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Vietnam - Laos: more expectations of economic cooperation in 2013

Although a new height of cooperation has been reached in 2012, cooperation on economics, trade, especially on industry between Vietnam and Laos is still in potentials and full space of development.

Once difficulties have been overcome, trading exchange between Vietnam and Laos achieved a high growth rate - more than 23%, with a turnover (gross value) of more than 900 million US dollars. Particularly, export from Vietnam to Laos increased significantly, contributing to decrease Vietnam’s import deficit from Laos down to tens of million dollars.

Although the structure of exchanged goods has not been changed much, enterprises from the two countries have gained numbers of close relations which are indicated through trading activities, product exhibiting fairs held by the two countries. Moreover, the level of penetrating into Lao market and joint manufacturing between enterprises of the two countries has been upgraded as well.

Up to the end of 2012, Vietnam has more than 220 development projects to Laos with a gross registered capital of more than 4 billion U.S. dollars; as such industrial sector accounted for 40% of the capital.

Industrial cooperation is expected to create incentives for trade of Vietnam and Laos in order to achieve the targets agreed by leaders of the two countries, particularly, such as any large energy projects of Vietnamese enterprises in Laos, increase of machinery import, equipment from Vietnam, and creating strong effect for cooperation on other aspects.

In 2013, development sectors that estimated to have chance of strong development are (1) energies such as hydropower, natural gas and fuel, (2) mining, processing industry and (3) agriculture such as coffee, rubber, livestock raising, etc. The consuming market in Laos is still capable for Vietnamese goods to take good effect by any trading fairs held in Laos by Vietnamese enterprises.

Beside the tax-prioritizing program between Vietnam and Laos, there are 95% of goods made in Vietnam and Laos and exported to each other have been given tax-cut and privilege which is a great potential for enterprises in trading and linking manufacture.

A huge potential that making a breakthrough in economic cooperation between Vietnam and Laos is the economic change between border-sharing locals of the two countries – a wide area includes 10 provinces of Vietnam and 10 provinces of Laos which is plenty of unexploited economic resources.

In 2012, Vietnam and Laos have completed the project of bordering market network Vietnam - Laos until 2020. And the first project is the Dam Din market upgrading project in Xiengkhoang Province, located oppositely with Nghe An Province of Vietnam, estimated to nearly getting started.  

After the completion, the bordering market network will play a basically important role in trade and manufacture between border-sharing locals of the two countries – Vietnam and Laos, opening more new opportunities for cooperation and either country’s advantage exploration.

However, in order to increase the size and quality of economic cooperation between Vietnam and Laos, create favorable conditions for Vietnamese products to hold more market share in Laos, it is very necessary to have market-approaching assistances from the government such as holding more Vietnamese goods-exhibiting fairs at local areas in Laos, developing distribution system, and strengthening the groups of trading interactions in the market.

To appropriate with new market size and conditions of economic and trade relations between the two countries, the Ministry of Industry and Commerce has proposed that the two countries should research, negotiate and sign a new trade agreement.

Source: (The Government of Vietnam’s website )