Improving the efficiency of border trade activities

Border trade plays an important role in foreign trade activities.

With more than 5,000km of shared border with China, Laos and Cambodia, located in the center of Southeast Asia, Vietnam possesses many advantages and strategic conditions to expect to rise to become a trading center in the region, becoming an important trade gateway connecting neighboring countries and countries in the Southeast Asian region in particular with developed economies in the world in general.

To promote trade in goods and services across the land border, the Vietnamese Government has signed border trade agreements with the governments of China, Laos, Cambodia, etc. In particular, trade promotion through border gates has always been focused on and brought about positive results.

Border gate economy plays an important role in foreign trade activities. Photo: VNA

Ms. Nguyen Thi Mai Linh - Head of Trade Facilitation Department - Import-Export Department - Ministry of Industry and Trade said that border trade is facing new development opportunities. In particular, the land border with the system of border gates, traffic routes, transnational economic corridors, economic cooperation zones, border economic zones, free trade zones and bonded zones have been built and upgraded, and are considered one of the main and important gateways in economic, trade and investment cooperation between Vietnam and ASEAN countries with China. The establishment of the ASEAN - China free trade area has created a great driving force for economic, trade and investment cooperation between the two markets of ASEAN and China...

According to the General Department of Customs, in 2023, Vietnam's total import-export turnover through land border gates to the three markets of China, Laos and Cambodia will reach 50.38 billion USD, an increase of 52.2% compared to 2022, accounting for 27.68% of the total bilateral import-export turnover with the three markets.

In the first 8 months of 2024, import and export turnover to these markets also increased sharply. Of which, export turnover to China reached 43.6 billion USD, up 1%. Also in the first 8 months of 2024, export of goods to Laos reached 429.5 million USD, up 20.6%. Exports to Cambodia reached 3.5 billion USD, up 3.9% over the same period last year. In this export structure, there is an important part from border trade.

However, in addition to the advantages, border trade along the entire land border still faces many difficulties. Although the infrastructure at the border gate areas of the border provinces has received investment attention, especially the transport infrastructure, the logistics system still has some problems such as difficulties in exploiting the railway with China due to the lack of synchronization in the track gauge; the river system is steep, with many hidden rocks when exploiting transport; there is no logistics center with full basic functions...

In parallel, with major partners such as China, goods exported through border gates in the provinces bordering Vietnam - China are mainly agricultural products and fruits; the number of types of agricultural products and fruits exported is also limited compared to the potential for production and processing of agricultural products and fruits in Vietnam. In addition, some agricultural products have not signed the Protocol on quarantine, so 100% of the shipment must be physically inspected, affecting customs clearance time. On the border with Cambodia, Vietnam's export goods to Cambodia have a similar structure to those of Thailand and China and are subject to fierce competition in terms of quality, design and price...

Creating a legal corridor to promote border trade development

To promote the development of border trade, the authorities are making efforts to develop legal documents and submit them to the Government for promulgation to facilitate border trade activities. In addition, promoting trade and enhancing promotional solutions for Vietnamese products and goods.

Recently, the Government also issued Decree No. 122/2024/ND-CP dated October 4, 2024 amending and supplementing a number of articles of Decree No. 14/2018/ND-CP dated January 23, 2018 of the Government detailing border trade activities.

Decree No. 122/2024/ND-CP amends and supplements Clause 2, Article 4 of Decree No. 14/2018/ND-CP regulating payment methods in border trade activities. Accordingly, Decree No. 122/2024/ND-CP still stipulates 3 payment methods: Payment via bank; clearing between exported goods and services and imported goods and services (the difference paid via bank); and payment in cash. However, according to the new regulation, the cash payment method is only applied to the purchase and sale of goods by border residents.

At the same time, Decree No. 122/2024/ND-CP supplements Article 4a regulating commodity standards in border trade activities.

Accordingly, goods in cross-border trading and exchange activities of traders and border residents must fully meet standards, quality, regulations on traceability and other conditions according to the laws of the importing country.

Decree No. 122/2024/ND-CP also amends and supplements Clause 1 and Clause 2, Article 16 of Decree 14/2018/ND-CP regulating the subjects of buying, selling and exchanging goods at border markets as follows: Traders and citizens of Vietnamese nationality who have registered residence in border areas.

Traders and citizens of countries sharing a common border, with passports or documents that can replace passports and visas, except for cases of visa exemption, still valid according to international treaties to which the Socialist Republic of Vietnam is a member and the Law on Entry, Exit, Transit and Residence of Foreigners in Vietnam No. 47/2014/QH13, which has been amended and supplemented by a number of articles under Law No. 51/2019/QH14 and Law No. 23/2023/QH15; traders, business households and individuals with business registration in countries sharing a common border who have been granted a Business Registration Certificate in accordance with the laws of countries sharing a common border.

In addition, Decree No. 122/2024/ND-CP amends and supplements Clause 1 and Clause 3 of Article 21 of Decree 14/2018/ND-CP regulating the entry and exit of people and vehicles of Vietnam.

Specifically, the cargo owner or the person authorized by the cargo owner, the vehicle owner, the driver of the cargo vehicle, the service staff on the vehicle, ship, boat who are Vietnamese citizens shall comply with the provisions of the international treaties to which the Socialist Republic of Vietnam is a member and the Law on Exit and Entry of Vietnamese Citizens No. 49/2019/QH14, which has been amended and supplemented by a number of articles under Law No. 23/2023/QH15.

In addition to the above-mentioned documents, vehicle drivers must also have a vehicle operating license appropriate to the type of vehicle being operated.

Vehicles, drivers of cargo transport vehicles and business entities of Vietnam are allowed to pass through border gates and border openings prescribed in this Decree to enter or exit border markets of countries sharing a common border, and must be subject to inspection and control by specialized management forces at the border gates and border openings.

The Decree also states that in 2029, the Ministry of Finance shall report to the Government for consideration and decision on adjusting the number of tax exemptions and the amount of tax exemption for imported goods in the form of buying, selling and exchanging goods by border residents.

From January 1, 2029, when conducting cross-border trading and exchange of goods, border residents must be present to complete import and export procedures.

From January 1, 2030, goods can only be processed for import and export at international border gates; main border gates (bilateral border gates); secondary border gates; customs clearance routes, specialized roads for transporting goods at international border gates, main border gates (bilateral border gates); border openings that have completed the procedures for opening and upgrading border gates and border openings according to current legal regulations and have reached bilateral agreements on allowing the export, import and exchange of goods.

Decree Decree No. 122/2024/ND-CP takes effect from December 1, 2024.

Source: https://congthuong.vn/nang-cao-hieu-qua-cua-hoat-dong-thuong-mai-bien-gioi-351015.html