CPTPP has not brought much advantages for Vietnam tuna industry

News 09:37 11/07/2019
(seafood.vasep.com.vn) In March 2018, the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP) was officially signed by 11 members, Canada, Mexico, Peru, Chile, New Zealand, Australia, Japan, Singapore, Brunei, Malaysia and Vietnam. This agreement has been ratified by 7 member countries, including Australia, Canada, Japan, Mexico, Singapore, New Zealand and Vietnam and has been in effect since December 30, 2018. Most of these markets are not big markets for Vietnamese tuna so CPTPP has not brought advantages for Vietnam tuna industry.

Of the 7 countries that have ratified the CPTPP agreement, Japan, Canada and Mexico were the three markets currently in the top 10 of the largest tuna importer of Vietnam, other markets were small importers of Vietnamese tuna. According to the statistics of Vietnam Customs, total tuna export value of Vietnam to countries in CPTPP accounted for 12% of total tuna export value of Vietnam in 2018.

According to the commitment, countries participating in CPTPP commit to completely eliminate 97% to 100% of import tariff lines for goods originating from Vietnam, depending on the commitment of each country. Nearly all of Vietnam's goods, including seafood exported other CPTPP countries, shall be fully eliminated tax when the Agreement comes into effect or according to tax roadmap reduction. Specifically, Vietnam's tuna products exported to CPTPP countries are  entitled as follows:

Australia: Tax imposed on tuna products shall be reduced to 0% as soon as the agreement comes into effect (basic tax rate of 0%, except for processed striped tuna HS160414 reduce from 5% to 0%)

Canada: Tax imposed on tuna products is 0% as soon as the agreement comes into effect (basic tax rate is 0%)

Chile: Taxes on tuna products are reduced from 6% to 0% as soon as the agreement comes into effect.

Mexico:  Tax rates for products of loin/fillet frozen tuna HS code 0304 shall be reduced by the 3-year roadmap, from the base rate of 20% to 0%. In addition, processed canned tuna products with HS code 16 shall reduce tariffs according to a 16-year schedule, in which the tax rate shall be kept at the base rate of 20% from the first year to the 5th year and shall be completely eliminated for 11 years from the 6th year. It means that the goods shall be tax free from January 1 of year 16th.

New Zealand: The tax imposed on tuna products shall be reduced to 0% right away the agreement took effect.

Japan: Taxes imposed on fresh/live/frozen tuna (except for bigeye tuna) and canned tuna products (except for loin/fillet tuna HS030487) shall be reduced to 0% as soon as the agreement is effective. Particularly for bigeye tuna, the 3.5% tax rate shall be eliminated in the 11-year period starting from the date of this Agreement took effect for Japan, and shall be exempted from April 1 of the year 11th. Products of loin/ fillet tuna HS code 030487, 3.5% of tax rate shall be removed annually for an 8-year period starting from the date of this Agreement comes into force for Japan, these goods shall be exempt from tax since April 1 of year 8th.

For the most part,  when CPTPP takes effect, Vietnam's tuna products exported to Japan, Mexico and Chile have many opportunities. However, there are also a lot of competition in these market. If businesses are not actively access, they cannot take advantage this opportuinity. Besides, markets like Japan and Mexico are also countries where domestic culturing tuna and fishing industry are very developed, so the market share for tuna import products might not be much.

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