Domestic cinnamon trading and production businesses have been effectively leveraging the benefits from free trade agreements (FTAs) to boost exports. However, many enterprises still struggle without a clear strategic direction for sustainable development. Vietnam Economic News’ Khanh An spoke with Ngo Chung Khanh, Deputy Director of the Ministry of Industry and Trade’s Multilateral Trade Policy Department about this.

Could you tell us about Vietnamese cinnamon enterprises’ utilization of FTAs, particularly the EU-Vietnam Free Trade Agreement (EVFTA), to promote exports?

Ngo Chung Khanh, Deputy Director of the Ministry of Industry and Trade’s Multilateral Trade Policy Department

Vietnamese cinnamon brands and products have reached discerning markets, such as Europe, Canada, and the UK. This is a positive sign. However, in reality, Vietnam still mainly exports raw products, yielding minimal export value, and thus, profits earned by farmers remain limited. Challenges faced by cinnamon farmers include capital for production, trading, including export; technology; market information and orders; and export markets’ regulations and policies.

For sustainable exports, businesses and cinnamon farmers need to focus on branding development, which requires long-term efforts.

The Government has tasked the Ministry of Industry and Trade to work with ministries, sectors and localities in building an FTA leverage ecosystem. Could you elaborate on this?

By participating in that ecosystem, cinnamon farming households will receive support in securing loans from financial institutions, guidance on cultivation techniques to meet export standards, guaranteed sales under contracts with businesses within the ecosystem, and assistance in resolving issues during the cultivation process.

Businesses involved in production, processing and export will benefit from credit support, assistance in access to the Government’s incentives, market information, customer connections and contract facilitation. They will also be helped in confronting challenges.

Meanwhile, banks will benefit from effective credit disbursement, meeting credit growth targets while ensuring financial safety; diversify their capital borrowers; expand relationships with local and central organizations, and receive assistance for resolving problems arising during the business process.

Vietnamese cinnamon brands and products have reached discerning markets, such as Europe, Canada, and the UK

What criteria should be met to join the ecosystem? What should be done to meet those criteria?

Building this ecosystem is not a simple task, as it involves all stakeholders mentioned earlier. The key criteria for participation are that farmers and businesses share a common mindset and goal.

The FTA ecosystem for each sector is tailored to real conditions, connecting businesses and stakeholders that share the same vision for long-term, green, clean, and sustainable cooperation.

We aim for this ecosystem not only to operate in Vietnam but also to extend to consumers in markets, to which Vietnam is an FTA signatory. Through the ecosystem, foreign businesses and consumers can implement origin traceability or track the entire processes from cultivation, production, and export.

What solutions does the Ministry of Industry and Trade have to support businesses and associations in building this FTA ecosystem?

We will choose leather and footwear, textile-garment, fisheries, coffee, and cinnamon sectors to pilot the FTA ecosystem model. The Ministry held seminars and talks to gather opinions from ministries, sectors and localities, build a project for submission to the Government for approval.

If it is approved, the ecosystem project is expected to begin pilot operations in September 2025. It will need collaboration from ministries, local governments, and businesses./.