The dynamic trade relationship between Vietnam and Israel is poised to reach new heights, with expectations of trade revenues surging to 3-4 billion USD soon. This promising outlook stems from the duo’s steadfast commitment to trade liberalization, a topic that took center stage at a recent forum held in Hanoi on August 16.
The forum was chaired by Nir Barkat (Israel’s Minister of Economy and Industry) in conjunction with Nguyen Hong Dien (Vietnam’s Minister of Industry and Trade). During the discussions, Minister Dien underscored the impact of the Vietnam-Israel Free Trade Agreement (VIFTA), a monumental accord set to galvanize businesses in both nations.
Israel’s role as a prominent partner of Vietnam in West Asia is undeniable. The steady rise in bilateral trade, which spiked from 1.2 billion USD in 2019 to an impressive 2.2 billion USD three years later, speaks volumes about the robust nature of their alliance.
This economic exchange is further enriched by a longstanding collaboration in agriculture, with a pivotal agreement signed in 1997. Israel’s unwavering support in nurturing Vietnamese expertise in science and technology has cemented its pivotal role in the nation’s development.
Powering Economic Growth
Israel’s significant foreign direct investment (FDI) footprint within Vietnam is a compelling aspect of this bilateral partnership. As of July 20, 2023, Israel has spearheaded 40 FDI projects valued at over 140 million USD.
This move caused Israel to occupy the 47th spot among the 148 countries and territories investing in Vietnam. Moreover, Israel has solidified its rank as Vietnam’s fifth-largest trading partner and the third-largest importer within the Middle Eastern region.
The country’s ranking at 33rd place amongst over 200 countries and territories engaged in trade ties with Vietnam showcases the depth and breadth of its economic integration. The convergence of the two economies will result in mutual benefits, with both nations poised to unlock new dimensions of growth.
Capitalizing on Israel’s prowess in science and technology, there is an urgent call for Israeli enterprises to venture into Vietnam’s burgeoning economic landscape. The electronics, industrial, chemical, and energy sectors present fertile ground for innovation and expansion.
Vietnam’s Strategic Position
Under the strategic partnerships between both countries, Israeli business operators can access Vietnam’s thriving market of over 100 million consumers. Furthermore, these partnerships provide access to the broader network of the Asia-Pacific, Association of Southeast Asian Nations (ASEAN), and the 16 Free Trade Agreements (FTAs) embraced by Vietnam, encompassing nearly 6 billion consumers.
Nevertheless, Tran Quang Huy, a Director of Vietnam’s Ministry of Industry, claims that ample avenues remain unexplored for Vietnam and Israel to fortify their economic and trade alliance. Hence, he calls for heightened trade promotion initiatives, assuring that the ministry and its allied agencies will continue to lend unwavering support.