With US$4.432 billion of export turnover to South Korea and US$9.942 billion of import turnover from Korea in the first four months of the year, the country has become the biggest partner with which Vietnam has a trade deficit.
South Korea boosted its exports after Vietnam gradually removed the import tariff. Photo: Internet
Machines, equipment, tools and accessories are products Vietnam has spent the most money on: import turnover of the products reached $11.5 billion, an increase of 39.3 percent over the same period last year.
South Korea has replaced China to become the largest supplier of this category of products ($3.79 billion, up by 135 percent, vs $3.4 billion, up by 31 percent).
South Korea continued to be the biggest exporter of computers, electronics and electronic components with $3.84 billion worth of export turnover, an increase of 39.2 percent over the last year same period.
Meanwhile, China, the second biggest exporter of these products, only exported $2.09 billion worth products to Vietnam.
Analysts noted that the petroleum imports from South Korea soared to 986,000 tons, which was twice as much as the same period last year, while imports from other markets all decreased.
South Korea enjoys the most preferential tariffs under the ASEAN-Korea FTA and Vietnam-Korea FTA (VKFTA).
Experts said thanks to VNFTA, the trade between the two countries has increased significantly.
South Korea boosted its exports after Vietnam gradually removed the import tariff on 89.9 percent of import products from South Korea within 15 years, since the day the agreement took effect in late 2015.
The sharp increase in South Korean investment in Vietnam in the last four years is also the reason behind the increased exports to Vietnam.
Since more and more South Korean conglomerates set up their factories in Vietnam, they need to import more input materials for production and assembly in Vietnam.
Korean consumer goods
Lock&Lock last week opened a P&Q (Price & Quality) shop in HCMC after developing its household-use goods chain in cities and provinces and bringing its products to large shopping malls and supermarkets.
Chun Hae Wo, CEO of Lock&Lock Vietnam, said the group will open more P&Q shops in HCMC and other cities to distribute consumer goods. Sixty percent of products have selling prices of less than VND100,000, believed to compete directly with Vietnamese products. Lock&Lock, like other South Korean enterprises, have been approaching Vietnamese consumers through exhibitions and trade fairs.
They introduce a wide range of goods and services, from food, farm produce and fresh fruit to cosmetics, decoration products and electronics.
Kim Jung Gwan from Kita said Vietnam is an attractive market for Koran businessmen because it connects ASEAN, India and China.
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