Sri Lanka to improve trade ties, keen to use Vietnam as a base to reach Far East
Sri Lanka is keen to improve trade with Vietnam and use it as a springboard to reach the far eastern markets. Vietnam meanwhile is keen to import more coconuts from Sri Lanka, collaborate in garment manufacturing and also vying to set up a manufacturing plant for two wheel tractors here.
These facts emerged when Vietnam’s ambassador to Sri Lanka Ton Sinh Thanh made a courtesy call on Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka on Tuesday 6 September.
Both Minister Bathiudeen and Ambassador Sinh Thanh focused on strengthening trade cooperation between the two countries through increased exchanges of business delegations. “I believe there is potential to use Vietnam as a base to reach the Far Eastern economies. We also invite Vietnam business and industry delegation to our mega exhibition Sri Lanka Expo 2012 to be held in March 2012. I strongly believe that this will energise trade cooperation between the two countries” Minister Bathiudeen revealed.
“Sri Lanka can also offer consultancy/professional services in the field of engineering, architecture, construction, hotel management and business management” Minister Bathiudeen apprised Ambassador Sinh Thanh.
“The Vietnam garments industry could synergise with Sri Lanka for international mutual gains. Vietnam and Sri Lanka can jointly produce garments by combining chains of production. Sri Lanka can make use of Vietnam’s low labour costs to this end,” Ambassador Sinh Thanh apprised Minister Bathiudeen. In reply, Minister Bathiudeen said: “I believe there is potential for joint ventures and collaboration between Vietnam and Sri Lanka in the garments sector which we need to explore further. Sri Lanka’s target for 2015 is US $ 5 billion in garment exports.”
In 2010, Vietnam’s textile and garment industry exports stood at $ 11.2 b, with a 23% growth compared to 2009.
Ambassador Sinh Thanh said that Vietnam is keen to explore setting up of a two wheel tractor manufacturing facility in Sri Lanka for the Sri Lankan market. “Such a production line will help the agro sector in Sri Lanka. Also among the promising Sri Lankan products to the Vietnam retail market which is about US $ 80 m are coconuts and gems. Vietnam likes to import Sri Lankan coconuts in the million-nuts-volumes. As for industrial exports, a promising Sri Lankan product to Vietnam is natural fibre” Sinh Thanh revealed.
According to the Department of Commerce under the Ministry of Industry and Commerce, the total trade between Sri Lanka and Vietnam amounted to US$ 64.73 m in 2010. In 2010, Natural Rubber was the main item of import which represented around 23.03% of the total imports valued at US $ 10.09 m. Other items that Sri Lanka has imported from Vietnam from time to time are yarn, synthetic filaments yarn, polymers of ethylene, in primary forms and tractors. Sri Lanka’s major exports to Vietnam are knitted or crocheted fabrics, bran, sharps and other residues, natural rubber and oil seeds. Vietnam is one of the biggest exporter of rice and other small grains to the world with comparatively cheap labour in the region.
Sri Lankan tea brands are very popular among tea drinkers in Vietnam. Ceylon tea has become popular in the Vietnamese market due to its quality. Vietnam has also emerged as a tea exporting country after Kenya, Sri Lanka, India, China and Indonesia.