Opportunity to export to the Chilean market
Although it is a small market with 19 million people, Chile is Vietnam's third largest export market in Latin America after Brazil and Mexico. The Chilean market has great potential for Vietnamese businesses because it is an open market and the average import tax is ranked among the world's low average, less than 2%. Notably, through the Chilean market, Vietnamese businesses can expand their export markets to South American countries.
Regarding Chile's product structure, light industries and consumer goods production are not Chile's strengths and cannot meet the growing needs of the country's people. Every year, Chile has to import over 16 billion USD of consumer goods. Therefore, import and export products between Vietnam and Chile are mainly complementary, not competitive with each other. Vietnamese products exported to Chile include phones, components, machinery, equipment, shoes, and textiles. Vietnam imports seafood, fruits and raw materials for production from Chile.
The Vietnam Trade Office in Chile recommends that Vietnamese export businesses should note that products exported to the Chilean market must have their origin and labels on the packaging. Specifications on each packaged product must clearly show hygiene quality, ingredient blend, nutritional value, ingredient ratio... and must be printed in Spanish.
Advantages from free trade agreements signed between Vietnam and Chile
Recently, Vietnam has made good use of the Free Trade Agreement (FTA) between Vietnam and Chile (effective since 2014). Since this FTA took effect, Vietnam's trade turnover with Chile has shifted to a trade surplus with a surplus in 2022 of more than 1.3 billion USD.
With the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Chile commits to cutting 95.1% of the total number of tariff lines that will be eliminated immediately after the Agreement takes effect and 99.9% of the total number of tariff lines. Taxes will be eliminated in the 8th year. However, because Chile is a late ratifying country, the CPTPP agreement will only take effect in Chile from February 2023. In addition, the CPTPP's tariff incentives compared to There are not many bilateral FTAs because bilateral FTAs have been implemented for nearly 10 years and most tariffs have gone to zero. However, because CPTPP has many member countries, Vietnamese businesses can take advantage of the diversity of supply to meet C/O origin certification standards in CPTPP better than bilateral FTA./.
Minh Toan
