Vietnam needs to act to stay competitive amidst rise of protectionism: PM

Vietnam needs to search for new markets, align production with market demands and tighten quality control amidst the rise of protectionism to stay competitive, said Prime Minister Nguyen Xuan Phuc.

Vietnam still faces challenges despite stellar trade turnover that reached $214 billion last year, Phuc said at a conference held by the Ministry of Industry and Trade in Hanoi on Monday. One of those challenges is the rise of protectionism in certain countries, which could potentially hamper global trade.

For Vietnam to stay competitive, three courses of action are needed, he said.

First, Vietnam needs to break into new markets to expand its export.

Second, Vietnam needs to start aligning production in accordance with market demands in order to avoid oversupply and financial losses.

“Before you produce a product, you need to know who you’re selling it to. We need to produce what other markets need, not what they already have,” said the PM.

Third, Vietnam needs to tighten quality control on its exports to meet rising standards in other countries, especially regarding agricultural products.

“Without proper quality control, we won't be able to export our products,” said the PM.

Last year, China overtook the U.S. to become Vietnam’s largest export market.

Vietnam’s exports to China surged about 15 times to $50.6 billion compared with a fourfold increase to the U.S. to $46.5 billion in the decade through 2017, according to statistics from the International Monetary Fund, as cited by Bloomberg. 

China has started boosting trade and investment in Southeast Asia while the U.S. has adopted several trade protectionist policies. The position of Vietnam’s top export market was held by the U.S. since 2002.

According to the General Statistics Office of Vietnam, the U.S. still reigns supreme as Vietnam's top export market, but exports to China are growing at a much faster rate compared to the U.S in recent years.

In the three years from 2015 to 2017, Vietnam's export turnovers to the U.S. were $33.5 billion, $38.4 billion and $41.6 billion respectively, while export turnovers to China were $16.5 billion, $21.9 billion and $35.4 billion respectively, said the office.

Vietnam's total import-export turnover reached an estimated $107.32 billion in the first quarter of this year, up 17.7 percent against the same period last year, with export value in the first three months hitting $54.31 billion, while imports registered $53.01 billion, resulting in a trade surplus of $1.3 billion, according to data from the General Statistics Office.