EVFTA EXPANDED EXPORTING FOR VIETNAM'S TUNA
Date post :18/06/2020 - 11:15 AM
When EVFTA takes effect, Vietnam's tuna products will have tax advantages compared to countries like Thailand or China, Vietnam's major competitors holding large export market share in the EU but have not yet signed FTA with EU.
Vietnam Association of Seafood Exporters and Producers (VASEP) said that the Vietnam Free Trade Agreement - 28 EU member countries (EVFTA) are a new-generation trade agreement, forecast to bring many opportunities. opportunity for the Vietnam tuna industry in exploring markets.
According to statistics of Vietnam Customs, the EU has been the second-largest tuna export market of Vietnam in the past 10 years. From 2015, after Vietnam and the EU officially concluded negotiations and on February 1, 2016, the agreement was published, Vietnam's tuna exports to the EU grew continuously.
Currently, Vietnam has exported mainly tenderloin / frozen tuna fillets and canned tuna to the EU market in the past 10 years. Before 2014, Vietnam's tuna fillets / frozen tuna exports to the EU continued to grow. However, after that, there was a continuous downward trend for 2 years and increased again in 2017. Canned tuna products tended to increase continuously in the period before 2014 but then continued to decrease continuously.
Germany, Italy, and Spain are the three largest tuna import markets of Vietnam in the EU. While Germany imports a lot of canned tuna products from Vietnam. Italy and Spain import a lot of fresh and frozen tuna products.
Tuna products of Vietnam mainly compete with similar products from Ecuador, Philippines, Indonesia, Thailand, and China. Vietnam is difficult to compete with other countries because of their catches, scale, and tuna production capacity.
Besides, Vietnam is also difficult to compete with the Philippines and Ecuador because they enjoy preferential tariffs, while Vietnam does not enjoy preferential treatment. Vietnam's seafood industry has been considered to reach the "maturity" level, ie, the group of items with relatively high export value to the EU over the years, so from January 1, 2014, Vietnam Nam did not get the discount anymore. Therefore, Vietnam's tuna products are subject to a tax rate higher than 20.5%. This has reduced the competitiveness of Vietnam's tuna products.
Under the commitment in EVFTA, the EU will eliminate tariffs on fresh and frozen tuna products (except for tenderloin / frozen tuna fillets code HS0304) as soon as the agreement comes into effect. For frozen tuna loin filet/fillet code HS030487, the EU will eliminate tariffs for Vietnam on a 3-year schedule, from the base rate of 18%, right after the agreement comes into effect.
With steamed tenderloin/filet products (raw materials for the production of canned tuna), the EU will eliminate tariffs for Vietnam on a seven-year roadmap, from a base tariff of 24%. Particularly for canned tuna processed products (such as canned tuna in canned oil, canned bags, fish products in the canned tuna family ...), the EU will exempt Vietnam from a tax rate of 11,500 tons. /year.
Thus, VASEP thinks that in the long run when EVFTA takes effect, it will be an advantage for Vietnamese tuna processing and exporting enterprises. However, in the short term, businesses will face many difficulties. Because this FTA includes a comprehensive and strong chapter on trade and sustainable development, covering the labor and environmental issues involved in trade relations between the EU and Vietnam.
Source: Tai Chinh Plus