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Russian WTO membership to bring golden opportunities to Vietnamese goods
If Russia fulfills all the commitments it made when joining the World Trade Organization (WTO), there would be the great advantages Vietnam can take to boost exports to Russia.
The fact that Russia would become the 155th official member of WTO after August 10 is the event expected not only by Russian, but by Vietnamese businessmen as well.
Duong Hoang Minh, Deputy Director of the European Market Department under the Ministry of Industry and Trade, said that Russia is a powerful economy with a vast market and rich in natural resources.
“If Russia fulfills all the commitments it made when joining WTO, there would be the great advantages Vietnam can take to boost exports to the country,” Minh said.
Russia has committed to cut the average import tariff from 10 percent to 7.8 percent. Vietnam’s farm, forestry and seafood exports to Russia, which account for 50 percent of the total exports to the market, would see the tariffs down from 13.2 percent to 10.8 percent. As for industrial goods, the import tariff would be eased from 9.5 percent to 7.3 percent.
Besides, Vietnam and Russia have had a committed package which would automatically take effects when Russia obtains the full WTO membership.
Meanwhile, Vietnam is also expected to bring benefits to Russia as the Russian most important partner in South East Asia. Fertilizer and steel – the most important export items to Vietnam would be more easily penetrate the Vietnamese market, thanks to the low tariffs Vietnam offers to WTO’s members.
Nevertheless, Vietnamese businesses have been warned that it would be not easy to take full advantage of the lower tariff to boost exports to Russia. The businessmen, who have been doing business in Russia, said that the door to the market would be opened more widely only to the enterprises with powerful financial capability and good relations.
An executive of Satra Thai Son in HCM City, a big seafood exporter, said the company once very succeeded in Russian market and cemented its firm position on the market over the last 10 years.
However, Satra Thai Son has decided to quit the Russian market and it has shifted to export products to China.
Nguyen Quoc Hung, Deputy Director of Satra Thai Son, has affirmed that the company does not intend to come back to the Russian market, even though seafood products would be able to enjoy lower tariffs.
“Russia is a choosy market, while it takes at last six months for the capital turnover. Meanwhile, it takes just a couple of weeks with the Chinese market. Especially, it would be very costly to ask for necessary licenses,” Hung said.
“Besides, you still have to overcome a technical barrier, which would be impossible for everyone, who does not have much money,” he added.
The barrier has also been keeping farm produce exports of the Nam Dinh Farm Produce Processing Company out of the Russian market.
In 1994-2004, the company exported pork products to Russia regularly with the annual turnover of 800,000 dollars a year. However, after 2004, Russia unexpectedly banned the imports from Vietnamese companies due to the epidemics.
Nguyen Trung Kieu, Chair of the company, said the company spent a lot of time and money to check the production phases, upgrade the production lines, then submitted necessary documents to prove the safety of its products. The company also invited Russian officials to Vietnam to examine the production lines. However, to date, no reply has been made.
vietnamet
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