Expectations open up new opportunities

Minister of Industry and Trade Nguyen Hong Dien works with Russian Federation Energy Minister Nikolai Shulginov

Since establishing diplomatic relations in 1950, Vietnam and the Russian Federation have developed strongly in most areas and established a Comprehensive Strategic Partnership in 2012. Moreover, since the Free Trade Agreement between Vietnam and the Eurasian Economic Union (EAEU) took effect, the growth in trade turnover between Vietnam and Russia has made strong progress and created favorable conditions for businesses of both sides to strengthen economic, trade and investment cooperation.

Therefore, the upcoming official visit to Vietnam by Russian President Vladimir Vladimirovich Putin is expected to open up new opportunities in bilateral relations, towards prosperous development.

Trusted partner

Experts say that after signing the EAEU-FTA, trade turnover between Vietnam and Russia increased rapidly, reaching 5.5 billion USD in 2021, up nearly 90% compared to 2016; of which, Vietnam's exports to Russia reached 3.2 billion USD, up 100% compared to 2016. However, after the Russia-Ukraine conflict (February 2022), the unfavorable geopolitical-economic situation has negatively impacted Vietnam-Russia bilateral trade. Vietnam's export turnover to Russia in 2022 decreased by over 51% compared to before.

Therefore, the Trade Office of the Vietnamese Embassy in Russia has actively worked with industry associations to update information on the market situation and discuss measures to remove difficulties for businesses. At the same time, it has coordinated to organize many online meetings to connect business cooperation between Vietnamese and Russian enterprises in the fields of seafood, agricultural products, etc.

In addition, the Trade Office also regularly exchanges and directly consults businesses on the market situation and cooperation with Russian businesses; supports in removing obstacles, difficulties and disputes in the implementation of contracts between businesses of the two countries; consults and supports Vietnamese businesses to participate in exhibitions in Russia.

The leader of the European-American Market Department (Ministry of Industry and Trade) said: Although still affected by geopolitical fluctuations, trade in goods between Vietnam and Russia in 2023 has had positive changes.

Import-export turnover between the two sides reached 3.63 billion USD, a slight increase of 2.3% over the same period in 2022; of which, Vietnam's exports to Russia reached 1.74 billion USD, an increase of 12%. Vietnam's imports from this market reached 1.89 billion USD, a decrease of 5.2%.

In the first 5 months of 2024 alone, the import-export turnover of goods between the two sides reached 1.96 billion USD, an increase of 51.4% over the same period in 2023; of which, Vietnam's exports to Russia reached 955.6 million USD, an increase of 44.7%. Imports from Russia to Vietnam reached 1 billion USD, an increase of 58.4% over the same period in 2023.

According to the leader of the European-American Market Department, export commodity groups from Vietnam to Russia with high growth include seafood reaching 76.4 million USD, up 87.8% over the same period in 2023; cashew nuts reaching 28 million USD, up 82.4%; pepper reaching 12.5 million USD, up 96.2%; textiles reaching 320.8 million USD, up 97.1%; machinery, equipment, tools and other spare parts reaching 90.1 million USD, up 102%.

On the other hand, Vietnam's imports from Russia increased sharply, including ores and minerals of all kinds reaching 9.7 million USD, coal of all kinds, chemicals, fertilizers of all kinds, other base metals, components and auto parts...

Recently, within the framework of the 33rd Vietnam International Trade Fair (Vietnam Expo 2024), Mr. Viacheslav Kharinov, Chief Representative of the Russian Trade Agency in Vietnam expressed his joy and emphasized that this is an opportunity for businesses of both sides to learn about each other's information, thereby opening up great opportunities for both sides.

In the first five months of 2024, Vietnam's exports to Russia reached 955.6 million USD, up 44.7%. (Illustration photo: Hoang Nhi/VNA) — In the first 5 months of 2024, Vietnam's exports to Russia reached 955.6 million USD, up 44.7%

According to Mr. Vitaly Stepanov, CEO of Moscow Export Center, Moscow is the leading locality in exporting goods compared to all regions of Russia. Vietnam is an important market for Moscow and Moscow Export Center has implemented a series of measures to strengthen business relations with Vietnam.

"With the support of the Moscow Export Center, more than 100 businesses have participated in negotiations with partners from Vietnam. In particular, the opening of the "Made in Moscow" booth at Vietnam Expo marks a new milestone in promoting Russian and Vietnamese business relations," Mr. Vitaly Stepanov emphasized.

Mr. Do Van Phuong, Director of Vietfood DV Company - the official agent for Trung Nguyen coffee brand in Russia, said: Trung Nguyen is the coffee brand with the largest consumption in Russia with 3 main markets: Vladivostok, Novosibirsk and Moscow. In 2023, the company imported about 700 tons of various types of Trung Nguyen coffee for consumption in this market.

Meanwhile, Ms. Pham Van Anh, Director of Foodzone Company, said that over the past 6 years, the company has brought soft drinks, sauces, vermicelli, pho, and rice vermicelli produced in Vietnam, then packaged and labeled Foodzi for consumption in the Russian market. In particular, when Vietnamese food is chosen as part of the Russian lifestyle, there will be great development opportunities for Vietnamese businesses.

Tighten the relationship

The Vietnamese Trade Counselor in Russia said that in recent times, the Trade Office has connected many Vietnamese enterprises to export agricultural products to suppliers in supermarket chains here. However, to export sustainably to the Russian market, Vietnamese enterprises need to have a strategy and build a supply system in the host country to supply the supermarket chain. Moreover, enterprises need to proactively participate in specialized exhibitions and fairs to learn about the market and find business partners.

In order to fully utilize the incentives of the VN-EAEU FTA and continue to maintain the growth rate of bilateral trade, the Vietnam Trade Office in Russia recommends that businesses of both sides, especially Vietnamese businesses, increase trade promotion. The representative office in Russia is always ready to coordinate, advise and support business cooperation and investment connections for businesses of both sides.

At the working session between Minister of Industry and Trade Nguyen Hong Dien and Russian Minister of Energy Nikolai Gregorievich Shulginov, the two sides reviewed the implementation of bilateral oil and gas and energy projects as well as agreed on major cooperation directions that the two sides will study and implement in the coming time.

At the same time, the two ministers signed the Protocols amending the Intergovernmental Agreement on the operation of the two joint ventures Vietsovpetro and Rusvietpetro. The signing of these two documents demonstrates the strong support of the leaders of the State and Government of the two countries for the policy of prioritizing the development of the energy and oil and gas sectors in bilateral cooperation, thereby strengthening bilateral cooperation.

Notably, on the sidelines of the Russian Energy Week forum, the Minister of Industry and Trade worked with major Russian oil and gas companies such as Zarubezhneft, Gazprom and Novatek. The parties discussed the implementation of their projects to promote cooperation between the two countries and businesses in the coming time.

In order to promote trade with the Russian market, the Ministry of Industry and Trade recommends: Registering to attend trade fairs and exhibitions is an effective trade promotion measure if businesses are well prepared. Therefore, to learn about the market and find customers in Russia, businesses should directly display products or visit large specialized exhibitions in this market.

Making recommendations to localities, associations and businesses, the Ministry of Industry and Trade emphasized: The conflict between Russia and Ukraine in the coming time will continue to have very unpredictable developments.

Therefore, associations and enterprises cooperating with Russia need to closely monitor the market situation to have appropriate response measures. Furthermore, before transacting and signing foreign trade contracts, enterprises need to carefully research/check partners (possibly through the Trade Office), especially partners found on the Internet, to avoid fraud. Notably, the content of the contract must ensure the interests of Vietnamese enterprises.

The Ministry of Industry and Trade affirmed that in the coming time, the Ministry will focus on researching and taking measures to support businesses to proactively organize trade promotion activities. In addition, it encourages localities/associations/enterprises to organize trade promotion delegations (about 5-10 enterprises) to attend specific specialized exhibitions. For example, garments, wooden furniture, consumer goods, food, beverages, coffee, tea, mechanical engineering industry in Russia in 2024. Thereby, helping businesses penetrate deeper into potential markets and helping Vietnam-Russia exports grow sustainably.

TB (according to VNA)

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