to manufacture products for export. The amount of plastic resins imported from the Middle East and UAE region accounts for 60 per cent of the import volume of OPEC Plastics every year, and the company has had the opportunity to co-operate with many large corporations.

Despite being an abundant source of materials, the trade war and political instability are disadvantages of this region. For example, Aramco’s factory was recently bombed, affecting OPEC Plastics’ supply.

Ali Mohamed - Growth team Mubadala Petroleum

Our company is investing in upstream oil and gas in offshore. With the nation’s stable economic development in recent years, I am sure that our business in Vietnam will be fruitful.

Mubadala Petroleum wants to solidify its co-operation with state-run PetroVietnam to expand its business and increase investment in other spheres like renewable energy. Mubadala Petroleum has been active in Vietnam since 2007 and has non-operated interests in offshore.

We have seen many opportunities for oil and gas collaboration between the UAE and Vietnam.

In particular, PetroVietnam, the flagship of Vietnam’s oil and gas industry, is an outstanding, professional group that we are happy to work with.

In the future, I believe our two nations can work together to expand our operations to the downstream field, and increase the quality of oil and gas.

Jamal Saif Al Jarwan - Secretary general, UAE International Investors Council

As our council works in partnership with Emirati companies to invest worldwide, we have seen the huge potential for business between the UAE and Vietnam, a potential which is yet to be exhausted. We have discussed at length with the Vietnamese government and businesses the prospects of investing in such diverse fields as tourism, real estate, and infrastructure, which represent our investors’ priorities right now. We are taking this opportunity to promote trade between the two countries very seriously.

Achieving the target of doubling our trade volume to $10 billion in the next five years will require promoting trade, information exchange, and more business trips. In fact, it is high time for companies in the UAE to look deeper into the Vietnamese market.

Nadya Karrmali - CEO, Customs World

Owning a world logistic passport (WLP), launched by the Customs World, will make it easier for Vietnamese enterprises to access the Dubai Silk Road and contribute to reducing the distance between Vietnam and other world economies.

With this passport, businesses will be able to use interconnected services to cut storage time to 48 hours, simultaneously decreasing costs. For example, goods exported from Vietnam to the UAE are often transited at Frankfurt, incurring high costs and wasting time.

However, if these goods are transferred at Dubai thanks to the passport, enterprises can save two hours and $1,000. This is because the goods will be cleared before arriving at the port and transit activities are automatic and free.

The Customs World will work with the authorities, including the Vietnam Logistics Business Association, to popularise the WLP in ports and airports in Vietnam.

By Bich Ngoc

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional