Vietnam firms advised to limit risks in foreign trade

HANOI: The trend of international economic integration has opened up many trade opportunities for the Vietnamese business community. However, there are also many scams that cause local firms to suffer heavy losses.

This was presented at a workshop “Prevention of disputes and fraud in international trade – experiences for Vietnamese businesses from the case of cashew nut containers” held here.

In March, the business community expressed concern regarding a case in which cashew nut containers had problems with shipping documents sent to Italy and Turkiye, meaning there was a risk the shipments would be lost.

With the desire to share experiences on the case with the business community as well as help improve their understanding of international commercial law, the Vietnam Chamber of Commerce and Industry (VCCI) in collaboration with the Industry and Trade Ministry organised the event. It also aimed to identify similar risks in commercial activities, thereby preventing disputes and fraud when implementing import-export transactions.

Dau Anh Tuan, head of VCCI’s legal department, said according to the Global Association of Anti-Fraud Professionals, every year, businesses globally are scammed and lose about 5% of their revenue. The average scam is worth about US$1.7mil (RM7.6mil).

In 2022 alone, up to 46% of global businesses said they were victims of fraud and economic crime.

In Vietnam, 52% of businesses have experienced fraud or economic crime in the two years before the survey, higher than the 46% rate in the Asia-Pacific region and 49% globally.

Meanwhile, Vietnamese businesses have not paid attention to anti-fraud measures. Also, there are few Vietnamese enterprises reporting to the management agency for fear of information being leaked to the public.

He hoped that experts, associations and the business community seriously consider this problem and find solutions to avoid such scams and minimise losses due to fraud.

Bach Khanh Nhut, vice-chairman of the Vietnam Cashew Association (Vinacas), spoke about the fraud of 76 containers of cashew exports to Italy and gave recommendations to associations and businesses in other economic sectors and fields.

He said in this case, Vietnamese businesses were overly trusting of brokerage companies.

During the Covid-19 pandemic, large orders made it easy for businesses to be negligent because they wanted to sell goods especially at a time when there were few transactions in the market. In addition, the payment method has risks.

He said, in international business, the role of a broker is very important, but businesses need to have an independent check on partners. This is why the role of the trade office in foreign countries is very important.

“Local firms need to be alert to unusual signs from partners although scammers often use very sophisticated tricks.

“They should use more secure payment methods and exchange information with colleagues to detect signs of fraud.

“It is necessary to report it quickly and ask for the help of industry associations when the incident occurs. At the same time, businesses need to be proactive and make efforts in solving their own cases,” he added. — Viet Nam News/ANN