VietNamNet Bridge – Now that demand from Western customers is depressed by the global economic crisis, Vietnamese businesses have been eyeing Cambodia, a neighbouring market to which they have paid little attention in the past.
Fifty Vietnamese businesses joined an ‘export-on-the-spot’ fair on August 23 at the newly-opened Tinh Bien Border Economic Zone (BEZ). The new facility is at a border crossing between Vietnam’s delta province of An Giang and Cambodia’s Takeo province, south of the Cambodian capital, Phnom Penh.
The export fair was jointly organized by the Ministry of Industry and Trade and the An Giang province People’s Committee.
Boosting export through bonded zone
A bonded zone has been established, to which businesses can bring goods and contact many prospective buyers from Cambodia, from petty merchants to big distributors. The Vietnamese businesses will not have to pay taxes (VAT and export tariff) on their sales, and they can take advantage of simplified export procedures. Meanwhile, Cambodian distributors will be able to take ownership of goods right on the other side of the border.
Many businesses have expressed their interest in this model of selling goods. Vu Quoc Dung, representing the footware maker, Bita, said that the company had sent 100,000 sample pairs of shoes to distributors in Cambodia a month earlier, and now he had come to Tinh Bien to make direct contacts with partners. Phu An Sinh Company is striving to sell frozen and processed food to Cambodia, while Kem Nghia Company aims to sell low-priced beauticians’ tools.
Many enterprises have successfully contacted Cambodian distributors, while Sacombank has helped businesses in payment procedures.
Setting up direct distribution systems
To boost exports to Cambodia, My Hao Cosmetics Company has decided to recruit a Cambodian sales director. My Hao General Director Luong Van Vinh said that because Cambodian people’s income remains low, they are interested in low cost products. This has prompted My Hao to make products suitable to that market.
The Duy Tan Plastics Company has concluded that Vietnam-made household plasticwares can compete well with Thai products in the Cambodian market, said a representative of that firm. The company’s sales in Cambodia have increased steadily. Vinamit, a farm products processor, has also decided to set up a direct distribution network in Cambodia to boost sales instead of selling goods though agents. Nutifo od said that dairy products for old people and for children will be its key products in Cambodian market.
Exports to Cambodia have been increasing so smoothly that export revenues of HCMC businesses to Cambodia in the first seven months of 2009 increased by 44 percent over the same period of 2008, even though the city’s export revenues in general decreased by 13.9 percent. Medicines, fertilizer, steel, construction materials, cosmetics, fruit, seafood and apparel are in particularly high demand.
The HCM City Trade and Investment Promotion Centre has been tasked with coordination of the export offensive. Four big corporations are expected to support the plan’s implementation: the Saigon Trade Corporation, Saigon Co-op, the Saigon Industry Corporation and Saigon Agricultural Corporation. Another large scale Vietnamese products fair is planned to be held soon in the western Cambodian city of Battambang.
An Giang Province chairman leads marketing for Vietnam made goods
To ensure the success of the export fair at Tinh Bien BEX, Lam Minh Chieu, Chairman of An Giang province led a delegation of Vietnamese businesses to Cambodia to build interest in Vietnamese goods.
Particularly, Chieu asked two Vietnamese enterprises to give pesticide and agriculture technique training to Cambodian farmers on August 22 and 23.
Chieu noted that the economic zones in which the State has made heavy investment ought to be, not simply the places where foreign-made goods can be bought cheaply, but also ‘doors’ that introduce Vietnamese goods to foreign countries.