Negotiating to open more official-quota import and export with China

An overview of the meeting.

A series of challenges for unofficial-quota export

The latest data from the General Department of Customs shows that in the first two months of 2022, the total import-export turnover of Vietnam-China agricultural, forestry and fishery products reached more than US$1.83 billion, down by 1.7% compared to the same period in 2021. In which, exports reached US$1.3 billion, down by 7.4%; imports reached US$515 million, up by 16.6%.

Previously, in 2021, the total import-export turnover of Vietnam-China agricultural, forestry and fishery products reached US$12.6 billion, up by 18.39% compared to 2020.

Speaking at a meeting of the Ministry of Agriculture and Rural Development with a number of ministries, sectors and businesses on the situation of importing and exporting agricultural products to the Chinese market on March 9, Nguyen Quoc Toan, Director of the Department of Agricultural Product Processing and Market Development, said that currently, unofficial-quota exports to China are facing many challenges.

The import of items that are not on the list of official exports is considered smuggling and faces confiscation of goods, arrest, fines and prosecution.

Besides, the preferential border trade activities of 8,000 yuan/person/day for border residents are more strictly controlled in terms of goods type and quantity per delivery.

China tightly controls the border gates and the openings, it has deployed 2.5m high barbed-wire fences and installed surveillance cameras in many places.

"Therefore, some commodities (such as durian and passion fruit) that are still exported through the trails and openings by the method of exchanging border residents, can no longer be imported into China," Toan said.

Notably, the leader of the Department of Agricultural Product Processing and Market Development said: “China continues to strictly manage traceability, strengthen and tighten border import and export management for agricultural products and fruits of Vietnam.”

Some agricultural products of Vietnam such as pomelo, coconut, passion fruit, whip, durian, cassava chips and black grass jelly are difficult to export in the form of border crossing at the auxiliary border gates that China previously allowed.

China continued to implement the "Zero Covid-19" policy, tightened control and prevention of the Covid-19 pandemic on packaging of agricultural products, and limited the amount of customs clearance.

This causes congestion at the border gate area with China. Sometimes, the customs clearance was stopped at some border gates due to the detection of Covid-19 on people and goods.

Open more official export channels via sea

China is the leading export market of Vietnam's agricultural, forestry and fishery products. In order to remove difficulties in exporting to this market, gradually "eliminating" congestion of goods at the northern border gates, switching from unofficial to official export is crucial.

From a business perspective, Nguyen Thi Tuyet Ngoc, Director of Vietnam Agricultural Products Chain Joint Stock Company, said that if she wanted to switch from unofficial export to official export, product quality is the top factor.

China has been an important export market of Vietnamese agricultural products for many years. Photo: N.H

Many Chinese enterprises are willing to pay 100% of the money immediately, but they require good product quality. Vietnamese enterprises must have a chain of links and stable supply. That means businesses must have signed contracts with farmers in the off-take of products.

Besides, another important factor is to promote deep processing. Fresh agricultural products, especially fresh fruits, brought to the border gate only to wait for 5-10 days, exporting in the form of unofficial quota will be depressed or even not sold. Meanwhile, if intensive processing is promoted, it will be much less passive.

“For example, China is a popular market for dried lychees. If Vietnam has enough deep-processing enterprises to deploy and export dried lychees instead of fresh exports to China, the pressure on consumption will be greatly reduced," Ngoc added.

Regarding the orientation and roadmap to change the export of agricultural products from unofficial-quota to official-quota in the future, the Ministry of Agriculture and Rural Development has determined that it will propose to the Ministry of Industry and Trade and the Ministry of Foreign Affairs to coordinate with ministries and branches to strengthen negotiations on opening more border gates for customs clearance and official import and export.

It will open more official channels of export through railways and seaways; and cooperate to modernize infrastructure and connect border provinces with China.

At the same time, it is proposed that the Ministry of Industry and Trade coordinate with ministries, branches and border localities to modernize and digitize the market information system to promptly provide localities and business associations with information about demand, price and policy changes of the Chinese market; develop trading floors and forms of e-commerce for agricultural products exported to China.

“The Ministry of Agriculture and Rural Development will also coordinate with ministries and branches to negotiate to expand the list of agricultural products and the list of enterprises that officially export to the Chinese market; develop a project on sustainable agricultural, forestry and fishery exports to the Chinese market in the current context," the representative of the Ministry of Agriculture and Rural Development stated.