Tarriff exemptions for Chinese, ASEAN goods

Tuesday, Nov 01, 2016 09:03

Officials check fruit imported from China at the Tan Thanh border gate in northern Lang Son Province. — VNA/VNS Photo Dinh Hue
HA NOI (Biz Hub) — The zero per cent tariff under the ASEAN-China Free Trade Agreement (ACFTA) will bring more goods from ASEAN and China to Viet Nam, especially Chinese fruits.

This will create more competition for local products, according to experts. The Government has issued a decree on special preferential tariffs for ASEAN and Chinese products for the 2016-18 period according to commitments under the ACFTA.

Under the decree, hundreds of goods from ASEAN and China will enjoy zero per cent import tax to Viet Nam. The goods include vegetables, fruits, processed or preserved fish and other kinds of seafood, as well as cacao and cacao products, cereal, flour and meat.

According to the commitments at ACFTA, Viet Nam will abolish tax or reduce it to zero per cent for 90 per cent of existing tariff lines by the end of 2018, while the remaining 10 per cent of tariff lines will see it reduced by 2020.

A representative from the Viet Nam Chamber of Commerce and Industry's WTO Support Centre said the reduction of import tariffs for ASEAN and Chinese goods would create strict competition between ASEAN, Chinese goods and local products.

General Statistics Office (GSO) statistics showed that in the first nine months of this year, Viet Nam had the highest import of goods from China, with total import value at US$36 billion.

Its trade deficit with China reached $21.3 billion, Nguoi Lao Dong (The Labourer) newspaper reported.

Local enterprises imported from China seafood valued at $45.3 million, vegetables and fruit at $146.9 million, fabrics at $3.93 billion and material for textile, garments, leather and footwear industries at $1.38 billion, as well as computer and electronic products valued at $4.1 billion, machine and equipment at $6.5 billion and steel at $3.2 billion.

Nguyen The Bao, director of Suoi Lon Agricultural, Service, Trade and Tourism Co-operative in southern Dong Nai Province, said mango growers studied supply at home and also in neighbouring countries to make plans accordingly on production, trading and competition.

Depending on the prevailing situation, Vietnamese mangos were exported to Thailand, Cambodia and vice versa. Meanwhile, after many years of exporting mangos from Viet Nam to China, the neighbouring country had begun exporting its mangos to Viet Nam to compete with local products.

Nguyen Cong Thua, chairman and general director of Anh Dao Agricultural Service Co-operative in the central highlands Lam Dong Province, said demand for fruit in the home market had increased, therefore there were times the market lacked supply of fruits and their import surged.

As a result, in the future, local farmers would face strict competition from imported fruit products because of their small and medium production scales with high production cost, while China's producers had large production scale with lower production cost, he said.

Meanwhile, Viet Nam did not have many technical barriers for imported fruit and lacked close control for quality and food safety, which was disadvantageous for local fruit producers while competing with imported fruits, he said.

Seafood is also expected to face similar competition when the import tax reduces to zero per cent under the ACFTA. —VNS

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