Vietnam is hoping that it will be able to increase its exports of certain agricultural products to South Africa. In particular, it is seeking to increase its exports of coffee, tea, rice and peppers. In parallel, South Africa is also hoping to increase its exports to the South-East Asian country, particularly manufactured and processed products.

According to South African Revenue Service (Sars) figures, Vietnamese exports to South Africa last year totalled R9 569 664 861, while South African exports to Vietnam came to only R1 643  004 737. The respective figures for 2012 came to R5 278 674 621 and R782 331 721, giving Vietnam a considerable trade surplus.

Unsurprisingly, South Africa wants to narrow this trade gap. In February, a delegation of South African wine producers and exporters visited Ho Chi Minh City (also still known as Saigon) and Hanoi to explore opportunities in the Vietnamese market. The mission was organised jointly by the South African Wine Association, the South African embassy in Hanoi and South Africa’s Honorary Consul in Ho Chi Minh City. Wine consumption is increasing in the South-East Asian country.

In March, the South African Department of Trade and Industry (DTI) led a delegation representing 16 companies on an outward selling mission to Vietnam. Prior to the departure of the mission, Trade and Industry Minister Dr Rob Davies noted: “Vietnam has a fast expanding middle class, presenting opportunities to export food and wine. The authorities in that country have also moved to implement the structural reforms needed to modernise the economy and to produce more competitive export-driven industries.”

The trade mission was focused on the aerospace and marine, agriprocessing, capital equipment, chemicals and information and communication technology (ICT) sectors. At a seminar held in Ho Chi Minh City during the delegation’s visit, the potential for bilateral cooperation in the agriprocessing, garment and textile and mining sectors was highlighted. The possibilities discussed included the creation of joint ventures.

According to the DTI, South Africa’s main exports to Vietnam during the 2012/13 financial year were scrap iron and steel (‘ferrous waste’); aluminium plate, sheets and strip; and unwrought aluminium. According to Sars, during the calendar year 2013, South Africa’s main exports to Vietnam were precious metals (worth R1 013 554 070), vegetables (R182 732 847), live animals (R161 182 958), raw hides and leather (R92 361 674), chemicals (R71 466 706), machinery (R31 929 767), wood products (R29 624 143) and plastics and rubber (R26 677 967).

Also for calendar 2013, Sars reports South Africa’s main imports from Vietnam to have been led by machinery, worth R6 809 494 405. Next came footwear, at R1 091 610 802, vegetables (R511 568 036), textiles (R291 783 911), chemicals (R183 116 794), toys and sports apparel (R159 492 435), iron and steel products (R118 152 695) and plastics and rubber (R84 710 644).

Mutual investment is currently insignificant. According to the English-language daily newspaper Viet Nam News, South African investment in the South-East Asian country amounts to just $180 000 (divided between three projects). Vietnamese investment in South Africa is just starting, with companies from the country investing in projects to construct bonded warehouses in this country. The newspaper gave no value to these projects, but identified Vietnamese companies Ha Noi Trade Corporation, Truong Thanh Furniture Corporation and Vietranimex as being among those involved.

South Africa is eager to encourage further Vietnamese investment, the newspaper has also reported. It states that South Africa was particularly interested in cooperation with the province of Binh Dinh regarding forestry, forestry products and tourism. At the end of February, there was a South African- Vietnamese workshop in Binh Dinh, during which the matter was discussed. The province is one of Vietnam’s three main forestry areas, bringing in $2.3-billion in export turnover since 2010. Other investment areas that the South African participants advertised were in the agriprocessing, automotive, chemicals, electronics and plastics sectors. Other areas were footwear, garments and textiles, ICT, metallurgy, tourism and transport.

Vietnam has a dynamic economy. According to The World Factbook 2014, it grew at an estimated rate of 5.3% last year, 5.2% in 2012 and 6.2% in 2011. In purchasing power parity terms, the country’s gross domestic product (GDP) was estimated at $358.9-billion, ranking it 38th in the world (South Africa was 26th). Agriculture accounted for 19.3% of GDP, industry (including mining) 38.5% and services 42.2%. Vietnam’s industries include (as listed by The World Factbook) food processing, garments, shoes, machine-building, mining, coal, steel, cement, chemical fertilisers, glass, tyres, oil and mobile phones. Agricultural products are rice, coffee, rubber, tea, pepper, soybeans, cashews, sugar cane, peanuts, bananas, poultry, fish and seafood.