Asian Agribusiness Consulting

Vissan imports breeders to improve productivity, traceability

Viet Nam Meat Industries JSC (Vissan) brought in 220 GGP from the US which the company said will result in better productivity and lower cost, as well as allow traceability in Vissan’s closed production chain.

Luu Ngoc Giao, Director of Vissan’s swine production farm, said that “importing breeders is an important part in our strategy of developing the productivity and quality of the breeding herd and completes the company’s 3F (Feed-Farm-Food) traceability program.”

Vissan expects to start selling commercial pigs from these breeders in 10 months.

MrGiao said “the price of traceable pork is expected to be lower than the current price”.

The GGPs, which arrived in September, will be stocked in Vissan’s breeding farm in Binh Duong province. Occupying 8.6 ha, the farm, runs a closed farming system and uses the latest technologies in climate and ventilation control, biogas, and waste treatment, allowing it to comply with national farming standards. The farm currently has 1200 sows producing some 26,000 fnishing pigs annually.

The batch consists of Duroc, Landrace and Yorkshire breeds, each animal averaging 50-55kg, which were selected from five breeding farms of Clayton Agri-Marketing, said Vissan CEO Van Duc Muoi. This is the third time the company imported breeding pigs from Clayton Agri-Marketing in 15 years.

Further expension

According to Vissan’s CEO Van Duc Muoi, in its development strategy for 2015-2020, the company expects to be more active in terms of input supply to ensure stable production, enabling a safe food supply chain for the domestic market and exports.

“We are planning for a production of 300,000 finisher swine by 2020. Of which the company will manage 30%, while local farmers compensate the rest,” said MrMuoi.

Vissan, one of the leading food processing companies in the Vietnam, currently holds a 24% share in the market for fresh meat and has the largest safe food supply chain with 445 VietGAP certified meat stalls across the country. The leading pork supplier in Vietnam is also planning to build a feed facility, targeting the domestic and regional hog market.

Source:www.asian-agribiz.com

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Ministry encourages focus on agricultural machinery

Automation and mechanisation in rice and vegetable production in the Mekong Delta is expected to sharply reduce losses and increase value, the Agriculture and Rural Development Ministry has said.

The losses in rice production stand at 5-6 percent (3 million tonnes a year or 760 million USD), according to the ministry’s Department for Agro-Forestry-Fisheries Product Processing and Salt Production.

“If the proportion falls to around 3 percent, farmers’ incomes could rise to 1 million VND (45 USD) per hectare,” a representative of the department said.

Automation and mechanisation in rice planting and harvesting remains low.

The Mekong Delta has more than 5,500 harvesters being used on 40 percent of farmland, while rice-planting machines cover only 30 percent.

Automation and mechanisation in vegetable production is much lower than in rice production.

In general, the Mekong Delta has 1.6-horse power per hectare, while the figure in Thailand is four, China eight and the Republic of Korea 10.

“Automation and mechanisation in agricultural production will increase labour productivity, reduce costs and increase competitiveness for farmers,” Dr. Vo Hung Dung, said Director of the Vietnam Chamber of Commerce and Industry’s Can Tho branch.

“The potential for development of automation and mechanisation in Vietnam’s agricultural production is huge,” he added.

Most agricultural machines are based on production of small workshops with outdated technologies, design and post-sale services.

From 2004 to 2008, the Government allowed provincial authorities to subsidies the interest rate for farmers who bought machines for agricultural production.

After five years of the programme, tens of thousands of agri-motors and tractors are now in use.

Since 2009, the Prime Minister has released a series of decisions to subsidise interest rates for farmers to buy machines equipment, and material for agricultural and fisheries production as well as house construction in rural areas.

The Government and the Ministry of Agriculture and Rural Development have developed strategies to promote investment for machine automation in agricultural production with preferential policies on tax, credit and land.

Source: http://en.vietnamplus.vn/ministry-encourages-focus-on-agricultural-machinery/102479.vnp

EU beef imports to Vietnam recover

The European Union’s beef imports to Vietnam should recover as mad cow disease gets under control in Europe and the potential market in Vietnam lures imports with high demand and zero import tariff.

The European Union’s beef imports to Vietnam should recover as mad cow disease gets under control in Europe and the potential market in Vietnam lures imports with high demand and zero import tariff. — Photo cand.com.vn.

The Ministry of Agriculture and Rural Development’s National Agro, Forestry, Fisheries Quality Assurance Department (Nafiqad) said Vietnam has granted import licence for hundreds of factories in the EU to ship beef from the EU to Vietnam.

From November 2-4, 42 enterprises from EU countries visited Vietnam to study the domestic food market, the ministry said. Those enterprises came to supermarkets to contact directly with local customers for get information about demand and eating habit of the local people. They also had 500 meetings with domestic enterprises to find cooperation and investment opportunities.

The EU enterprises expect to promote their exports to Vietnam in the future, especially after the Vietnam – EU Free Trade Agreement comes into effect with zero tariff for many kinds of import and export goods.

This year, many cattle producing countries in the EU controlled completely mad cow disease--such as Belgium, France, the Netherlands, Germany and Italy--so the US and North American and Asian countries have opened their markets for beef imported from the EU. Vietnam has also given import licences for French factories to ship beef to Vietnam since May 2015.

So far, 158 French enterprises have received permission to sell their beef to Vietnam, and one third of them having slaughter plants. Hundreds of factories from Spain, Belgium, Italy, Poland and Poturgal have had qualified beef products to import to Vietnam.

Doan Ngoc Tho, director of Ho Chi Minh City-based THO Trade and Service Co Ltd, said beef from the US, Australia and the EU has reached highest quality standard in the world.

Restaurants and hotels in Vietnam have still had high demand on importing beef, he said.

Thơ was quoted by cand.com.vn online newspaper saying “I think control of mad cow disease in the EU and the effectiveness of the Vietnam – EU FTA will make beef a much more popular import than pork and chicken.”

Currently, imported frozen beef from the EU and the US to Vietnam has been taxed with a high tariff of 14%-30%. Beef is a hot product at supermarkets, restaurants and hotels with high retail price at between VND300,000-600,000 per kilo.

Veviba - a food company with a national and international presence located in Bastogne in the province of Luxembourg, has not exported its beef to Vietnam. Instead, it has shipped its beef to Greece and the Middle Eastern countries, said Sandrine Guillaume, a representive of Veviba, one of the 42 EU enterprises visiting Vietnam between November 2-4.

After studying Vietnam’s market, Guillaume said her group has planned to export beef to Vietnam in the future because the Vietnamese people pay attention to clean food and Veviba has produced beef under quality management process.

The ministry said Vietnam imported 1,720 tonnes of beef from the Europe in 2014, 70 times higher than the imports in 2012. The beef imports from Europe continued growing by 11,000 tonnes in 2015 against 2014 and by 15% in the first nine months of this year.

So far, 200 exporters in the EU have been granted licences to export their beef to Vietnam, it said.

Source:  http://customsnews.vn/eu-beef-imports-to-vietnam-recover-1664.html

Vietnam’s goods need to “upstream” into ASEAN market

The ASEAN market is appreciated as the third largest export market of Vietnam after USA and EU, but Vietnam’s exports into ASEAN markets are still modest. In order to “upstream” into the ASEAN market especially to the ASEAN Economic Community (AEC), managers as well as the enterprises need to make more effort.

Vietnamese enterprises participated in the fair area in Cambodia

Gradually have position

According to the Ministry of Industry and Trade, in the number of commodities which are exported to ASEAN, there are 2 commodities which have many more advantages, they are garments and fertilizer. The competitive pressures of the Textile sector in this market are not too big because the competitors are Thailand, Indonesia, and Malaysia where there are mainly processing products and have not yet developed a great world trademark. However, in order to make use of the advantage, enterprises will have to overcome the great difficulty which is the origin of the raw materials. For the Fertilizer sector, in the ASEAN region, Cambodia, Laos, Myanmar, and Thailand have huge demand but the production is not enough for consumption and they must import with huge quantities. Especially, Cambodia and Myanmar have to import up to 90% of the domestic demand and the fertilizer import duty was 0%.

In 10 years since joining the ASEAN market, from the modest figure $US1 billion (1995), Vietnam’s export turnover to this market has increased to $US18.3 billion with the average growth rate of 17.1%. Before 2010, Vietnamese enterprises mainly exported 2 main commodity groups to ASEAN - crude oil and rice (accounting for over 50% of total turnover).

Currently, commodities exported to ASEAN are more diverse, besides crude oil and rice such as: Telephone mobile phone and parts; computer and electrical products and spare parts; Steels and Iron; machinery and equipment, tools and instruments; garment products, foot-wear, fishery products, coffee, rubber, etc. It shows that enterprises have interest in the ASEAN markets.

Enterprises began to put the “bricks” to build the foundation for export growth to ASEAN in many ways such as: participate in trade fairs, trade promotion organizations or look for the partners by themselves. There are many Vietnamese brands which are gradually becoming familiar with consumers in the region such as: Nhon Hoa Scale, Thien Long ball-pen, Bidrico or Cholimex, etc. For example in the Myanmar market, there are some Vietnamese enterprises which have a good position such as: Dien Quang Lamp Joint Stock Company, Bibica JSC, Hoa Phat JSC, etc. In the Thailand market, ceramics products, electricity and cable, confectionery, garment products have better market entry.

Over a long time, the Quang Vinh Ceramic and Export Handicraft Company (Hanoi) has only been interested in large export markets such as USA and EU, but in the recent 5 years, it has been interested in the ASEAN potential markets. Laos is the first country which Quang Vinh Ceramic and Export Handicraft Company was interested in exporting its product. According to Ms. Ha Thi Vinh, the Director of the Quang Vinh Ceramic and Export Handicraft Company realized that although the Laos population is still modest there is a potential market in line with the products which are made by the company. Currently, the ceramic products of the company are sold in Laos, from Vientian to Luang Prabang.

“Uncertain” foundation

Although a number of Vietnamese enterprises have taken the quite comprehensive step to exploit the ASEAN markets by investing directly which actively develops value chains in the region and receive opportunities from the AEC, and transport goods and services to enter the ASEAN, but it is still ineffective. The evidence has shown that in the last 5-year trade relations with ASEAN countries, Vietnam still stays in trade deficit which has reached $US 6 billion in 2010 (accounting for 57%). The balance-of-trade deficit was $US 4 billion in 2014, equal to 20.3%. Exports in 2015 were lower than in 2014, the turnover was estimated at $US 20 billion, the trade deficit rose to over $US 5 billion and the trade deficit of over 30%.

In fact, Vietnam’s exports to ASEAN in the first 10 months of 2016 have shown signs of decline. Meanwhile, Vietnam’s exports to China have increased by 23.9%, to the USA market increased by 15%, the EU market has increased by 7.4%, and export to ASEAN markets has dropped by 7.6% compared to the same period last year. In 10 ASEAN countries, there are 6 countries which have reduced importing goods from Vietnam. Vietnam’s export to 3 countries with growth are Myanmar (21.1%), Philippines (13.8%) and Thailand (11.6%). The causes as explained by the Ministry of Industry and Trade are due to the reduction of crude oil export in volume and value.

Mr.Do Quoc Hung the Deputy Director of the Asia-Pacific market Department (the Ministry of Industry and Trade) added that, the export foundation of Vietnamese enterprises to ASEAN is “uncertain”. Although the AEC was built at the end of 2015 there have many big challenges with Vietnam’s export products. The rate of tariff elimination in ASEAN-6 countries is 98% of which Vietnam, Lao, and Myanmar is 91% and is striving to reach 98% by 2018. Moreover, when the ASEAN countries implement tariff elimination with Vietnam’s export products, a technical standard system will be built immediately to protect the domestic markets, and restrict Vietnam’s exports.

Vietnam’s exports to ASEAN market are: garment products, footwear, fertilizer, agricultural products, foodstuff, and construction materials but most enterprises sell to importers. Although there are a number of commodities which have great demand in the market but Vietnam’s enterprises still have no opportunities to access the market and always have low price by importers. “For that reason it makes high quality products still not building the trade mark, especially when importers use the trademark of the domestic company to sell the products on the market” Mr. Hung said.

Fiercely competitive

Beside the problems raised by the Ministry of Industry and Trade, enterprises also face difficulties when they access the ASEAN market. Especially, Vietnam’s products have to fiercely compete with Thailand’s and China’s products.

Mr. Pham Minh Hoang, an employee who has been in charge in the field of import and export of the Dong Anh Electrical Equipment Corporation has directly gone to Laos many times during the last 3 years to look for partners. The efforts which the enterprise spent on looking for partners have initial results by small contracts of about $US 1.5 million. But the enterprise must fiercely compete with Thailand’s enterprises (due to the technology and management implemented by Thailand in the Laos market, so Thailand has the knowledge and the business relationship). Therefore, this enterprise can not be a regular provider for customers in Laos, it has only replaced Thailand’s enterprises when their devices have problems. Mr.Hoang has seen the potential market of Laos but he has felt “powerless” because there is no information on the market and about partners.

Having the same opinions above, a representative of a Textile enterprise complains that “On the website, the information on the ASEAN countries’ markets is still unspecific. We need the official and full information which is published by the Ministry of Industry and Trade on these markets in order not to grope for the information for along time”. Other enterprises said when they contacted the Counselors Authority, the officers were very busy and have no time to contact and prepare the information support for the enterprise.

There are many difficulties in joining the ASEAN markets but according to the experts, these are the potential markets for Vietnam. Hence, the enterprises as well as the functional agencies need to pay further attention to this market. Mr. Do Quoc Hung also frankly admitted, when Vietnam integrates with the AEC it also means opening for the region’s goods flow in the domestic sector. Therefore, Vietnam’s goods will have to compete strongly with ASEAN’s goods and contrary to the goods which are exported to this region also under pressure. In order to enhance the competitive capacity and take advantage of the opportunities to export into ASEAN markets, enterprises have to innovate technology, enhance the quality and the rate of domestic products. Along with this, the enterprises need to focus on building the trademark which is based on quality and added value, building distribution channels in export markets and enhancing market research and promoting trade in order to exploit thoroughly potential markets in ASEAN.

Related to the information issues, in the coming time, the official information on ASEAN markets will be publicized on the website of the Ministry of Industry and Trade. The E-commerce Department of the Ministry had a survey information channel on the markets as well as the Import and Export Tariff Nomenclature which enterprises can contact for searching information, Mr.Hung said.

Mr. Pham Tat Thang, of the Trade Research Institute (the Ministry of Industry and Trade):

AEC establishment has created the single market and the general production space, therefore, there are 2 big problems posed.

Firstly, enterprises need to survey the demand of the market with more than 600 million people in different areas and countries to orient for manufacturing for that demand. But it seems that we have not set up the problem and implemented seriously. For example, have we thought about the manufacture of foods for Muslim consumers? In order to export goods to Indonesia, Malaysia, have we thought about exporting items which are provided for Muslims?. Hence the goods which are exported to ASEAN not much as the expectation.

Secondly, the general production space which requires enterprises to join the manufacturing chain, added value of ASEAN. For this problem we are still weak, we have not found a position and thought about joining to the manufacturing chain of ASEAN. This problem needs to be addressed.

It can be seen, ASEAN is a potential market which has the consumer style and consumer demand is very different. However, we have not thought about this problem, we only focus on exporting agriculture products, selling goods which we can manufacture as export to Philippines and Indonesia without thinking of other markets. In order to export to ASEAN we need to seriously think about the demand of consumers and manufacture for that market.

Vietnam’s goods have great similarity to ASEAN countries, if we continue to produce, it will be difficult for export and lead to trade deficit from ASEAN.

Source: http://customsnews.vn/vietnams-goods-need-to-upstream-into-asean-market-1687.html

Agriculture sector aims to complete 1.2 percent growth target

The agricultural sector was urged to exert all-out efforts in the remaining months of the year to realise the sector’s growth target of at least 1.2 percent in 2016.

Speaking at a press conference hosted by the Ministry of Agricultural and Rural Development (MARD) in Hanoi on November 9, Deputy Minister Ha Cong Tuan said the sector will take measures to maintain growth of fruit, vegetable and aquaculture exports.

He asked for special attention to fostering exports, controlling quality of exports and ensuring food safety to ensure entry to demanding markets like Japan and Europe.

According to the deputy minister, Vietnam’s key aquatic exports like shrimp and Tra fish recorded stable growth in the first ten months of 2016.

Export turnover of fruit and vegetables is estimated to reach about 2.5 billion USD, whilst aquaculture growth is expected to increase 7-8 percent.

The breeding and forestry industries are set to reach growth of 5 percent and 7 percent, respectively.

Regarding the livestock industry, localities were requested to keep track of the epidemiological situation, especially in the rainy season.

The Department of Livestock Production is responsible for outlining vaccination plans and directing localities to implement them.

The MARD also asked sectors and localities to devise measures to deal with the La Nina phenomenon, which causes rain and negative effects on agriculture production, especially this year’s winter-spring rice crop and the growing of industrial plants.

If these key fields can maintain their growth in 2016’s remaining months, they will help ensure the sector’s yearly growth target, compensating for the declining growth of food items, including rice, Tuan said.-VNA

Source: http://en.vietnamplus.vn/agriculture-sector-aims-to-complete-12-percent-growth-target/102221.vnp

Masan Consumer moves to get listed on UPCoM

(Masan Consumer Corporation will finalise the list of shareholders to prepare to trade on UPCoM. — VNS Photo www.news.zing.vn)

Masan Consumer Corporation will close its final list of shareholders on November 14 to prepare for its stock market debut on the Unlisted Public Company Market (UPCoM).

After closing the list, Masan Consumer, Việt Nam’s largest food and beverages producer, will undertake other required procedures, such as depositing shares and filing the listing application on the UPCoM.

“The company will put off all share transfers until its shares are officially trading on the UPCoM,” it said in a statement.

UPCoM, which went live in June 2010, is a market for unlisted or delisted public companies under the management of the HàNội Stock Exchange. It now has 366 stocks with a total market capitalisation of around VNĐ170 trillion (US$7.6 billion).

Masan Consumer has a charter capital of around VNĐ5.4 trillion ($242 million), equivalent to 538.2 million shares. Its parent company, Masan Consumer Holdings, holds 499.9 million shares, or 96.1 per cent of its voting shares. Masan Consumer itself has 18 million shares as treasury stocks. The remaining 20 million shares are freely transferable in the market.

In January 2016, Masan Consumer Holdings paid around $780 million to purchase 97.7 million shares of Masan Consumer at VNĐ179,000 per share.

If the company debuts shares on the UPCoM at this price, its market capitalisation will hit VNĐ93 trillion ($4.2 billion), which is three times higher than the market value of HàNội Beer Alcohol and Beverage Joint Stock Corporation (Habeco), the biggest listed stock on the UPCoM at VNĐ29 trillion.

Masan Consumer is one of the largest local fast-moving consumer goods (FMCG) companies. It manufactures and distributes a wide range of food and beverage products, including soya sauce, fish sauce, chilli sauce, instant noodles, instant coffee and popular bottled beverages such as Chin-su, Nam Ngư, Tam TháiTử, Omachi, Kokomi, Vinacafé and VĩnhHảo.

The company exports to the United States, Canada, France, Russia, Germany, China, Middle East and other Asian countries.

In the first nine months of this year, Masan Consumer earned VNĐ9.1 trillion in total revenue and VNĐ1.65 trillion in net profit, up 6 per cent year-on-year in revenues but down 4 per cent year-on-year in profits.

Many companies have recently opted to list their shares on the UPCoM because of the advantages of a central and transparent trading platform, but with lower listing standards compared to the HCM Stock Exchange and HàNội Stock Exchange.

Four companies – ĐồngNai Material & Building Investment Joint Stock Company (DND), Central Plant Protection Joint Stock Company No.1 (BT1), QuảngBình Railway Joint Stock Company (QBR) and TràVinh Urban Project Joint Stock Company (TVU) – debuted shares on the UPCoM on Thursday, with a total listing of nearly 18 million shares. — VNS

Source: http://vietnamnews.vn/economy/346021/masan-consumer-moves-to-get-listed-on-upcom.html#XJfOLmTkuT5ZUHJ9.99

CJ Group Inaugurated Its Animal Feed Production FactoryInVung Tau Province

This morning (10/11), CJ Corporation (Korea) has inaugurated feed ingredient factory in Ba Ria-Vung Tau province.

With a total investment of 18.3 million USD, specializing inproducing feed ingredient from soybean meal, and some other ingredients. Total capacity is approximately 22,000 tonne per year.

General Manager CJ Group Vietnam, Mr. Chang Bok Sang said the new factory of CJ is equipped with the advanced technological equipment to ensure the quality of products, thereby supporting farmers in breeding and raising profits. The investment in building the new factory also confirms long-term commitment of CJ when investing in Vietnam, as well as the desire of the group to contribute to the development of the agriculture sector in Vietnam.

"the new factory will bring better products to customers, as well as respond to CJ's development plans in the coming years," Mr. Chang Bok Sang said. On 9/9/2016, in Korea, CJ CHEILJEDANG (subsidiary that specializes in the food of CJ Group) signed a cooperation agreement with Trade Corporation Saigon (SATRA) to expand the food business sectors in Vietnam. In addition, two companies also agreed to cooperate in the field of producing the model for the processing of CJ CHEILJEDANG drinks in Vietnam.

CJ Group was formally established in 1953 in Korea, is originated from a sugar producing company. CJ group now becomes one of the biggest lifestyle conglomerate with an existence in 24 nations worldwide. Core business of CJ includes Foods & Food Service, Bio &Pharma, Entertainment & Media, Home-shopping & Logistics. CJ has been in Vietnam since 1998, having some favorite brands including Tous les Jours, CGV, SCJ TV Homeshopping, vv. 

Source: http://channuoivietnam.com/tap-doan-cj-khanh-thanh-nha-may-thuc-chan-nuoi-tai-vung-tau/

EU - potential market for Vietnamese farm produce

Vietnam’s exports to the EU grew significantly in recent years, with Vietnam’s trade surplus in the market reaching nearly 20 billion EUR in 2015, mostly from exports of agricultural products and foodstuff.

The Vietnam-EU free trade agreement (EVFTA), scheduled to take effect from 2018, is expected to bring about opportunities for enterprises of both sides in seeking new markets for high quality farm produce.

According to Phil Hogan, EU Commissioner for Agriculture and Rural Development, Vietnam is a promising market for EU businesses in agriculture and food.

During his recent visit to Vietnam, Hogan and 42 EU firms met with Vietnamese businesses to forge stronger EU-Vietnam partnerships and realise the EVFTA.

The EU has been the world’s top exporter of farm produce and foodstuff, with 2015 revenue of 129 billion EUR, including 8.4 billion EUR in the Vietnamese market, noted Hogan. 

The EU market has highest food safety requirements in the world, he said, adding that EU products with advantages in Vietnam include milk, pork, poultry products, wine and fresh fruit. 

Vietnamese products enjoying advantages in the EU are cashew, peppercorn and aquaculture products, he said. Hogan also expressed his belief that two-way trade will continue to thrive once tariff barriers are removed in 2018.

According to Hogan, the EU will not lower standards for imported farm produce and foodstuff. 

The EU will send back all products failing to meet its requirements. Therefore, Vietnamese firms who wish to enter the market should enhance the quality of their products, advised Hogan, adding that many Vietnamese enterprises have succeeded in exporting their products to the European market.

Meanwhile, Miriam Garcia Ferrer, First Counsellor and head of the Economic and Trade Section of the EU Delegation to Vietnam, asserted that Vietnamese exporters should study the EU market more.

European consumers are keen on Vietnamese specialties, she said, adding that the impressive growth of Vietnam’s exports in the EU in recent years, mostly contributed by agricultural products and foodstuff, reflected the high potential.

The potential will be optimised through the implementation of the bilateral FTA as well as tax removal beginning from 2018. We believe that the FTA will benefit both sides, said Ferrer. 

Being aware of challenges that Vietnamese firms face in meeting its technical and transparency requirements, the EU side has worked to assist them, she said.

She held that many Vietnamese firms are worried when accessing the EU market due to high requirements in quality, origin, package and label. However, it’s time to change their mindset, she said, affirming that once the products are accepted in the EU, they will be accepted elsewhere. 

The requirements may cause difficulties for Vietnamese products in the short term, but they also allow Vietnam to affirm the prestige and competitiveness of its products, she stated. 

She also suggested Vietnamese firms better understand the preferences they will enjoy in the EU market. 

In 2015, Vietnam-EU trade reached 38.4 billion EUR, with Vietnam ’s export reaching 29.9 billion EUR. In the year, Vietnam ranked 21 st among the EU’s trade partners, while the EU was the second largest partner of Vietnam after China.-VNA

Source: http://en.vietnamplus.vn/eu-potential-market-for-vietnamese-farm-produce/102079.vnp

Seafood exports benefit most from Việt Nam-EAEU FTA

Seafood exports benefit most from Việt Nam-EAEU FTA

The aquatic sector will see the most benefits from the agreement between Việt Nam and the Eurasian Economic Union. — Photo www.thinhphatco.com.vn

Nearly 90 per cent of tariffs have been eliminated or reduced, with 59 per cent abolished after the Free Trade Agreement (FTA) between Việt Nam and the Eurasian Economic Union (EAEU) took effect in October 2016.

This is an advantage for Việt Nam when exporting goods to EAEU countries, compared with other countries throughout the world.

The aquatic sector will see the most benefits from the agreement, since the EAEU will reduce its import tax from 10 per cent to zero for aquatic products from Việt Nam, including processed foods.

Some of the processed and canned products, such as tuna and shrimp, will enjoy preferential taxes, but they are groups in which Việt Nam lacks materials. Another 5 per cent of taxes will be applied to other seafood products that are not important exports from Việt Nam.

Agro-forestry products will receive the least benefit. For rice, the EAEU has a set an initial quota of importing 10,000 tonnes of rice per year from Việt Nam with zero taxes. The above-quota amount will be levied as the most-favoured nations (MFN) tax. In addition, Việt Nam’s annual rice export volume is dependent on demands from EAEU countries.

The agreement will not reduce taxes for green tea packages weighing under 3 kg. Zero taxes are applied only for raw Vietnamese coffees and peppers, while there will be no tax exemption or reduction for processed products. — VNS 

Source:  http://vietnamnews.vn/economy/345823/