Vietnamese seafood has variety of opportunities to RCEP thanks to loosened origin rules

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Seafood is one of the typical industries benefiting immediately after the RCEP Agreement comes into effect. Photo: N.Thanh

Plenty of room to increase exports

According to the Trade Promotion Department (Ministry of Industry and Trade), currently, Vietnam exports seafood to more than 160 markets around the world, of which exports to RCEP member countries account for a large market share (over 63% market share in seafood exports of Vietnam).

Vietnamese seafood still has many opportunities to promote exports to the RCEP market. Mr. Le Hoang Tai, Deputy Director of the Trade Promotion Department. said: “Origin of seafood products was previously required by FTAs. Purely in Vietnam, but RCEP allows breeding, farming in Vietnam and exporting while still enjoying preferential treatment. The RCEP Agreement helps businesses promote the export of seafood products to the member countries' markets, especially when exporting to the markets of leading trading partners such as Japan; Korea, and China, etc. rules of origin are relaxed”.

China is one of the large potential markets for Vietnamese seafood in the RCEP bloc. Mr. Nong Duc Lai, Commercial Counselor, Vietnam Trade Office in China, said China's domestic aquaculture and fishery output currently reaches 64 million tons/year, but consumer demand is up to 67.3 million tons/year. Recently, China's seafood import turnover increased sharply, reaching 3.6 million tons in 2021, worth USD 15 billion, doubling compared to the years 2015-2016.

Notably, Vietnam's seafood exports to China in the first four months of 2022 had remarkable prosperity, reaching more than USD 530 million, up to 100% over the same period last year with main export products including: Pangasius, basa fish, and frozen shrimp.

"The size of the Chinese market is large, consumer demand is diverse while Vietnam has a border with China, so there is still a lot of room for businesses to expand seafood export turnover to this market," Mr. Nong Duc Lai said.

Similarly, Vietnamese seafood also has many opportunities in the Malaysian market. Ms. Tran Le Dung, First Secretary, Vietnam Trade Office in Malaysia said that as a Muslim country, the demand for seafood products is quite large. Currently, Vietnamese seafood accounts for 8.8% of the market share in Malaysia after China, Indonesia, and Thailand. In the first four months of 2022, Vietnam's seafood exports to Malaysia increased by 40.7% over the same period last year.

“This is a very significant number, showing that Vietnam's seafood exports to Malaysia have clear growth prospects. In particular, RCEP facilitates Malaysia's deeper integration into global free trade and investment by eliminating 90% of tariffs between member countries. Therefore, through the Malaysian gateway, Vietnamese seafood can access many other markets," said Ms. Tran Le Dung.

Learn more about the rules of origin

In addition to opportunities and favorable factors, representatives of many Vietnamese Trade Offices in RCEP countries said that this agreement also brings competitive pressures to Vietnamese seafood products. Vietnamese seafood is still mainly exported in raw form; and the value of goods is not high. Furthermore, high prices and unrecognized seafood brands in the world market are also typical weaknesses leading to reduced competitiveness of goods.

According to Mr. Nong Duc Lai, in the future, domestic authorities need to closely monitor the quality of exported seafood. If the goods are not controlled, they will be returned or destroyed.

Along with that, he said: "The work of disseminating and updating information on China's food safety and hygiene regulations should also be promoted. In addition to activities of state management agencies, enterprises should proactively have specialized in staffs who know the local language to monitor and promptly update market information.”

Talking about experiences from the Japanese market case, Mr. Nguyen Manh Dong, Third Secretary, Vietnam Trade Office in Japan. said that. according to Japanese Customs, in 2021, seafood products that Vietnam exports most to Japan, including: frozen shrimp accounting for 22% of total shrimp imports from Japan; processed shrimp accounted for 36% of total imports of processed shrimp from Japan; Octopus accounted for 38% of Japan's total octopus imports. Vietnam's competitors in the Japanese market for shrimp and crab products are Indonesia, India, and China.

“Japanese people are very fond of ready-made and convenient seafood products. In general, Japanese consumers are quite demanding in terms of quality and freshness of seafood. These are the things that seafood exporters must pay special attention to," said Mr. Nguyen Manh Dong.

Mr. Le Hoang Tai further noted that Vietnamese enterprises need to carefully understand the rules of origin, especially the rules of origin that are cumulative within the bloc. At the same time, enterprises need to meet the regulations on sanitary and phytosanitary measures (SPS) and technical barriers to trade (TBT) of importing countries for aquatic products. This is a weakness of Vietnamese seafood.