In 2022, the two sides successfully organized the 7th Session - Vietnam - Czech Republic Intergovernmental Committee on Economic Cooperation in Prague, this event is of great significance in promoting cooperation between the two countries. Despite being heavily affected by the COVID-19 pandemic, the economic, trade and investment cooperation between the two countries has remained strong and achieved many impressive results.

Today, the economies of Vietnam and the Czech Republic are developing strongly at a high pace, deeply integrating into the regional and global economy. This is an opportunity and condition for the two countries to further promote bilateral cooperation. In terms of trade, bilateral trade turnover has grown steadily over the years, especially after two years of implementing the EVFTA. The Czech Republic always attaches importance to consolidating and developing cooperative relations with Vietnam, considering it the most important partner of the Czech Republic in Southeast Asia; meanwhile, the State and people of Vietnam always hope that the two countries will coordinate more closely in trade cooperation, creating conditions for businesses of both sides to expand investment and business cooperation. Exports from Vietnam and the Czech Republic are not very competitive but are mainly complementary to each other. The Czech Republic considers Vietnam one of its priority partners for economic cooperation outside the EU.

Regarding investment, according to data from the Ministry of Planning and Investment, as of June 2024, the Czech Republic had 41 investment projects in Vietnam with a total registered capital of 92.38 million USD, focusing mainly on the processing, manufacturing and mining industries. The Czech Republic's strong investment cooperation areas are energy, locomotives - railway cars, electric trains, agricultural machinery, etc.

Top 10 largest suppliers of goods to the Czech Republic in the first 4 months of 2024
Unit: %

Source: Trademap

In the first 4 months of 2024, Vietnam was in the top 20 largest export markets to the Czech Republic, ranking first in Southeast Asia and 6th in Asia (after China, Korea, Japan, India and Taiwan).

According to statistics from the General Department of Customs, in 2023, the total bilateral trade turnover between Vietnam and the Czech Republic reached 1.13 billion USD, a significant increase of 36.70% compared to 2022; of which, the export turnover reached 958.05 million USD, a sharp increase of 43.17% compared to 2022; Import turnover reached 176.51 million USD, up 9.8%. Overall, in the period 2019 - 2023, bilateral trade turnover between Vietnam and the Czech Republic recorded a steady increase over the years.

Vietnam - Czech Republic bilateral trade turnover in the period 2019 - 2023 and growth rate compared to the previous year

Source: General Department of Customs

According to data from Trading Economics, the Czech Republic's GDP growth rate increased by 0.2% quarter-on-quarter in the first quarter of 2024, lower than the initial estimate of 0.3% and lower than the downwardly revised growth rate of 0.3% in the previous quarter. The annual inflation rate in the Czech Republic continued to decline to 2% in June 2024, from 2.6% in May and lower than market expectations of 2.5%. This is also the lowest decrease since March, mainly due to the sharp decrease in prices of some items such as food, non-alcoholic beverages, transportation services, entertainment, etc. compared to the previous quarter.

2023 is considered a difficult year for the Czech Republic as the country faces a serious recession. In the last months of the year, the Czech economy showed signs of recovery but still struggled with difficulties from the impact of COVID-19 and the conflict in Ukraine. However, trade activities between Vietnam and the Czech Republic remained stable mainly due to the great efforts of the Governments and businesses of the two countries in implementing trade promotion activities; at the same time, the advantages of the EVFTA Agreement also bring many potential cooperation opportunities for businesses of both sides.

Vietnam's export turnover to the Czech Republic in the period 2013 - 2023

Source: General Department of Customs

Since upgrading the relationship to the level of Comprehensive Strategic Partnership, Vietnam's export of goods to the Czech Republic has improved a lot, mainly recording an increase over the years. However, in 2022, due to the impact of political conflicts in some regions around the world, the export of goods to this country was negatively affected, decreasing sharply compared to 2021, reaching only 1.56 billion USD; by 2023, the export of goods to the Czech Republic recorded a slight recovery, increasing by 12.18% compared to 2022, reaching 1.75 billion USD.

In recent times, the Vietnam Trade Office in the Czech Republic has implemented connection activities for many Vietnamese enterprises exporting agricultural products such as ginger, grapefruit, vegetables and fruits to supermarket chains in the Czech Republic. However, Vietnamese enterprises still face difficulties in supplying goods in large quantities, stably and long-term to partners. Therefore, in order to export to the Czech Republic market more effectively and with better quality, Vietnamese enterprises need to have a specific strategy and quickly build a supply system in the host country to supply to supermarket chains and large stores.

In June 2024, Vietnam's export turnover to the Czech Republic reached 131.28 million USD, an increase of 23.45% compared to the previous month and a very strong increase of 100.69% compared to the same period in 2023; In the first 6 months of 2024 alone, the export turnover of goods to this market recorded a significant increase compared to the first 6 months of 2023 of 66.55%, reaching 661.06 million USD. Of which, the three export items with the highest turnover are Machinery, equipment, tools, and other spare parts (accounting for 44.73%); Computers, electronic products and components (accounting for 34.95%) and Footwear of all kinds (accounting for 7.14%).

Recently, Vietnam and the Czech Republic have been promoting cooperation in the agricultural sector. Although there are many conditions for cooperation, the two-way export turnover of the agricultural sector still accounts for a relatively small proportion of the total turnover. Vietnam wishes to penetrate deeper into the Czech Republic market and is particularly interested in the country's traditional industries such as beer, meat, spirits, confectionery, agricultural technology, food industry, livestock technology and veterinary preparations. Therefore, in the coming time, Vietnam can support the Czech Republic in exporting meat products and the two sides will soon reach an agreement on veterinary requirements and food hygiene and safety for products from the Czech Republic.

In the field of cultivation, the Czech Republic owns a world-leading prestigious company exporting grass seeds, green vegetables, and new plant varieties, bringing high profits to growers. This is the field in which the Czech Republic wishes to promote cooperation with Vietnam.

In June 2024, Vietnam's import turnover of goods from the Czech Republic reached 13.98 million USD, down 18.32% compared to the previous month and down significantly 25.42% compared to the same period in 2023; in the first 6 months of 2024 alone, import turnover from this market recorded an increase of 23.13% compared to the first 6 months of 2023, reaching 103.46 million USD. Of which, the three imported goods with the highest turnover were Machinery, equipment, tools, and other spare parts (accounting for 36.89%); Computers, electronic products and components (accounting for 11.61%) and Chemicals (accounting for 2.36%).

In recent years, the work of connecting and promoting trade to the Czech Republic market has always been focused on by management agencies and the business community:

On February 20, 2023, at the headquarters of the Ministry of Industry and Trade, Minister Nguyen Hong Dien had a meeting and worked with Mr. Jozef Sileka, Minister of Industry and Trade of the Czech Republic and the Czech business delegation accompanying him to Vietnam. At the meeting, the two sides discussed the general situation in economic - trade and investment cooperation between Vietnam and the Czech Republic. Minister Nguyen Hong Dien said that Vietnam and the Czech Republic have a traditional friendship that has been close for many decades; currently, two important mechanisms need to be promoted to promote economic and trade relations between the two countries in the coming time, namely the Vietnam - Czech Republic Intergovernmental Committee on Economic Cooperation; the Vietnam - EU Free Trade Agreement (EVFTA) and the Vietnam - EU Investment Protection Agreement (EVIPA). On the Czech Republic side, Czech Minister of Industry and Trade - Jozef Sileka agreed with the sharing of Minister Nguyen Hong Dien, and emphasized that Vietnam is both a friend and an important partner of the Czech Republic. Therefore, the Czech Republic hopes that the two countries will further strengthen cooperation in the fields of trade, industry and investment.

In April 2023, the Vietnam - Czech Republic Business Forum was held. At the meeting, the Prime Ministers of Vietnam and the Czech Republic agreed on many important contents to enhance the effectiveness and substance of economic and trade cooperation between the two countries in the coming time; including creating conditions for goods from both countries to increasingly access each other's markets; striving to increase trade turnover more strongly in the next 1-2 years. Prime Minister Pham Minh Chinh and the Prime Minister of the Czech Republic witnessed the signing ceremony of cooperation agreements between agencies and enterprises of the two countries, such as the cooperation agreement between the Vietnam Federation of Commerce and Industry and the Czech Chamber of Commerce in exchanging experiences and coordinating support for businesses of the two countries; the memorandum of understanding between Armex Group and the Vietnam Oil and Gas Group on strengthening and promoting joint cooperation between the two units. In the first months of 2024, many important trade promotion activities continued to be organized to promote cooperation between the two sides:

Ho Chi Minh City strengthens agricultural cooperation with partners in the Czech Republic: In March 2024, the Chairman of the Ho Chi Minh City People's Committee had a meeting with the Minister of Agriculture of the Czech Republic who was visiting and working in the City. The City wants to promote comprehensive cooperation in politics, economy, and culture with partners of the Czech Republic; in which, cooperation in the fields of agriculture and food industry is identified as the center of agricultural development cooperation between the two countries. Agreeing and welcoming the proposal to strengthen cooperation of the leaders of Ho Chi Minh City, the Minister of Agriculture of the Czech Republic hopes that the Czech Republic and Vietnam, including Ho Chi Minh City, will have more measures to promote bilateral trade turnover;

In March 2024, during the working visit to Vietnam of the Minister of Agriculture of the Czech Republic, the Embassy of the Czech Republic in Hanoi and the Vietnam Federation of Commerce and Industry (VCCI) organized the Czech - Vietnam Agricultural Business Forum. More than 40 leading Czech enterprises operating in the fields of agriculture and food industry came to Vietnam with the desire to expand cooperation and maximize the trade potential between the two countries. According to the Czech Minister of Agriculture, trade and commerce between the Czech Republic and Vietnam in the agricultural sector has grown strongly in recent years. The two sides still have a lot of potential to continue expanding and developing bilateral cooperation. To promote cooperation in the agricultural sector, the Czech Republic appointed Mr. Luboš Marek as representative of the Ministry of Agriculture of the Czech Republic in Ho Chi Minh City with the aim of supporting the Czech - Vietnamese business community to easily connect and cooperate in the agricultural and food sectors. Vietnam and the Czech Republic have enjoyed close and cooperative relations for decades. The two sides are making efforts to develop bilateral trade relations and strive to create favorable conditions to promote business, trade and investment relations between enterprises of the two countries.

Thuy Linh