Vietnam’s growing economy presents opportunity for Victorian importers and exporters

20 August 2021

Though the COVID-19 pandemic dealt a drastic blow to numerous economies across the globe, some have been able to come out on top, including Vietnam - the success story of South-East Asia.

JUMP TO:
JUMP TO:

The COVID-19 pandemic has had a devastating impact on countless supply chains, created mass unemployment and shut down entire industry sectors across the globe. As the economic foundations shift under the global giants, some smaller and developing nations are finding ways to capitalise. 

With a population of more than 96 million, Vietnam has not only endured the COVID-19 pandemic, but thrived to become one of Australia’s fastest-growing trade markets.

Crisis and opportunity 

During the rise of the COVID-19 pandemic in 2020, on March 3 the Vietnamese government acted boldly and became one of the first countries in the world to provide support measures for local businesses who would soon be doing it tough with imminent disruption to both import and export supply chains. 

The support measures that the government offered were designed with a dual purpose. While the 27 trillion dong ($1.61 billion) assistance measures were aimed to assist business save money via tax breaks, delayed tax payments and reduction in land lease fees, the Vietnamese government ramped up other spending. By doubling-down on spending for infrastructure projects and aggressively expanding the economy, the Vietnamese government had a clear and ambitious plan to keep the country moving forward despite the turbulence of foreign markets.  

Through their quick actions and decisive gameplan, in the first nine months of 2020, Vietnam managed to maintain a GDP growth of 2.12 per cent as larger and more developed nations plummeted. Vietnam now has a projected post-COVID-19 growth of 6.5 per cent in 2021 - one of the few nations to see growth during the pandemic. 

Vietnam’s success in managing the COVID-19 pandemic is now attracting global investors from more than 100 countries into its industrial zones. Many businesses who traditionally had facilities in China are now relocating to Vietnam in a bid to find a safer and more stable environment to operate.  

As physical supply chains and face-to-face contact diminished throughout 2020, the COVID-19 pandemic has accelerated the digital transformation of the world. While digital networks in Vietnam are small and locally focused, the financial technology, telecommunications, electronics and computer manufacturing sectors are now among Vietnam's fastest-growing sectors. The Vietnamese government has subsequently announced investments to upgrade digital infrastructure, e-government, e-commerce, and ultimately, e-society.  

Victoria and Vietnam 

A new report by Asia Society Australia and The Australian APEC Study Centre, A Path to Viet Nam: Opportunities and Market Insights for Australian Business, details how Vietnam has become an ideal economic partner for Australia, with complimentary economic systems, elevated government-to-government relationships and significant opportunities for Victorian importers and exporters. 

In 2018, Vietnam ranked 13th as Victoria’s largest trading partner. With the two-way trade relationship valued at $2.3 billion before the rise of the COVID-19 pandemic, the key components were education and travel services, agricultural commodities (mainly fruit and nuts) and manufactured goods including plastics and medicaments. 

While the COVID-19 pandemic has disrupted traditional trade and transport, education services have proven to be a sustainable and lucrative export. 

It has become clear that Victoria is the place to be for Vietnamese students, with 40 per cent of all Vietnamese students in Australia enrolling in Victoria. In 2019 alone, more than 13,000 students from Vietnam enrolled in a Victorian school, TAFE, college or university. 

The State’s international education services sector has proven to be a burgeoning area during the COVID-19 pandemic and is likely to remain sought after post-COVID-19. 

Vietnam on the Map Program 

The Victorian Chamber of Commerce and Industry, with support from Vietnam Economic Strategy Team of the Department of Foreign Affairs and Trade has launched the Vietnam on the Map Program.  

The program, comprised of a five-module series, outlines and identifies existing and potential opportunities and challenges in the Vietnamese market. Each module in the course will cover: 

  • Vietnam market fundamentals 
  • Market entry strategy and options 
  • Regulatory compliance and export logistics 
  • Selling to Vietnamese consumers 
  • Business culture, etiquette and negotiations 

Participants of the program will be supported by governments, chambers of commerce and industry experts from both Australia and Vietnam. 

To register for each event, visit the Victorian Chamber’s events website here to take the first step in your journey to Vietnam. 

Join the Chamber

Want to grow your business, seek HR advice, up-skill your staff and network at events? Become a member today to access a great range of member benefits to support your business.