Fisheries sector: Removing “yellow card” to take opportunities from EVFTA (12-07-2019)
Fisheries sector is one of the sectors that are considered to be of great benefit when the EU - Vietnam Free Trade Agreement (EVFTA) is approved. However, to take the opportunity, the fisheries sector needs to quickly remove the “yellow card” warned by the European Commission (EC).
90% of tariff lines are cut off
When EVFTA is signed, up to 90% of tariff lines of seafood products are committed to be cut off to 0% with the longest schedule of 7 years. This is a big boost to the seafood industry. EU is currently the second largest seafood export market of Vietnam, after the US. This market always accounts for 17-18% of total seafood export value of Vietnam. In particular, for shrimp products, EU accounted for 22% of the proportion of exports; for tra fish, it accounted for 11%, and the proportion of seafood products is about 30-35%. According to Truong Dinh Hoe, Secretary General of Vietnam Association of Seafood Exporters and Producers (VASEP), the import tariff on seafood into the EU is currently at 14% on average, many of which are subject to high taxes of 26%, but when EVFTA comes into effect, about 840 basic tariff lines, accounting for about 50% of the tariff lines for aquatic products will be erased; the rest has a reduction schedule of 3 - 7 years. “The EU is an important market of Vietnamese fishery sector, especially shrimp products. Import duties on shrimp to this market will decline sharply from the first year EVFTA comes into effect, then gradually reduce to 0% in the following years. In addition to shrimp, tuna also has many advantages. Thailand and China are the two biggest rivals in Vietnam, holding a large export market share, but neither has signed a free trade agreement with the EU” - Hoe said. From an enterprise perspective, Mr. Pham Hai Long, General Director of Agrex Saigon Food Joint Stock Company acknowledged: “We expect EVFTA with a 0% tax reduction on a 3-7 year roadmap to create greater opportunity, helping export revenue to this market increase strongly in the coming time. At the same time, the price of imported raw materials from EU will also be cheaper, creating more favorable conditions for businesses”. In addition to the advantages, the EVFTA has some challenges in terms of technical barriers that Vietnamese seafood exporters need to pay attention to. Dr. Pham Van Chat, reporter of the Ministry of Industry and Trade, said that seafood products imported into the EU must have official certification from the competent authority of the exporting country outside the EU. This agency is recognized by the EC. This is a prerequisite for exporting countries to qualify seafood exports to the EU. It is known that seafood products imported into the EU must go through the certification of the Border Inspection Post. Each shipment must be systematically inspected, checked for uniformity and physical inspection. Besides, from January 1, 2010, the EC has established a Control System to prevent, combat and abolish IUU fishing. Implementing the law, on October 23, 2017, the EC warned “yellow card” for Vietnamese seafood. Until now, EC has not withdrawn the yellow card, although the ministries, agencies and sectors have made great efforts, but the results have not accorded with the EC’s requirements and recommendations.
Efforts to remove the “yellow card”
Mr. Nguyen Ngoc Oai, acting General Director of the Directorate of Fisheries said, in the coming time, the sector will make more efforts to remove the “yellow card”. This is an extremely important task in the last months of the year as it will seriously affect the fisheries sector and the life of fishermen if it is not removed. On the other hand, it will hinder the fisheries sector from entering EVFTA. Deputy Minister of Agriculture and Rural Development Phung Duc Tien evaluated that the actual results of overcoming “yellow card” that localities now achieve do not meet the EC’s requirements and recommendations. One of the basic reasons is that localities have not really participated in a drastic way, while from the Government, ministries and central branches are fierce. Mr. Tien suggested that it is necessary to strengthen inspection, supervision and general practice, and there are specific solutions to overcome EC yellow card. Functional units should advise and organize synchronously implementing groups of solutions to overcome yellow card, including maintaining the National Steering Committee on IUU fishing every month; strengthen the organization of interdisciplinary working groups to check the situation against IUU fishing in key localities.