Rising demand in the United States, fueled by its recovering economy, is offering more opportunities for Vietnamese firms to step up sales there this year, according to experts.
Rising demand in the United States, fueled by its recovering economy, is offering more opportunities for Vietnamese firms to step up sales there this year, according to experts.
Giovanni Rojas, director of sourcing services at Target Group, told a conference on trade and investment chances in the U.S in Dong Nai Province that the company is expected to increase imports from Vietnam this year.
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| Giovanni Rojas of Target stops at a farm produce booth on the sidelines of the conference in Dong Nai. |
The U.S. retail giant, which now has more than 1,800 stores stateside, imported US$800 million worth of goods from Vietnam last year, with most of them apparel, footwear, furniture, toys, photo frames and stationery.
The Vietnamese trade counselor in the U.S., Dao Tran Nhan, said the U.S. is a major importer of many Vietnamese products. It imported US$9.8 billion worth of garments, US$3.3 billion of footwear, US$2.2 billion of furniture, US$1.7 billion of seafood, US$1 billion of bags, suitcases and hats, US$636 million of cashew nuts, and US$255 million of pepper from Vietnam last year.
Nhan said the U.S. economy grew 3.2% last year and is projected to expand 3.7% this year. A recovery of the economy will prop up consumer spending and this is a good chance for Vietnamese companies to boost exports to the U.S.
Negotiations over the Trans-Pacific Partnership (TPP) agreement are expected to be concluded some time this year. This multilateral trade pact will contribute to fueling Vietnam’s economic growth and exports.
However, Nhan pointed out limited production capacities, slow goods delivery and poor competitiveness as the weaknesses of Vietnamese companies. On top of that, local exporters have to meet high criteria for food safety and face technical barriers in the U.S.
Nhan called for local enterprises to sell their products to the U.S. market via retailers and importers such as Walmart, Kroger, Target, Tyson Foods, Sysco and US Foods.
However, Rojas of Target said in addition to food safety, Vietnamese firms should meet multiple requirements for product quality, packaging, environment, labor safety and anti-bribery before they can partner with Target.
Rojas said suppliers from Vietnam should provide transparent and verifiable information about their factories, social welfare, and impacts on the environment, especially for the companies in the dyeing and garment sector.
Thomas Jandle of TJMR Asia Consultant suggested Vietnamese firms rely on local supplies to turn out their export products, instead of imports from the countries which are non-TPP members.
Nguyen Phu Cuong, vice chairman of Dong Nai Province, said the southern province earned US$3.6 billion from exporting apparel, footwear, wooden products, steel products, machines and equipment, cashew nuts and coffee to the U.S. last year, up 14.7% year-on-year.
Cuong acknowledged that the province has shipped goods to the U.S. via intermediaries and has not diversified importers due to the limited capacities of local enterprises.
Cuong added leaders of Dong Nai Province traveled to the U.S. last November to explore trade opportunities and find investors for infrastructure development projects.
Speaking at the conference, Chris Neeley, executive vice president at Made in USA Works, said the company can support Vietnamese firms to find funding and develop products in the U.S. At the conference, representatives of Made in USA Works and business associations in Dong Nai Province inked cooperation agreements.
According to the General Department of Customs, two-way trade between Vietnam and the U.S. last year neared US$35 billion, accounting for 11.7% of Vietnam’s total foreign trade.
Vietnam’s exports to the U.S. stood at US$28.6 billion in 2014, with key products including textiles and garments, footwear, furniture, seafood, handbags and hats, with apparel making up half of Vietnam’s apparel exports.
(Source: SGT)
