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Great challenges for Vietnam seafood in 2017

09:04 | 15/01/2017

VCN - According to VASEP, in 2016, Vietnam seafood exports reached about $US 7.1 billion, up by 8% compared to 2015, according to assessment of the experts, there will be 7 main challenges for the Vietnam seafood industry in 2017. 

great challenges for vietnam seafood in 2017 2017: trying to export more than the rate of 6-7%
great challenges for vietnam seafood in 2017 Seafood export enterprises to benefit from the reduced import tariffs of China
great challenges for vietnam seafood in 2017 2017: exports wait for signs from market
great challenges for vietnam seafood in 2017

Seafood processed for export. Photo: Thu Hoa

1. Drought and salinity intrusion: The situation of drought and shortage of fresh water and salinity intrusion which took place in 2016, are forecasted to continuously affect to the seafood manufacturing activity, especially species in freshwater, in 2017 - a significant impact on the area and volume of seafood materials in general.

2. Technical barriers and trade protection from import markets. With trade liberalization, Vietnam seafood will benefit from tariffs, but it will be subject to application of non-tariff barriers by the markets to protect domestic production or limit exports. The barriers such as antidumping, countervailing duties, regulations on chemicals test, antibiotics, and protection of the IUU profit resources or individual inspection programs (eg. The catfish inspection program of the US) are being strengthened to apply. Regarding the regulations on quality control of importing markets: Japan maintains the inspection frequency of 100% for targets of Furazolidone, Enrofloxacin and Sulfadiazine for shrimp consignments imported from Vietnam. However, under the new provisions of the Japanese Law on Food Hygiene, from October, 2016, Japan removed from the supervision list of substances Sulfamethoxazole, Sulfadiazine and chloramphenicol in Vietnam farmed shrimp. Australia strengthens the inspection of biological toxins and microorganisms. From January to September, 2016, 11 Vietnam seafood shipments exported to the EU were warned due to the residues of heavy metals (mercury, cadmium) exceeding the allowed maximum limit, increasing by 2.2 times compared the whole year 2015.

Controlling and conserving profit resources: For catching and exporting tuna, besides the provisions of the National Oceanic and Atmospheric Administration (NOAA) under the United States Department of Commerce and Earth Island Institute (EII) relating to the dolphin protection programs in tuna exports. The EU and the US tighten the regulations to control and fight against the illegal fishing , unregulated fishing and unreported fishing (IUU). The Anti-dumping tax and inspection program of catfish: the anti-dumping tax and inspection program of catfish are still great trade barriers and technical barriers to Vietnam catfish in the US market. With anti-dumping tax rate high, at present, there are only 2-3 large exporting enterprises on Tra fish to the US. The inspection program of catfish with some strict regulations is in a transitional period. Although this program does not affect significantly to the Tra fish export turnover to the US market, but psychologically disturbing for exporters. The anti-dumping tariffs on POR10 shrimp increases at a high level, causing disadvantages for Vietnam shrimp exports to the US, creating psychological pressures to the export enterprises and create unstable psychology for customers. 3. The price of material production in Vietnam is still high: the shrimp farming industry and a number of key seafood products of Vietnam have been recognized and compared with similar industries in India and Thailand, showing that the price of material production in VN is higher by 10-30%. There are many factors causing the high prices of products (from breeding shrimps, feed, input materials, post-harvest losses, electricity-water, administrative costs ...). This is also an important factor affecting the competitiveness of Vietnam seafood in 2017, drawing attention of enterprises. 4. Material shortage for export processing: With a reputation on the quality supplies for world markets and high technology for seafood processing, Vietnam is a destination for many world’s seafood importers. The material shortage for export processing in some commodity groups or in some periods in a year is increasingly evident. Many enterprises maintained the imports of raw materials (shrimp, tuna, squid, octopus, sea fishes) to create stability and competitiveness in recent years. The lack of domestic seafood materials for export demand will continue to be an issue of seafood enterprises’ concerns in 2017.

5. Under fierce competition: Joining in FTAs means the opening and further integration into many markets. However, many Vietnam sectors and enterprises have not effectively taken advantages of the incentives/opportunities of the FTA. Although the Government issued many Resolutions and action plans to remove difficulties, enhance competitiveness and create opportunities and maximum conditions for enterprises, and the restructuring and reform of the rules and administrative procedures to meet the requirements of integration have not quickly developed. . Meanwhile, the competitors on seafood (China, India, Thailand, Indonesia) are putting increasingly competitive pressures through long-term, medium-term and short-term programs on the scale of productivity, quality, production cost, marketing and trade promotion. This competition is indispensable to promote the development, but also makes difficulties for Vietnam seafood enterprises in keeping and increasing their market share.

6. Vietnam seafoods were smeared by the Media in some markets: In the past 10 years, the Media smeared and provide inaccurate and subjective information (polluted, dirty, heavy metals, environmental pollution) on Vietnam seafoods in 10 countries (Australia, Italy, Spain, Germany, Egypt, France), causing immeasurable and long-term negative impacts on the image of Vietnam seafood in certain markets. These negative information flows under the spread of internet and social networks, have caused persistent impacts and been identified to affect the consumption of Vietnam seafood in 2017.

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7. As for the shortcomings in some administrative regulations and procedures: these have not actually supported the improvement of enterprise’s competitiveness. Although the Government has issued Resolution No. 19 and a lot of positive directions in 3 consecutive years, the process of amending the legislation identified was still slow (less than 30% in 2016) while arising new inadequacies. A next Resolution 19/2017 of the Government is necessary, but of more importance is the shift in the changes and amendments from legal documents related to the execution of State management units.

By Le Thu/ Huyen Trang