Vietnam seeks new markets as crisis deepens

By Simon Falush and Sebastian Tong

LONDON (Reuters) - Vietnam is seeking to expand exports to the Middle East and other regions to reduce its dependence on the biggest developed markets such as the EU, a trade official told Reuters on Thursday.

Le Danh Vinh, vice minister for trade and industry, also said the government would introduce selective import tariffs to help narrow the trade deficit in the face of a global economic slowdown.

"We will reorient our export markets, moving away from (a focus on) exporting to the EU and other U.S."

"We will try to look for new markets in Asia, the Middle East, New Zealand and South American markets. We are going to diversify export markets, so as not to be too dependent on one or two markets," he said through an interpreter.

The United States, the European Union and Japan, together generate 61 percent of Vietnam's export revenues.

The government has projected Vietnam's exports in 2009 to grow by only 13 percent, less than half the rate of growth this year.

Vietnam's economy is set to grow 5 percent next year, the International Monetary Fund said, down from an estimated 6.5 percent in 2008, and off a robust 8.5 percent expansion last year.

The central bank has cut benchmark interest rates by 400 basis points since late October to 10 percent, reduced reserve ratio requirements for banks to free up cash and allowed the tightly managed currency more room to depreciate.

Vinh said the government would help domestic exporters by cutting bureaucratic costs, adding that it would actively pursue monetary and exchange rate policies to foster competitiveness.

"We will try to... minimize (government) fees and charges."

Vinh said the government is to invest in big infrastructure projects to boost domestic consumption and alleviate poverty.

Hanoi was also looking to curb imports to reduce its trade deficit, Vinh said.

"We restrict imports of consumer goods which can be produced in the country by using import and special consumption taxes," he said, adding that there were temporary measures in place on imports such as motor vehicles and tobacco.

Vinh was in London to meet British government officials for trade talks.

(Additional reporting by Katie Nguyen; Editing by Victoria Main)