Ample room to boost Việt Nam-Singapore trade

Ample room to boost Việt Nam-Singapore trade

Việt Nam and Singapore have significant potential to expand their trade relationship, with numerous untapped opportunities, experts said at a seminar in HCM City on Thursday.

Hồ Thị Quyên, deputy director of the Investment and Trade Promotion Centre of HCM City, speaks at the seminar "Promoting Exports to the Singaporean Market" held in HCM City on March 13. — Photo courtesy of ITPC

Speaking at the seminar "Promoting Exports to the Singaporean Market," hosted by the Investment and Trade Promotion Centre of HCM City (ITPC) and the Vietnam Trade Office in Singapore, Hồ Thị Quyên, ITPC’s deputy director, highlighted the strong strategic partnership between the two nations over the past decade. Economic, trade, and investment cooperation remain key pillars of their bilateral relations.

In 2024, trade between Việt Nam and Singapore reached US$10.5 billion, with Việt Nam’s exports to Singapore accounting for nearly $5.2 billion, while its imports from Singapore exceeding $5.3 billion. Singapore is now Việt Nam’s fourth-largest trading partner within ASEAN, following Thailand, Indonesia, and Malaysia, Quyên said.

She emphasised that the economies of Việt Nam and Singapore complement each other well, with both countries being members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP). This shared membership presents a valuable opportunity for businesses from both nations to strengthen cooperation for mutual development.

At the local level, Quyên noted that HCM City serves as Việt Nam’s major economic, financial, and commercial hub, contributing approximately 22 per cent to the national GDP and 27 per cent of the state budget. The city is committed to rapid and robust economic growth and aims to become a leading smart city and digital economy hub in Southeast Asia by 2030. Its goals align closely with Singapore’s, which is currently the largest foreign investor in HCM City.

A global gateway for Vietnamese goods

Cao Xuân Thắng, head of the Vietnam Trade Office in Singapore, emphasised Singapore’s outsized role in global trade despite its small size. With a population of just over six million, Singapore is home to more than 427,000 millionaires and serves as a key hub for trade, investment, and connectivity in the region.

Each year, Singapore imports goods worth between SG$400-500 billion (US$299-274 billion), with 60 per cent of these products being re-exported to third countries. This means Vietnamese businesses exporting to Singapore are effectively gaining access to the global market.

Yet, Việt Nam’s exports to Singapore remain relatively modest at just SG$8-9 billion (US$6-6.7 billion) per year. This indicates a significant opportunity for Vietnamese exporters, particularly in key sectors like industrial products, seafood, and rice.

Thắng noted that while Vietnamese rice is highly regarded for its quality, it remains costly. Additionally, much of it is sold under Singaporean brands due to limited investment in large-scale trade promotions by Vietnamese firms.

Similarly, Vietnamese seafood is well-received in Singapore and caters to its diverse ethnic communities. To expand market share, Vietnamese exporters should prioritise obtaining Halal certification, invest in high-quality packaging, and provide detailed product information, he advised.

Singapore is a highly demanding market with strict quality requirements and intense price competition. Imported food products are sampled and quality-checked before distribution. Given Singapore’s small population, high ethnic diversity, and role as a global trade hub, it often serves as a testing ground for new products and services, he said.

“Vietnamese businesses can seize export opportunities by meeting Singapore’s standards, actively participating in trade promotion programmes, engaging with potential partners and buyers, and leveraging e-commerce channels to boost brand recognition,” he added.

Wesley Chua from the Singapore Chamber of Commerce in Việt Nam suggested an alternative approach: instead of solely focusing on exports, Vietnamese enterprises should consider investing in Singapore as a gateway to third-country markets.

Singapore has become a preferred destination for international businesses to establish headquarters, thanks to its advanced infrastructure, abundant financial resources, clear tax policies, and low-risk environment. It also provides seamless access to global markets through its extensive free trade agreements.

Vietnamese enterprises can leverage Singapore’s advantages to optimise export efficiency. Manufacturing or setting up operations in Singapore grants businesses credibility and easier access to international customers, a potentially game-changing strategy for firms looking to scale globally, he said.

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