Early trade warning needed to better defend Vietnamese products

According to data from the Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade (MoIT), Vietnamese products have been involved in 235 trade remedies investigations in 24 markets around the world. The majority of the cases were anti-dumping (129), trade safeguard (47), evasion investigation (34) and anti-subsidy (24) in nature with products including wooden cabinets, laminated wood, solar panels, shrimp, basa fish, high-pressure washers, foam mattresses, grass cutting machines, cigarette paper, and honey.

Nguyen Thu Trang, director of the WTO and Integration Centre at the Vietnam Chamber of Commerce and Industry (VCCI), said there has been a significant surge in the number of cases in recent years. As of late October, close to 40 Vietnamese product categories have faced investigations, with over 52 per cent of all cases initiated in foreign markets.

To make matters worse, more markets have started implementing trade remedies. To date, a total of 24 markets have started investigations into Vietnamese goods, including both traditional and newer markets. Of the number of ongoing investigations, the US accounted for (23 per cent), India (14 per cent), and Turkey (10 per cent), followed by Canada, the EU, the Philippines, and Indonesia.

Vu Van Phu, vice chairman and secretary-general of the Vietnam Aluminum Association, said as the Southeast Asian economy ramps up efforts to integrate into the global economy the number of trade investigations and Vietnamese goods that face them will only increase.

Phu said Vietnamese aluminium exporters have been involved in four trade remedies cases since the beginning of the year. There has been considerable pressure on companies as they said they have little experience in dealing with them.

Chu Thang Trung, deputy director of the Trade Remedies Authority of Vietnam said Vietnamese exporters must get used to trade remedies and defence mechanisms in global trade as the country's export turnover grows rapidly.

"There is no getting around them. The question is how to better support Vietnamese businesses in trade remedy investigations," he said.

Trung said an early warning is proof that the system is working as intended and that the authority has been in the process of narrowing down Vietnamese products that were either often invoked investigations in the past or those that have experienced rapid growth recently. These are the products to look out for, he said.

"We'd rather be safe than sorry. Of course, we do not want our warnings to come true but it is better for businesses to be aware of their risk than to be caught unprepared," Trung said.

According to the VCCI, in most cases, Vietnamese companies were not able to mount an effective defence due to a combination of factors such as slow to response, poor preparation and lack of legal knowledge.

An early warning system, Trang said, could address some of the issues above by giving companies more time to prepare their cases if needed.

"It's better to present a good case than trying to minimise damage. Having more time will allow companies to gather more accounting data to support their case," she said.

Source: VNS