Vietnam-Philippines Two-Way Trade

The President of the Philippines is on an official state visit to Hanoi during which he will discuss trade and investment between the two nations. Here’s how that trade and investment is shaping up.

The President of the Philippines, Ferdinand Marcos Jr., is on an official state visit to Hanoi. During his visit, the Filipino leader is slated to talk about trade and investment with key Vietnamese decision-makers.

Both members of the Association of Southeast Asian Nations (ASEAN), these two countries are parties to a number of multilateral trade agreements that have made trade between them cheaper and easier.

In particular, Vietnam has become extremely important to the Philippines’ food security, exporting over US$1.75 billion worth of rice to the country in 2023.

In this light, here’s how trade and investment is shaping up between these two Southeast Asian neighbors.

Trade relations between the Philippines and Vietnam

Both members of ASEAN trade between the Philippines and Vietnam is covered by several free trade agreements. These include:

• ASEAN Trade in Goods Agreement (ATIGA)
• ASEAN-China Free Trade Area
• ASEAN-Japan Comprehensive Economic Partnership
• ASEAN-Korea Free Trade Area
• ASEAN-Australia-New Zealand Free Trade Area
• ASEAN-India Free Trade Area
• ASEAN-Hong Kong, China Free Trade Area (AHKFTA)
• Regional Comprehensive Economic Partnership.

See also: Vietnam’s Free Trade Agreements – Opportunities for Your Business

Philippines FDI projects in Vietnam

As of the end of 2022, firms from the Philippines had registered 88 projects in Vietnam to the tune of US$605.99 million since Vietnam began keeping records.

One of the biggest investors in Vietnam from the Philippines is the Jollibee Foods Corporation. Jollibee is most well known for its fried chicken and rice fast-food restaurants of which it has around 150 stores in Vietnam.

That said, the company is also the majority shareholder of Vietnam’s Highlands Coffee chain. There were over 500 Highlands coffee outlets in Vietnam in 2022 with around 50 in the Philippines.

Exports the Philippines to Vietnam

In 2023, the Philippines’ key exports to Vietnam were: computers, electrical products, spare parts and components thereof; machines, equipment, tools and instruments; and

other base metals. Collectively these three items accounted for just over US$2 billion worth of exports to Vietnam out of a total of US$2.65 billion.

Philippines’s exports to Vietnam, 2023

Source: Vietnam General Department of Customs

Exports Vietnam to the Philippines

In 2023, Vietnam’s biggest exports to the Philippines were: rice; clinker, and cement; and machines, equipment, tools, and instruments. Collectively exports of these items accounted for US$2.46 billion worth of exports to the Philippines. This was out of total exports of US$1.49 billion.

Vietnam’s exports to the Philippines, 2023

Source: Vietnam General Department of Customs

Philippines-Vietnam trade moving forward

With two-way trade at just over US$7.8 billion last year, the trading relationship between Vietnam and the Philippines has become incredibly important for both countries. As the ASEAN trading bloc becomes more heavily integrated and supply chains become increasingly more diversified, this two-way trade volume is likely to become even greater.

To find out more about building regional supply chains in Southeast Asia contact the business advisory experts at Dezan Shira and Associates.

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