Facing trade defense barriers
According to the General Department of Customs, from the beginning of 2024 to February 15, the export turnover of wood and products reached more than 1.82 billion USD, an increase of 50.3% over the same period last year. Among the main export markets of this group of goods, the United States ranked first with a turnover of 821 million USD (updated to the end of January 2024), an increase of 123.6% over the same period last year.
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| The United States is currently Vietnam's largest buyer. |
Mr. Tran Ngoc Liem - Director of the Vietnam Federation of Commerce and Industry, Ho Chi Minh City branch, said that from December 2023, the recovery will be more evident when the export turnover of wood and wood products, furniture recorded a growth rate of up to 10%, much higher than the growth rate of the total export turnover of the whole country...
However, Mr. Tran Ngoc Liem assessed that the market still has many potential difficulties when conflicts between countries are complicated and prolonged, affecting the business activities of enterprises.
Notably, wooden cabinets imported from Vietnam are being investigated by the US Department of Commerce (DOC) for product scope and trade defense tax evasion. According to the DOC's announcement, the final conclusion of the investigation considering the product scope is expected to be issued on April 5, 2024. Regarding the tax evasion investigation, the US Department of Commerce has also continued to extend the time to issue the preliminary and final conclusions of the case to April 19 and July 18, 2024. The DOC's investigation of this item will impact the export activities of wooden cabinets from Vietnam.
According to the Ministry of Agriculture and Rural Development, in the first two months of 2024, the total export turnover of agricultural, forestry and fishery products is estimated at 9.84 billion USD, an increase of more than 50% over the same period last year. Of which, the United States is the largest buyer of agricultural, forestry and fishery products from Vietnam in the first two months of 2024 with a turnover of 2.1 billion USD.
As of January 15, 2024, Vietnam's shrimp exports to the United States reached more than 15 million USD, up 4% over the same period in 2023. However, recently, the American Shrimp Processors Association (ASPA), an organization representing the interests of the US wild shrimp and shrimp processing industry, has recently filed a petition to impose anti-dumping duties on frozen shrimp imported from Ecuador and Indonesia, and anti-subsidy duties on shrimp imported from Ecuador, India, Indonesia and Vietnam. The outcome is unclear, but Vietnam's shrimp exports to the United States will be affected in the first half of 2024.
The United States is the country that has investigated all trade defense measures against Vietnamese exports (including dumping, subsidies, tax evasion, and self-defense). In the first 11 months of 2023, the United States received/initiated 4 trade defense cases against Vietnamese exports. Although there was a decrease compared to the same period in 2022, the level of affected turnover tended to increase.
In addition, US Customs continues to initiate and impose temporary duties on a number of Vietnamese goods for trade defense tax evasion (in addition to increasing the application of the Force Act).
In addition, the United States is also considering enacting a series of changes in trade defense investigations that are increasingly difficult for businesses and are likely to increase tax rates in the future.
According to the Vietnam Trade Office in the United States, the difference between the US trade defense cases with Vietnam and the US with some other countries is that the US has not considered Vietnam as a market economy, so the US uses the replacement value from a third country to calculate our exports, leading to the tax rate often being pushed higher.
This has caused the tax rate in some dumping cases to be pushed up very high, not reflecting the reality in Vietnam, causing damage to exporters and making goods lose their competitiveness in the US market.
Increase capacity, take advantage of export opportunities
According to data from the Ministry of Industry and Trade, in the first two months of 2024, the United States was Vietnam's largest export market with an estimated turnover of 17.4 billion USD, an increase of nearly 34% over the same period last year.
The "explosion" in trade between Vietnam and the United States in the new context of 2024 is requiring Vietnamese businesses to continue to improve and prepare more to take advantage of the opportunities opened up in export.
Dr. Can Van Luc - Chief Economist of BIDV Bank, member of the National Financial and Monetary Policy Advisory Council said that many US policies are opening up great opportunities for Vietnamese goods. Along with the opening opportunities are many challenges for businesses. "The US market will also apply new regulations such as the Cross-Border Carbon Adjustment Mechanism. Therefore, businesses need to focus on green products that have little impact on the environment," Dr. Can Van Luc shared.
According to Dr. Vo Tri Thanh - former Deputy Director of the Central Institute for Economic Management, greening, digitalization and the shift in supply chains, investment and trade are three trends in the new context of Vietnam - US relations. Therefore, businesses need to pay special attention to risk management issues, take advantage of opportunities and keep up with trends.
From a business perspective, Mr. Phan Minh Thong - Chairman of the Board of Directors of Phuc Sinh Group shared that the experience of businesses when doing business with US enterprises is to be willing to travel to meet partners directly. In addition, businesses implement sustainable development solutions, which has brought great advantages to the company to be able to develop around the world.
According to experts, the United States is not a single market but a diversified market, because there are 50 states, each with its own differences in geography, weather, culture, and commercial practices. Therefore, businesses need to determine which state their products will be sold in and find out specific information about that state.
On the other hand, there are always many competitors in the US market, but the advantage is that the legal regulations are very clear, transparent, information can be easily looked up and the law here is also very strict. However, before exporting goods to the US, businesses need to carefully study the legal regulations here, including customs regulations, correctly identify HS codes, C/O to avoid future consequences. Non-tariff barriers are also something businesses need to pay close attention to.
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