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Exporters look east anticipating VN-Japan free trade pact
Vietnamese companies are pinning their hopes on increasing exports Japan as a free trade agreement between the two countries takes effect on October 1.
About 92 percent of Vietnamese exports to Japan would be exempted from tariffs within 10 years under the Vietnam-Japan Economic Partnership Agreement, which the Japanese House of Councilors approved on June 24.
Huynh Quang Dau, general director of An Giang Agricultural Technology Service Company, said many Japanese have ordered more products and larger volumes recently. The company currently ships frozen and canned sweet potatoes, okra, pineapple, and baby corn to Japan.
“The fact that import taxes on many Vietnamese agricultural products will reduce from 5 percent to zero percent will help Vietnamese products be more competitive on the Japanese market,” said Dau.
“We believe our exports to Japan will increase by 20 percent in the coming months,” he said, “This will be very significant as our sales to foreign customers have declined by 20-30 percent due to the struggling global economy.”
Shrimp exports would become tax-free immediately, compared with the current tax of 4.5 percent, according to Nguyen Van Kich, general director of seafood processor Cafatex Company.
“Surely this will increase our competitiveness,” he said. “We are very happy about this as we have exported a large number of shrimp to Japan but face fierce competition from other ASEAN countries which have already signed trade pacts with Japan.”
Around 60 percent of Cafatex export volume goes to the Japanese market, including 7-Eleven convenience stores and Ito-Yokado supermarket outlets. Kich said his company expects to ship its products to more supermarkets in Japan.
Le Van Quang, general director of Minh Phu Seafood Joint-Stock Co., Vietnam’s largest publicly traded seafood company, said the tax exemption on Vietnamese shrimp would have a positive effect on the local industry as shrimp production costs in Vietnam were much higher than neighboring countries.
Japan is now Vietnam’s biggest shrimp consumer, importing a turnover of more than US$265 million from the country in the first eight months of this year alone.
Hurdles
Though many fresh Vietnamese vegetables and fruits exports to Japan are eligible to enjoy the preferential tax rate of zero percent, Vietnamese companies have yet to be able to ship their fresh produce to Japan due to quality barriers, said Nguyen Huu Dat, director of Post-Import Plant Quarantine Center No. 2 at the Ministry of Agriculture and Rural Development.
Only dragon fruit is expected to be allowed to ship to Japan by the end of this year, he said.
Hirota Nakanishi, an investment consultant at the Japan External Trade Organization (JETRO), said there were still some problems exporting fresh Vietnamese fruits to Japan and the two governments needed more negotiations.
thanhnien, TuoiTre
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