| What should Vietnamese businesses do in the face of foreign trade defense investigations? Limiting trade defense risks when increasing exports to the CPTPP market |
Vietnam's trade defense investigations are increasing, especially in the process of implementing FTAs, including the CPTPP Agreement, which is posing challenges for export enterprises. Mr. Phung Gia Duc, Deputy Head of the Foreign Trade Defense Department, Trade Defense Department, Ministry of Industry and Trade, discussed this issue.
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| Vietnamese businesses need to be more proactive in the face of trade defense measures. Photo: VNA |
Could you please tell us about the characteristics and trends of trade defense cases related to Vietnam's FTA markets in general and markets of CPTPP member countries in particular?
Trade defense laws are allowed by members of the World Trade Organization (WTO) to be used to protect domestic production. Therefore, even countries that do not have an FTA with us have investigated and applied many trade defense measures against Vietnamese export goods.
However, for countries with FTAs in general and CPTPP in particular, this number has increased rapidly. Because the growth momentum from CPTPP in particular and FTA in general has contributed to increasing the export value of Vietnam to many new markets. And because our goods are popular and highly competitive, it creates pressure on the domestic manufacturing industry of importing countries.
For this reason, the domestic industry of the importing country wants the Government of the importing country to apply trade restriction measures, and currently the most common are trade defense measures, anti-dumping, anti-subsidy and self-defense.
In addition to the countries that have FTAs with Vietnam for the first time, such as Canada, Chile and Peru, many CPTPP members have investigated trade defense measures against Vietnam, such as Australia and Malaysia. For example, Australia has investigated 18 trade defense cases against Vietnam, equivalent to Canada, Malaysia has also investigated more than 10 cases. When we had an FTA with Vietnam, we also increased exports to Mexico, so since 2019, we have had 3 new cases, all of which arose after we signed the CPTPP with Mexico.
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| Mr. Phung Gia Duc, Deputy Head of Foreign Trade Remedies Handling Department, Trade Remedies Authority, Ministry of Industry and Trade |
Currently, which products are at risk of being investigated for trade defense measures and what are the difficulties businesses face when facing these measures, sir?
A trade defense case is initiated, first of all, by an increase in imports. Therefore, the most vulnerable and most easily investigated products are those with rapid and strong export growth.
According to our statistics, Vietnam's advantageous and backbone products are seafood, wood and wood products, basic metal products such as steel, aluminum, textile-related products and some chemical products... These are traditional products that will continue to face the risk of trade defense lawsuits in the future, even in FTAs and the CPTPP market.
In the face of the trend of trade defense investigations, state management agencies are increasing support, which is a great advantage for businesses. In addition, businesses have had early experiences, many businesses, industries, and associations have had the opportunity to rub shoulders with trade defense cases, so they have also responded very quickly and promptly when something happens.
However, regarding difficulties, although the current laws of each country are based on the general regulations of the WTO, countries also internalize their own laws with small conditions, the conditions are still different, so when facing specific matters, businesses need to carefully research the trade defense laws of that country.
Next is the language issue, which is a matter of principle in trade defense investigations. Accordingly, countries will use their own language when investigating trade defense, causing a huge barrier for Vietnamese businesses, due to the complicated translation process.
In my opinion, the most difficult thing is the awareness of businesses when participating in the global "playground". If businesses only want to export and make quick profits without caring about the long term, it will be very dangerous. Therefore, business awareness is really important in the field of trade defense.
From those difficulties, what do you recommend for businesses to respond more effectively to foreign trade defense measures?
To respond to trade defense measures, businesses currently have great support from the Government, the Department of Trade Defense, Ministry of Industry and Trade. In particular, the Department of Trade Defense is regularly updating and providing quick and timely information on trade defense to the business community. Therefore, businesses need to take advantage of, pay attention to and refer to. In addition, information from Vietnamese trade offices abroad is also an important and official source that businesses should take advantage of and grasp.
In addition, businesses must have a very close relationship with import partners because they are the ones who have the fastest information, even unofficial information, and rumors in the market. In addition, when exporting to the target market, businesses should devote a resource to researching the trade defense laws of that market, this is a very effective way to prevent the risk of being sued.
In the coming time, could you please tell us what actions the Trade Defense Department will take to support businesses in limiting the risk of being investigated and applying trade defense measures to FTA markets?
Recognizing the changing issues of international trade and the increasingly rapid growth of Vietnamese trade, we are increasingly exporting more and more to foreign countries, to new markets, the Department of Trade Defense is implementing activities and contents of specialized projects on trade defense.
In particular, the Trade Defense Department has been promoting the dissemination of general knowledge about trade defense; especially focusing on information about the trend of investigating and evading trade defense measures to businesses. At the same time, implementing training programs to raise awareness in a more in-depth way about trade defense so that businesses and business associations that do not have enough resources to conduct research on their own will have the opportunity to participate.
On the other hand, we will also regularly organize dialogues on trade defense with foreign investigation agencies, aiming to bring positive results as well as better protect the interests of businesses.
Thank you!
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