Vietnam took market share of EU trade away from other Southeast Asian nations last year, a trend that might continue after it concluded a free-trade agreement with the regional bloc.
The nation accounted for 19.1 percent of the 201.4 billion euros (US$227 billion) in total trade between the EU and members of ASEAN last year. That figure is up from 15.8 percent in 2014, according to data from the EU delegation in Singapore.
Signs of Vietnam’s trade prominence are growing: In 2014, the nation overtook its ASEAN neighbors to become the biggest exporter to the US, powering ahead of traditional manufacturing hubs such as Thailand and Malaysia. Vietnam has capitalized on shifting production patterns in Asia as labor costs in China rise.
While EU trade with Singapore, which is still the bloc’s biggest partner in Southeast Asia, increased last year, its market share of total trade fell to 24.1 percent from 25.1 percent. Malaysia, Thailand and Indonesia also lost market share to Vietnam.
Vietnam is the second nation in ASEAN after Singapore that the EU has concluded a free-trade pact with. Exports from Vietnam to the EU are dominated by telephones, electronic products, footwear, clothing and coffee.
Vietnam has also matured into demanding more advanced technologies, which Europe is still a key provider of.
Total EU trade with ASEAN rose 12 percent last year. China’s trade with the European regional bloc amounted to 520.8 billion euros last year, more than double that of ASEAN’s trade, according to EU data.
The EU has targeted Vietnam and Singapore in a new business initiative aimed at exposing small and medium-sized companies in Europe to opportunities in Southeast Asia. The EU is to help facilitate meetings between companies in the two regions in industries ranging from water to food and beverages.
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