OnPoint Consulting by Hau Pham

The recent warning from the Vietnam Pepper and Spice Association (VPSA) on pepper exports to Pakistan is not, in my view, mainly a “Pakistan story.”

It is a payment-risk story. Today, let’s look at one of the most important issues in export and cross-border trade: payment security. That distinction matters for Vietnamese exporters.

Vietnam’s Ministry of Industry and Trade has already warned that international trade fraud cases involving Vietnamese businesses have been increasing, with losses ranging from tens of thousands to millions of US dollars. The Vietnam Trade Office in Pakistan also described a 2024 case in which scammers used fake company identities and bank accounts, and warned Vietnamese firms to stop dealing with the suspected counterparty.

The useful lesson is not: “be afraid of exports.”

It is this: payment risk is usually created long before the payment date.

It starts when the parties agree on the payment method. It deepens when the contract is vague on documents, title, release conditions, default, or dispute handling. And it becomes expensive when the seller ships first and hopes the paperwork will somehow protect the money later. The 2022 Italian cashew case made the same point from another angle: once the documents and cargo move under the wrong structure, recovery becomes a race against time.

For Vietnamese exporters, the commercial agreement is therefore not only a sales document. It is part of the payment-security structure.

A good contract will not eliminate fraud. But a weak contract can make a bad situation much worse.

My own takeaway is simple: Do not discuss price as if it stands alone. Discuss price together with deposit, payment triggers, document control, and enforcement logic.

That is not legal perfectionism. Sellers should see it as an export-survival tool.

In principle for reputable foreign buyers — including German buyers in a much more rule-based market — complex payment structure should often not be controversial. They will be open to discuss and build that in contracts. Serious business also means a serious payment structure.

The question is not whether trust matters. The question is whether the contract still works when trust fails.

The same principle should also apply to protecting serious foreign buyers when they do business with Vietnamese companies: how do you ensure delivery security?

More importantly, partner verification is essential, before discussing a sales and purchase contract.

At OnPoint Consulting, we support both German and Vietnamese businesses in verifying partners in Germany and Vietnam as well as negotiating your commercial contracts. Reach out when you need that support.

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