The advantage for seafoodto export into EAEU

Export seafood processing

According to the Vietnam Association of Seafood Exporters (VASEP), the Eurasian Economic Union (EAEU) includes: Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan. Asthe Agreement comes into effect itcreates a commercial boost for Vietnam on access to the market of nearly 200 million people. The Agreement will reduce or be 0% on almost 90% of the import tariffs on the basis of reciprocity. Of which 59% of tariff lines will be reduced as soon as the agreement comes into effect and 30% will be reduced in the transition period.

Seafood is one of Vietnam’s commodities that has advantages when exporting to the EAEU. After the VN-EAEU FTA takes effect, the seafood export tax will immediately be reduced to 0% from the current level of 5.63%. The current average MFN import tax of the Russia-Belarus-Kazakhstan Customs Union for seafood is 10%, this will be reduced to 0%.

However, due to the seafood husbandry of Vietnam now importing a relatively large number of raw materials for processing, preferential tax will apply, so enterprises need to pay attention to meet the original content ratio as prescribed.

The total value of seafood export turnover of Vietnam to the Eurasian Economic Union market (including the countries of the Russian Federation, Armenia, Belarus and Kazakhstan) in 2015, seafood exports to this market reached only $US 84.71 million. In particular, exports to Russia accounted for $US 84,268,789 (down 20.7%), exports $US 439,546 to Belarus (down 87.4%), exports to Kazakhstan decreased by 100%.

According to Customs statistics, in the first eight months of 2016, seafood exports to Eurasian Economic Union market reached $US 51.87 million. In particular, exports of $US 51,557,817 to the Russian Federation (up 4.1%), exports of $US 310,053 to Belarus (down 11.9%), and exports of $US 3,217 to Kazakhstan.

For imported goods, within the Eurasian Economic Union market, Vietnam only imports seafood from the Russia Federation. The total value of imported seafood to Vietnam from the Russian Federation through the official gates in 2015 reached $US 36.46 million, up 12.3% in comparison with 2014.

In the first eight months of 2016, imported seafood from the Russian Federation reached $US 16.02 million (a decrease of 9.1% compared to the same period in 2015). In particular, the major imported commodities such as: different types of imported fish (under code from 0301 to 0305, and 1604, except tuna, catfish) was $US 13.62 million (down 16% compared to the same period in 2015), imported crabs and other crustaceans was $US1.5 million (up 22.4%).

Currently, the Eurasian Economic Union market, including the Russian Federation, is the traditional and potential commodities export marketfor Vietnam. However, in recent years, Vietnam's seafood exports to this market still face many obstacles and encumbrances. As reflected by some enterprise members of VASEP, exporting dried fish products to the Eurasian Economic Union market (including Russia) is very difficult since Russia does not agree with certifications issued by the Vietnam’s authorities that enterprises must meet the specific regulations of this market (this is a difficulty for the small and medium enterprises to export to Russia), as well as the regulations of the Russian market for catfish exports to the Russian Federation (the Russian Federation limits the list of export enterprises to this country).

The VASEP Association and seafood enterprises are asking the Government and the Ministry of Industry and Trade and the Ministry of Agriculture and Rural Development to remove the technical barriers and administrative procedures; proposing the Eurasian Economic Union agreeswith the Vietnam’s authorities certifications for small and medium enterprises to have opportunity to export to this market.