The bilateral trade between Vietnam and Russia is expected to reach 10billion USD by 2020, following a Free Trade Agreement between Vietnamand the Eurasian Economic Union.

The Eurasian Economic Union (EEU) includes Russia, Belarus, Kazakhstan, Armenia, and Kyrgyzstan.

TheFinance Ministry said that with the signing of the FTA in May, Vietnamcan benefit from its commitment to elaborate import tax on some keyVietnamese export items, including seafood, processed fish, fruits, andrice.

It added that this can facilitate Vietnamese enterprises to promote the country's exports to Russia.

HaDuy Tung, Deputy Head of the ministry's International CooperationDepartment, told Hai Quan newspaper (Customs) that Russia has been oneof the world's major consumption markets, so this FTA can create greatopportunities for Vietnam.

The Chief Representative of theRussian Trade Office in Vietnam, Maxim Golikov, noted that during2005-09, the turnover of the bilateral trade between the two countrieswas 1.1 billion USD per year. This increased three times to around 3.5billion USD during 2010-14.

He added that the two-way trade will rapidly increase after the signing of the FTA.

NguyenTon Quyen, the vice chairman-cum-general secretary of Vietnam Timberand Forest Products Association (Vifores), pointed out that businesseshave much expectation from the Russian market as the country has beenthe third largest importer of Vietnam's wooden products, following theUnited States and European Union.

Quyen expressed his hope thatenterprises in this sector will exploit market opportunities,considering that the export turnover to Russia has been around 40-50million USD.

A representative of the Vietnam Association ofSeafood Exporters and Producers (VASEP) said seafood firms will enjoypreferential status in terms of tax norms. Agreements on the foodhygiene and sanitary and phytosanitary fields will be integrated andtransparently implemented in accordance with international norms.

Domestic seafood companies will be able to avoid complications in food hygiene, he added.

However,the signing will also create challenges for businesses, said Duong HongMinh, Deputy Head of the Ministry of Industry and Trade's EuropeanMarket Department.

According to Minh, local firms lack in information on markets as they have focused on markets in English-speaking countries.

Anotherchallenge especially for small and medium Vietnamese enterprises willbe to deal with the methods of payment. Russian firms often sendpayments via telegraphic transfer (T/T) instead of Letter of Credit. T/Tpayments are usually made when samples or small quantity shipments aretransported by air, with documents such as air waybills, commercialinvoices, and packing lists are sent along with shipments. This has beena barrier that dissuades local companies.

However, he said, Russian businesses have been believable, which causes less disputes.

Heobserved that enhancing the quality of agricultural, forestry, andseafood products has been a challenge for Vietnamese companies.

Hesuggested that relevant agencies should provide adequate information tobusinesses on regulations relating to product quality that areprevalent in markets, including those in the Eurasian Economic Union.

Theministry in cooperation with the Ministry of Agriculture and RuralDevelopment and Russian management agencies should resolve this issue.-VNA