AsemconnectVietnam - Vietnam’s seafood exports face additional hurdles due to COVID-19.

The country’s exports of seafood products is projected to face numerous challenges over the coming year following a sharp decline during the first two months of 2020, largely as a result of the negative impact of the novel coronavirus (COVID-19) epidemic.
According to the statistics figures released by the Vietnam Department of Aquatic Products Processing and Development, Vietnam’s seafood exports in the first two months of this year suffered an annual fall of 15.9 per cent to 932 million USD.

The negative impact of the COVID-19 epidemic has led to seafood exports to foreign markets decreasing sharply in comparison to the same period last year, of which several markets saw a plummet in export value, including China with drops of 43.48%, the Republic of Korea with a fall of 31.53%, the United States with a decrease of 26.34%, whilst those to Japan declined 28.16%.
According to the Ministry of Agriculture and Rural Development (MARD) reports, the the agricultural sector is poised to face a number of hurdles in the near future. Challenges include the impact of climate change that causes prolonged drought and saltwater intrusion in the Mekong Delta region, along with the “yellow card" given by the European
Commission to the country’s seafood exports, which has yet to be removed.

Most notably, the complicated nature of developments surrounding the COVID-19 epidemic is anticipated to cause a large impact on the nation’s seafood exports, especially to China, the country’s main importer.
The MARD says despite these challenges, the incentives of new-generation free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the European Union-Vietnam Free Trade Agreement will serve to enhance the competitiveness of local seafood products within the global market.
In addition, the reduction of anti-dumping tax rates in the US market and the US Department of Agriculture’s equivalent recognition of food safety control systems with regards to the country’s catfish products will serve to help local seafood products make further inroads into the market.
In consideration of these factors, the fisheries sector aims to reach an export target of 8.5 million tons of aquatic products, raking in around US$10 billion during the course of the year in the process.

Impacts of Covid – 19 on Vietnam’s shrimp exports
Vietnam’s shrimp industry has not faced a great impact from the novel coronavirus -caused acute respiratory disease (COVID-19) because now this industry is under production and Vietnam will enter its shrimp harvesting crop in August.
Vietnam Association of Seafood Exporters and Producers (VASEP) said that many large markets have reduced shrimp imports from China due to the COVID-19 outbreak in this country. That has brought an opportunity for Vietnamese shrimp enterprises to increase their exports to those markets.
VASEP said that with the current difficulties due to the pandemic, especially in China, shrimp production, processing and export enterprises have changed their business plans to expand export markets.

Now, the local businesses focus on improving their competitiveness and producing shrimp for export after the pandemic, said VASEP.
Mr. Ho Quoc Luc, Chairman of the Board of Directors and General Director of the Sao Ta Food Joint Stock Company, said in the long term, Vietnam will take a lot of advantages from the EU-Vietnam Free Trade Agreement (EVFTA) to increase shrimp exports to the EU.
The association said that EU is Vietnam's largest shrimp export market, accounting for 20.5 percent of the total shrimp export value.

According to the EVFTA, the tariffs of most raw shrimp, including fresh, frozen and chilled products, imported from Vietnam into the EU will be reduced from the basic rate of 12-20 percent to zero as soon as the agreement comes into effect, expected this year. Meanwhile, import tariffs on processed shrimp will fall to zero after seven years.
The reduction of anti-dumping tariffs in the US market to zero would promote growth in Vietnamese shrimp exports to this market. Now, the US is the second largest export market of Vietnamese shrimp, accounting for 19.4 percent of total export value, it said.
Bui Ba Su, Deputy General Director of the Vietnam-Australia Seafood Corporation, said farmers should rear shrimp at present to meet higher demand after the pandemic.
At the same time, the farmers should produce clean shrimp and ensure traceability for their product to enjoy preferential tariffs under the EVFTA and increase exports to Europe, he said.

Mai Ngoc Son, Director of Quy Nhon Frozen Joint Stock Company also noted that to take advantage of the EVFTA, local businesses must renew technology and improve product quality.
Besides that, the Import-Export Department under the Ministry of Industry and Trade noted that Vietnam's shrimp industry will continue to face fierce competition in the world market because more countries have produced shrimp so the price will not see strong growth.

Importing countries have more strict requirements on quality and food safety and those will also affect Vietnam's seafood exports, including shrimp.
When the EU removes tariffs for Vietnamese exported shrimp to this market, it would set up non-tariff barriers. Of which, the EU has a new regulation on banning the use of Ethoxyquin in all kinds of aquatic feed from March 31, 2020.
Local enterprises also need to promote attraction of foreign investment and join regional supply chains so they could take full advantage of the EVFTA, according to the VASEP.
Vietnam has targeted to gain a total export value of 10 billion USD from seafood exports this year, including 4-4.2 billion USD from shrimp exports.
CK
Source: VITIC/Vietnamplus.vn/VOV.VN/VNS