VN-Chile FTA set to boost Latin America exports
VN-Chile FTA set to boost Latin America exports
The free trade agreement (FTA) between Viet Nam and Chile, which comes into effect on January 1, will open markets to Vietnamese exports in Chile and much of Latin America.
The FTA will allow many Vietnamese products, including footwear, fine arts and handicrafts, fertiliser, furniture and household utensils, to enjoy zero import tariffs in the Chilean market, said Vietnamese trade counsellor to Chile Tran Dinh Van.
The tax cut would also help sharpen the competitiveness of Vietnamese goods, compared to other Asian countries of similar strength, Van said.
He added that Chile and other Latin American countries were not as demanding as Japan and the EU, so Vietnamese products would find it easier to penetrate these markets.
Since 2010, Vietnamese exports to Chile have grown by more than 20 per cent annually, estimated at US$250 million by the year-end.
However, both countries' managerial agencies said that their trade performance hasn't matched its potential. Director of the American Market Department under the Ministry of Industry and Trade (MIT) Nguyen Duy Khien noted that Chilean businesses prefer to do business with partners from countries having FTA's with Chile. Therefore, trade with Vietnamese businesses has not been promoted in the past.
In order to take advantage of Chile as well as other markets in the region, domestic businesses should carefully consider factors, including their geographical locations, in order to reduce costs. They also suggested that domestic businesses contact Vietnamese trade offices in Latin America to receive support for their promotion plans.
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