| Industry 4.0: Opportunities and challenges for the retail industry Expert Vu Vinh Phu: Need to prepare well to implement the Vietnam - Israel FTA |
The Vietnam-Israel Free Trade Agreement (VIFTA) was officially signed on July 25, 2023 and is expected by the business community to bring new opportunities for trade cooperation and boost exports in the coming time. For the retail industry, this FTA is also expected to have positive impacts and breathe new life into businesses in this industry.
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| Vietnam's retail market size is forecast to increase to 350 billion USD by 2025. |
In particular, Israel is known as an innovation powerhouse, with more than 500 retail technology startups providing solutions for a wide range of applications, from supply chain logistics to in-store consumer experiences. This is also the reason why in recent years, multinational companies such as Nike, Alibaba and Walmart have increasingly shown interest in Israeli solutions.
That is why when the FTA VIFTA was signed, Mr. Nguyen Anh Duc - Chairman of the Vietnam Retailers Association, General Director of the Ho Chi Minh City Union of Trading Cooperatives (Saigon Co.op) assessed that there would be 2 aspects that would directly impact the Vietnamese retail industry.
Firstly, in terms of technology - retail units will have a source of high-level technology from Israel. From there, it will be directly applied to the process of computerization and digitalization for Vietnam's retail services, especially in the current conditions of strong e-commerce development.
Second, Israel is a country with high-tech agriculture. This is also something we can cooperate with to facilitate retail access and introduce production technology to domestic manufacturers, thereby creating a source of goods with better quality for the market.
In fact, according to Mr. Nguyen Anh Duc, before this Agreement was signed, Israeli businesses had been exploring investment opportunities and expanding cooperation in the retail sector in Vietnam. Specifically, on May 29, an Israeli delegation led by Mr. Gal Saf - Commercial Counselor of the Embassy of Israel in Vietnam worked with the Association of Vietnamese Retailers (AVR).
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| Israeli Trade Counselor works with Vietnam Retailers Association |
At this meeting, the Israeli side highly appreciated the potential of the Vietnamese retail market and proposed that the Association connect and share market information as well as let them participate in the Vietnam Retail Forum.
“Through contact, we have seen that Israeli businesses are very proactive in seizing opportunities from the VIFTA Agreement and this is an opportunity for the Vietnamese retail industry to expand cooperation. However, to take advantage of the opportunities brought by the Agreement, we need support from relevant ministries and sectors to strengthen connections with Israeli businesses. Support here includes promoting the advantages brought by the Agreement and helping Vietnamese businesses learn about the Israeli market. Because as far as we know, this country also has a cooperative model quite similar to the model being implemented in Vietnam,” said Mr. Nguyen Anh Duc.
According to Mr. Duc, the Vietnam Retailers Association is proactively carrying out activities to connect and support businesses in this field to take advantage of opportunities brought by new-generation free trade agreements in general and VIFTA in particular. Accordingly, the Association will organize two major events including: Vietnam Retail Forum (a forum to share global and regional retail trends, types of services, technology, innovation, modern solutions for retail) and the Strategic Cooperation Forum related to cooperation in import and export of goods, processing of private label goods, etc. between Vietnam and other countries, including Israel.
| According to the Ministry of Industry and Trade, Vietnam's retail industry has a market size of 142 billion USD, forecast to increase to 350 billion USD by 2025 and continues to be one of the potential sectors. Therefore, Vietnam's retail market is increasingly attracting the participation of many domestic and foreign enterprises. |
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