Strong Economic Tie
The Institute for International Trade (IIT) of the Korea International Trade Association (KITA) said on March 20 that the volume of trade between South Korea and Vietnam is estimated to exceed US$100 billion in 2020 and Vietnam is expected to become the second-largest export destination for South Korea that year. At present, it is the United States that is the second-largest export destination for South Korea.
Vietnam was the sixth-largest export destination for South Korea four years ago. Then, the volume of trade between South Korea and Vietnam has soared since their FTA became effective in late 2015, and Vietnam has become the third-largest export destination for South Korea last year.
These days, exports from South Korea to Vietnam are showing a rapid increase along with the ratio of South Korean products in the Vietnamese import market. Specifically, the ratio rose from 8.5% to a record high of 22.1% from 2007 to last year. South Korean companies such as Samsung and LG built production lines in Vietnam, increasing the imports of smartphone components and so on.
The KITA advised that South Korea needs to seek co-prosperity with Vietnam and find ways to contribute to the growth of the Vietnamese economy with the two countries’ economic ties increasingly strengthening.