Vietnam is in the process of promoting FTA negotiations with the Mercosur bloc, to turn this FTA into a driving force to exploit the export market in Latin America.

Vietnam is in the process of promoting negotiations on the Free Trade Agreement (FTA) with the South American Common Market (Mercosur), to turn this FTA into a driving force to exploit the Latin American export market.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), Mercosur is a sub-regional bloc established in 1991 by countries including Argentina, Brazil, Paraguay and Uruguay.

Mercosur is a dynamic, competitive and developing economic and industrial region, with growing influence as the 5th largest economic block in the world. With an important geographical location in the East Asia and Asia-Pacific region, Vietnam is an important gateway for Mercosur countries to enter the ASEAN market.

As a member of the Mercosur bloc, Brazil is currently Vietnam's largest trading partner in the bloc and in Southeast Asia.

According to statistics from the General Department of Customs, in the first half of June, Vietnam's pangasius export turnover reached 4 million USD, up 5% over the same period last year. Cumulative pangasius exports as of the first half of June reached 50 million USD, up 47% over the same period in 2023.

Since the beginning of this year, Brazil has almost only imported frozen pangasius products and frozen pangasius fillets from Vietnam with HS code 03046200. The largest pangasius supplier to this market in the first 5 months of this year is Hung Ca 2 (accounting for 19% of the value proportion).

Chart of Vietnamese pangasius exports to the Brazilian market

In addition, Vietnamese pangasius exports to markets in the bloc are considered to still have potential. By the end of May, pangasius exports to Argentina reached nearly 1.5 million USD (up 238%), and Uruguay reached more than 700,000 USD (up 2%). Meanwhile, Paraguay is still quite limited in importing pangasius from Vietnam. This country is a major exporter of agricultural products, livestock and electrical energy in the world. Currently, Vinh Hoan is the only Vietnamese enterprise exporting to this market in the first 5 months of this year.

Due to geographical distance and language differences, there are no direct freight or passenger transport routes; leading to high logistics costs for goods from Vietnam to this market and the two sides do not have a free trade agreement.

Therefore, VASEP expects that with the potential, Vietnam and the Mercosur market block will soon have the first FTA, paving the way for export trade cooperation between the two sides, including pangasius export.

Source: Cong Thuong Newspaper