Vietnamese enterprises see growing agri export opportunities in Chile

Vietnamese businesses have a growing opportunity to expand their presence in Chile, particularly in the processing and export of agricultural products, thanks to free trade agreements and tax incentives.

Ho Thi Quyen, deputy director of the Investment and Trade Promotion Center of Ho Chi Minh City (ITPC), made the remarks at the workshop “Promoting trade and investment in the Chilean market and the South American,” organized by ITPC in collaboration with the Chilean Export Promotion Agency (ProChile) in HCMC on Tuesday.

In the context of deepening international economic integration, Quyen emphasized that expanding markets, diversifying trade partners, and attracting investment are key priorities for both Vietnam and HCMC.

Chile, known for its dynamic economy and open trade policies, is a significant partner for Vietnam in South America. The two countries signed the Vietnam-Chile Free Trade Agreement (VCFTA) in 2014 and are both members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), establishing a strong legal framework that enhances bilateral cooperation.

Chile also serves as a strategic gateway for Vietnamese companies looking to access larger South American markets, including Brazil, Argentina, and Peru. In 2024, Vietnam-Chile bilateral trade reached nearly $1.8 billion, with Vietnam exporting approximately $1.4 billion worth of goods and importing around $330 million.

Vietnam’s main exports to Chile include seafood, coffee, rice, and cement. Currently, the country ranks as the 12th-largest supplier of goods to Chile and is the fourth-largest among Asian exporters to the country, behind only China, Japan, and South Korea, added Quyen.

She highlighted Chile’s appeal as an investment destination due to its transparent business environment, stable policies, and solid economic growth. In 2024, Chile attracted over $15.3 billion in FDI, primarily in energy, mining, and global services. Meanwhile, Chilean investment in Vietnam remains modest, with just four active projects totaling $295,000 in registered capital as of April 2024.

With support from trade agreements and fiscal incentives, Vietnamese enterprises have ample opportunities to increase exports and investment in Chile - particularly in agricultural processing, manufacturing, and technology cooperation aimed at sustainable development.

In 2024, HCMC’s exports to Chile were estimated at $53.3 million, a figure that remains relatively modest compared to the full potential of the relationship. This signals significant room for growth and enhanced bilateral cooperation.

Bui Hoang Yen, head of the Southern Trade Promotion Office under the Ministry of Industry and Trade, said that free trade agreements (FTAs) have been instrumental in driving trade growth. Vietnam’s turnover of export to Chile has increased by approximately 200% over the first 10 years of the VCFTA’s implementation.

However, utilization of preferential certificates of origin (C/O) under Vietnam’s FTAs varies significantly across markets. While the VCFTA recorded a utilization rate of 40.9% in 2023, the CPTPP saw a rate of just 6.3% for exports to ratified member countries.

Yen also pointed to potential areas for cooperation with Chile that align with Vietnam’s economic development goals, including green energy, mining, high-tech industries, digital transformation, and smart agriculture.

She cautioned, however, that businesses must address challenges such as high logistics costs, long transit times, stiff competition due to Chile’s multiple FTAs, and technical barriers. Overcoming these issues will require greater investment in technology, improved management systems, and stronger policy and market support.

Pablo Arancibia Salazar, trade representative of ProChile, noted that Vietnam’s total export volume to the South American bloc - including Brazil, Chile, Argentina, and Colombia - remains limited. He urged Vietnamese enterprises to diversify export products and stabilize their raw material supply chains.

Chile is positioning itself as a strategic investment hub in South America, offering Vietnamese companies cooperation opportunities in sectors such as seafood, wood processing, and clean energy. The country serves not only as a trade gateway but also as a strategic partner for expanding into South America - a region with a combined GDP of $4 trillion and a population of 431 million.

To fully realize this potential, trade promotion agencies from both countries are encouraged to regularly host business matchmaking events, share market intelligence, and support Vietnamese firms in finding strategic partners.