Developing Trade Relations between Vietnam - Germany

This paper analyzes the current state of trade relations between Vietnam and Germany, assesses the advantages and disadvantages, and suggests policy implications for developing trade relations between the two countries in the future.
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Developing Trade Relations between Vietnam - GermanyVNU Journal of Science: Economics and Business, Vol. 33, No. 5E (2017) 70-75Developing Trade Relations between Vietnam-GermanyDuong Thi Tinh*University of Economics and Business Administration - Thai Nguyen University,Tan Thinh Ward, Thai Nguyen City, VietnamReceived 21 July 2017Revised 15 December 2017; Accepted 25 December 2017Abstract: More than 40 years of establishing diplomatic relations and developing trade betweenVietnam and Germany, it can be seen that Germany is the biggest trading partner of Vietnam inEurope and the largest importer of Vietnam’s exports to the EU. Although the trade between thetwo countries has not reached expectations, and the results are still inferior to the potential, theprospects for trade between the two countries are great and need to be further developed due to thefavorable context and the advantages of the free trade agreement between Vietnam and the EU.This paper analyzes the current state of trade relations between Vietnam and Germany, assessesthe advantages and disadvantages, and suggests policy implications for developing trade relationsbetween the two countries in the future.Keywords: Vietnam-Germany, trade relations, development prospects, policy implications.1. Introduction *process of economic transition but also supportsVietnam in the process of reforming the legalsystem within the framework of the GermanVietnamese Legal State Dialogue with about 70seminars, professional exchanges, and fieldtrips each year. In addition, Germany alsosupports Vietnam’s accession to internationalorganizations and promotes the signing of theVietnam-EU Free Trade Agreement. On theside of Vietnam, it has actively supportedGermany in terms of regional cooperation in theAsia-Pacific region and EU-ASEAN.In the commercial relations betweenVietnam and Germany, since 1990 the twocountries have signed many importantagreements providing the legal basis for longterm bilateral cooperation, such as theAgreement on Investment Promotion andProtection signed in Hanoi on April 3, 1993.The Agreement on Maritime Transport wassigned in 1993 and the Double TaxationAvoidance Agreement was signed in Hanoi onVietnam and Germany officially establisheddiplomatic relations on September 23, 1975.After 42 years from the date of theestablishment of official diplomatic relations,relations between the two countries in all fieldshave been constantly developing. It can be saidthat the German Federal Republic is nowVietnam’s largest partner in Europe. Vietnam,and the Federal Republic of Germany, are bothmember countries in the process of regionalintegration. Although comparisons between theEuropean Union (EU) and the ASEANcommunity are not adequate, the two sides havesimilarities in overall objectives, especially inthe economic field with the emergence of theASEAN Economic Community by the end of2015. Germany not only helps Vietnam in the_______*Tel.: 84-978875866.Email: tinhvinh@gmail.comhttps://doi.org/10.25073/2588-1108/vnueab.413470D.T. Tinh / VNU Journal of Science: Economics and Business, Vol. 33, No. 5E (2017) 70-75November 16, 1995. The two countries agreedto establish a strategic partnership in October2011 to boost closer cooperation in the future,especially in five key areas: strategic politicalcooperation, trade and investment, justice andlaw, development and protection of theenvironment, education, science, technology,culture and communication and society [3].Even today, Vietnam and Germany both havethe potential to develop trade and to the extentof adding large trade, trade relations betweenGermany and Vietnam has developed rapidlyand dynamically in the EU. Import-exportturnover between the two countries hasincreased annually. Germany is not onlyVietnam’s largest trading partner but also animportant transit gateway for Vietnamese goodsto other European countries. Germany is a largemarket, has sustainable development and anopen trade policy. As a member of the EU,Germany also applies the EU common tradepolicy for Vietnam. In addition, Vietnam hascreated conditions for the German Chamber ofCommerce and Industry to come into operation inVietnam with the objective of creating a bridgefor economic and trade cooperation between thetwo countries. Thus, Vietnam and Germany havea lot of prospects to fully exploit the potential forcooperation in developing trade relations betweenthe two countries in the future.2. Method of research- Method of collecting information: Dataand information on trade relations betweenVietnam and Germany were collected andsynthesized from legal documents, reports andofficially published data of the GeneralStatistics Office, Ministry of Trade and Industryin Vietnam and other documents related to thecooperativerelationshipbetweenthetwo countries.- Synthesis and processing of theinformation: All collected data and informationis classified and divided into an entity tosynthesize, build theoretical foundations andassess the actual situation of trade exchange71between the two countries Vietnam - Germanyas the basis for giving the most accurateassessment.- Descriptive statistics methodology, whichis intended for statistical analysis of data anddescriptive characteristics of data and collecteddata through export and import activities. Themethod of comparative analysis, clarification ofdifferences or comparison between years toassess the current status, is used as the basis forproposing solutions to develop trade betweenthe two countries in the future.3. Results of the current situation of traderelations between Vietnam - GermanyAfter 42 years of establishing diplomaticrelations, trade relations between Vietnam andGermany have been strengthened anddeveloped. Although the import-export turnoverwith Vietnam only accounts for a small part ofGermany’s ...