The upcoming official visit to Chile by President Luong Cuong is expected to open up new opportunities for trade relations between the two countries, especially as bilateral trade ties have made impressive progress in recent times.
According to the Ministry of Industry and Trade (MoIT), since the Vietnam-Chile Free Trade Agreement (VCFTA) officially came into effect in 2014, Vietnam has consistently maintained a trade surplus with Chile.
Notably, Vietnam's exports to Chile have increased fivefold over the last decade. Furthermore, businesses from the two countries have effectively capitalised on the opportunities brought by the FTA to tap into each other's markets.
Statistics from the General Department of Customs show that in 2023, amidst challenges in the global economy, two-way trade between Vietnam and Chile reached 1.57 billion USD. Of this, Vietnam's exports totaled 1.2 billion USD, while its imports amounted to 375.16 million USD.
Vietnam’s exports to Chile have continued to grow since the beginning of this year. In the first nine months of 2024, bilateral trade value hit 1.29 billion USD, with Vietnam exporting 1.04 billion USD worth of goods. Chile is currently the fourth largest trade partner of Vietnam in Latin America, following Brazil, Mexico, and Argentina.
Vietnam's key export products to Chile are phones and accessories; machinery, equipment, and other spare parts; textiles and garments; footwear; clinker and cement; rice; bags, wallets, suitcases, hats, umbrellas; and coffee. Among these, phones and accessories make up the largest share of Vietnam's exports to the Latin American country.
Meanwhile, Vietnam’s imports from Chile mainly consist of raw materials for producing export goods, such as copper, plantation wood, paper pulp, wine, fresh fruits, animal and vegetable oils, animal feed and ingredients, and scrap metal.
According to the European-American Market Department under the MoIT, in recent years, the MoIT and the Ministry of Foreign Affairs of Chile have alternately organised the Vietnam-Chile Free Trade Council (VCFTC)’s meetings.
The council serves as an effective mechanism to review the implementation of the VCFTA and promote bilateral cooperation in areas of economics, trade, investment, agriculture, education, healthcare, and science - technology.
The VCFTC’s fifth meeting was held in June this year in Hanoi under the co-chair of Deputy Minister of Industry and Trade Nguyen Hoang Long and Vice Minister for International Economic Relations of the Ministry of Foreign Affairs of Chile Claudia Sanhueza. It identified key issues that need to be implemented in the coming time to boost bilateral economic, trade, and investment cooperation.
Although the VCFTA only includes commitments on goods, it has provided a significant boost to the economic and trade relations between the two countries.
Experts said the trade pact allows Vietnamese products to enter the Chilean market with tariff preferences, facilitating their competition with products from other countries. Additionally, the CPTPP, which officially came into effect for Chile in February 2023, has brought about new opportunities for businesses from Vietnam and Chile to expand trade and investment cooperation in each other's markets.
Chile's membership in the Pacific Alliance makes it easier for Vietnamese businesses to access not only the Chilean market but also other member countries of the alliance such as Peru, Colombia, and Mexico.
With a population of over 19 million and high per capita income, Chile has significant consumption demand in South America. Vietnamese products are favoured by Chilean consumers, creating favourable conditions for Vietnamese businesses to export to this market.
To promote the export of Vietnamese goods to Chile, businesses are advised to focus on market survey to gain a thorough understanding of consumer demands and trends; as well as stay updated on Chile's economic, trade, and investment policies through state support agencies, such as the MoIT, the Vietnamese Embassy in Chile, and the Chilean Embassy in Vietnam.
Attention must be paid to trade promotion and connection activities, as well as building brands and marketing strategies through communication channels and international events, to seek cooperation opportunities with Chilean partners, experts said./.
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