MINISTRY OF EDUCATION

FOREIGN TRADE UNIVERSITY HCMC

INTERNATIONAL MARKETING
Analysis of Macroenvironment in North Europe

Lecturer: Nguyễn Thị Thu Thảo

Class: K56CLC3

Lê Phương Đông 1701015107

Lương Tuệ Minh Khuê 1701015356
Nguyễn Phước Kỳ Duyên 1701015149
Châu Ngọc Hoa Thy 1601015505
Nguyễn Thị Phương Trúc 1601015552

Ho Chi Minh City, 21th August 2019

 Table of Content
1. Macro-environment analysis of Nordic region ............................................................................1
2. SWOT analysis of Vietnam and Nordic markets .........................................................................2
3. Prospect of exporting soft dried fruit to Nordic markets .............................................................3
REFERENCES ................................................................................................................................4
APPENDIX ......................................................................................................................................5

Table of Figures

Figure 1a. Exchange rate of NOK to VND (18/08/2019) ................................................................... 5

Figure 1b. Exchange rate of SEK to VND (18/08/2019) .................................................................... 5
Figure 2a. Vietnam export to Sweden (2017) ................................................................................ 6
Figure 2b. Vietnam export of Edible fruit and nuts; peel of citrus fruits or melons to Sweden
(2008 – 2017) ................................................................................................................................... 6
Figure 3a. Vietnam export to Norway (2017) ...................................................................................... 7
Figure 3b. Vietnam export of Edible fruit and nuts; peel of citrus fruits or melons to Norway
(2008 – 2017)7
Figure 4. Technical measures applied to agriculture product ............................................................. 8
1. Macro-environment analysis of Nordic region

Northern Europe extends from the Northern European Plain to the Arctic Circle. The countries
include Norway, Sweden, Finland, Denmark, Estonia, and Iceland. These countries have
relatively small populations, only about 28 million inhabitants. Despite such small population,
Nordic region enjoys considerable prosperity and some of the world’s highest gross domestic
product (GDP) per capita’s. We will analyze the macro-environment of this region via 2
countries: Norway and Sweden. Looking beyond the standard economic indicators, both
countries perform at the top-European level.

Norway has a population of more than 5.4 million people and GDP per capita around 76,000
USD in 2019. Its currency is Norwegian Krona (NOK – Figure 1a). Sweden, in 2019, has the
population double that of Norway (more than 10 million people). Its official currency is Swedish
Krona (SEK – Figure 1b). Sweden has seen continued general growth in GDP in recent years,
however during the period 2009–2015 around half of the Swedish regions saw a negative gross
regional product (GRP) growth, signaling an uneven spatial distribution of economic
development. Both countries are transparent, highly developed, sophisticated and diversified
markets with few barriers to entry.

Norway and Sweden have very high internet penetration rates and thus have thriving e-
commerce economies. These countries have their own language, which are Norwegian and
Swedish, but are still top the world in English language skills. Most Norwegian are Lutheran
(71.5%), whereas most Swedish are Christian (69.9%). Sweden and Norway have one of the
world’s highest life expectancies and one of the lowest birth rates. There is an extensive social
welfare system, which are paid for by taxation.

The Nordic region has a political dimension in the joint official bodies called the Nordic Council
and the Nordic Council of Ministers. In this context, several aspects of the common market as in
the EU have been implemented decades before the EU implemented them. Intra-Nordic trade is
not covered by the CISG, but by local law. In the EU, the Northern Dimension refers to external
and cross-border policies covering the Nordic countries, the Baltic countries and Russia. The
political cooperation between the Nordic Countries has not led to a common policy or an
agreement on the countries' memberships in the EU, Eurozone and NATO. Norway and Iceland
are the only Nordic countries not members of the EU, while Finland and Sweden are the only
Nordic countries not members of NATO. As a result, only Sweden is a member of EU - Vietnam
Free Trade Agreement (EVFTA) has taken effect in 2019, whereas Norway is expected to sign
another FTA called European Free Trade Association (EFTA) with Vietnam in the near future.

In 2017, Vietnam’s export to Sweden is more than 1.08 billion USD (UN Comtrade). Major
products are electrical machinery and equipment (60.5%), industrial machinery (8.41%),
furniture (5.23%), footwear (5.08%), and agriculture products (around 4%) (Figure 2a). Among
agricultural products, edible fruits and nuts experienced an upward trend in export value. In

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2008, this category amounted to only 2 million USD, but skyrocketed over the period of ten
years and reach $12 million USD in 2017 (UN Comtrade) (Figure 2b).

In 2017, Vietnam’s export to Norway is more 1 billion USD (UN Comtrade). The main export
products of Vietnam to Norway have a stable growth rate such as footwear (24,69%), electrical
machinery and equipment (10,28%), apparel, not knit (9,67%), ship (9,55%), industrial
machinery (5,17%), articles of iron and steel (4,16%), and agriculture products (around 5,16%)
(Figure 3a). Among agricultural products, edible fruits and nuts experienced an upward trend in
export value. In 2008, this category amounted to only 6 million USD, after many ups and downs,
this category also has a steady growth and reaches 11.8 million USD in 2017 (UN Comtrade)
(Figure 3b). Absolutely Norway is expected as a potential market for Vietnam with fruit, nut and
dry fruit.

2. SWOT analysis of Vietnam and Nordic markets

Our group uses SWOT analysis to evaluate the potential of exporting soft dried fruit to Nordic
market. Firstly, there are opportunities existing in this region. The high GDP per capita implies
that consumers have large amount of disposable income, thus consumers are willing to pay for
their favorite fruits and vegetables available in the off season and far from the production areas.
The legal environment in Nordic countries is transparent and well-regulated, reduces the risks of
foreign business. Infrastructures for transportation, communication, water, electricity are
sufficiently provided, so that the distribution of goods would be less costly in terms of time and
money. Moreover, developed countries’ residences are more and more concerning about living a
healthy life, but fresh tropical fruits are offered at high price because of high costs of transport,
preservation, quarantine and irradiation treatment, which is the reason for our group to
recommend exporting soft dried fruits – an underserved product – to Nordic markets.

However, threat is that Nordic countries have open and therefore highly competitive markets.
This means Vietnamese companies face strong competition from domestic and third-country
suppliers. There are high requirements and very strict regulations on the responsibility of food
exporters, so Vietnamese firms should have strict health policies, good quality products,
competitive prices, and actively penetrates into the markets in order to succeed. Besides, Nordic
countries have high cost of living, with expensive labor and individual tax rates, which are
among the highest worldwide. In Sweden, a valued-added tax (VAT) rate of 25 percent applies
to the import or sale of most products, which might offset the price advantage of Vietnamese
firms. Another challenge is that the Swedish cultural philosophy of ‘jantelagen’, or “You are not
better than anyone else”, still eschews overt self-promotion and achievement as inappropriate.
Vietnamese firms should be aware of this when branding their product in this market. The final
threat is from competitors from nearer tropical countries in South America such as Peru, Costa
Rica, Brazil, and Chile, which have closer geographic location to Nordic countries in comparison
with Vietnam, thus might have an advantage over Vietnam in transportation cost.

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About our strengths, Vietnam’s fruit industry has great potential in terms of both production and
export, since Vietnam is a tropical country with favorable land and climate conditions for
growing many varieties of fruits. In terms of human resource, Vietnam labor force is abundant
and cheap thanks to golden population structure with 69.3% in the age 15-64. Vietnam labors are
also equipped with compatible skills and abilities to operate the advanced manufacturing
process. In addition, government has good support policies in agriculture and trade. Vietnam and
the EU have recently finished negotiations of an EU – Vietnam Free Trade Agreement
(EVFTA), which is expected to be signed in 2018 and come into force in 2019. The EVFTA
therefore represents an excellent opportunity for Vietnam to compete with FTA partners of the
EU, and to gain an advantage over the other big fruit exporters that do not have an FTA with the
EU – such as Brazil, the Philippines, and Indonesia.

Nevertheless, it does not mean that we do not have weaknesses. The first problem is Vietnamese
fruit producers are still small and scattered. Most fruit producers in Vietnam are households and
small enterprises scattered in various areas. The relatively weak capacity of the processed fruit
manufacturing sector means that the main types of processed fruits in Vietnam are dried and
frozen, which implies that processed product manufacturing is still limited as it requires more
advanced processing techniques. Last but not least, Vietnamese companies are not good at doing
business and building trademarks, building long-term relationships with foreign customers.

3. Prospect of exporting soft dried fruit to Nordic markets

Our group chooses Norway and Sweden as our first markets to enter Nordic region. Our product
is Vietnam’s soft dried tropical fruits (mangos, bananas, pitaya). Drying preserves food by
reducing the water content below the level needed for microorganisms to survive. Fruits and
vegetables are peeled and prepared, removing inedible portions and making even slices to
facilitate uniform drying. Next, in the case of most products, preservatives are applied. Dried
fruits usually have a shelf life longer than that of fresh fruit and are easier to transport and
preserve. The recommended strategy to enter the market is cost leadership, combined with
product differentiation. Our targeted customers are people aged from 16 to 35, living in big cities
such as Stockholm, Gothenburg, Malmo, Oslo, and Bergen. The positioning of our product is a
supplementary food in daily diet. We want to assure that our customers can absorb enough daily
fruits in a fast, convenient way with reasonable price. Low price comes from abundant sources of
fruits and labor, economy of scale effect in production and transportation process. Our unique
selling point are high-standard source of fruits, high-qualified processing technology helps
preserving the origin nutrition and deliciousness, longer preservation time, and fast and
convenient snack. Product can be packed by single fruit, mixed fruits. We suggest evaluating the
potential for distributors to cover the entire Nordic region, especially big cities of Sweden and
Norway such as Stockholm, Gothenburg, Malmo, Oslo, Bergen. The channels of distributing
focus on convenience stores and supermarkets. We want to establish a long-term relationship
with distributors by direct export, so visits are important since Nordic partners want first-hand
assurance of a partner’s reliability and commitment.

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REFERENCES

Delegation of the European Union to Vietnam, GUIDE TO THE EU-VIETNAM TRADE AND
INVESTMENT AGREEMENTS, (2016)

Export Government, Sweden Country Commercial Guild (2019), retrieved from

https://www.export.gov/ccg

OEC, Norway (NOR) Exports, Imports, and Trade Partners (2019), retrieved from
https://oec.world/en/profile/country/nor/

OEC, Sweden (SWE) Exports, Imports, and Trade Partners (2019), retrieved from
https://oec.world/en/profile/country/swe/

Trading Economics, European Union GDP Per Capita, retrieved from

https://tradingeconomics.com/european-union/gdp-per-capita

Trading Economics, NOKVND (2019), retrieved from https://tradingeconomics.com/nokvnd:cur

Trading Economics, SEKVND (2019), retrieved from https://tradingeconomics.com/sekvnd:cur

TRAINS, Non-Tariff Measures (NTMs) based on official regulations (2019), retrieved from
https://trains.unctad.org/

Trung tam WTO, Vietnamese Fruits overcome barriers to accessing EU market, takes advantage
of opportunities brought under the EVFTA, (2019)

UN Comtrade Database, Norway (2019), retrieved from https://comtrade.un.org/data/

UN Comtrade Database, Sweden (2019), retrieved from https://comtrade.un.org/data/

Worldbank, Norway, retrieved from http://datatopics.worldbank.org/world-development-

indicators/

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 APPENDIX

Figure 1a. Exchange rate of NOK to VND (18/08/2019)

Source: TradingView

Figure 1b. Exchange rate of SEK to VND (18/08/2019)

Source: TradingView

5
Figure 2a. Vietnam export to Sweden (2017)

Source: UN Comtrade

Figure 2b. Vietnam export of Edible fruit and nuts; peel of citrus fruits or melons to Sweden
(2008 – 2017)

Source: UN Comtrade

6
Figure 3a. Vietnam export to Norway (2017)

Source: UN Comtrade

Figure 3b. Vietnam export of Edible fruit and nuts; peel of citrus fruits or melons to Norway
(2008 – 2017)

Source: UN Comtrade

7
Figure 4. Technical measures applied to agriculture product

Source: UNCTAD database