Latin America's Trade Industry to Expand in Vietnam
In an unprecedented Trans-Pacific Partnership trade agreement between Vietnam and Latin America, the latter sees great investment in the Vietnam region, which offers young and new generation labor force. The low cost of manufacturing in the country is also seen to have added to the arrival of new investments in Vietnam.
According to the Vietnam Briefing, the TPP is said to have brought Vietnam great partnerships with the U.S., Japan and, now, Latin America in terms of trading. In particular, Chile, Peru and Mexico have seen some great investment prospect in Vietnam, with Chile leading the business partnership ahead.
Vietnam currently enjoys a free-trade agreement with Chile, and with the FTA's short reign, the two countries have definitely emerged at an advantage over the agreement. The past five years have seen a constant 26.8 percent in trade growth. In 2015, exports from Chile to Vietnam have reached $244.7 million while exports from Vietnam to Chile reached a staggering amount of $515.5 million. Out of the three Latin American countries, Chile is the only one who practices the free-trade agreement with Vietnam.
Mexico, on the other hand, remains to be Vietnam's second largest trading partner in the Latin America region. Despite the absence of the FTA, the countries' bilateral agreement on trading has reached around $1.7 billion until 2015. The growth has been propelled by a yearly 57 percent increase on investments and trading. At the end of year 2015, the agreement was also expected to bring in a total of $1.98 billion in investment to Vietnam, a 52 percent increase from previous statistics. Major imports from Mexico to Vietnam range from electronics to machinery and equipment. Scrap iron and steel have also been some of the most imported products from Mexico.
On Aug. 31, 2015, the Peruvian Ministry of Foreign Relations and the Vietnamese Ministry of Industry and Trade signed an agreement that strengthened partnership on economic, trade and technological issues. The agreement also established some new and concrete framework in other areas of possible investments such as agriculture. The Trans-Pacific Partnership between Peru and Vietnam will see the latter decrease its traffic on seafood products, something that will give boost on the Peruvian export value.
Meanwhile, the Peruvian Embassy in Vietnam opened its doors in May after more than 21 years of diplomatic relations and some $300 million trade value since 2014. Vietnam, in return, is also expected to open its Embassy in Lima, Peru soon.
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