Trade remedies help the national sugar industry

VIETNAM, January 6 –

The tariff reductions for sugar imported into Việt Nam under the ATIGA have created difficulties for domestic sugar cane production. Photo congthuong.vn

HÀ NỘI – Trade remedies have helped the domestic sugar production industry recover and farmers stabilize production, experts say.

Nguyễn Văn Lộc, general secretary of the Việt Nam Sugar Cane Association, said that in 2020, Vit Nam started reducing import tariffs to 5% on ASEAN sugar in accordance with ASEAN Trade in Goods Agreement (ATIGA). This saw a rapid increase in sugar imported from Thailand.

In 2020, sugar imported from Thailand reached nearly 1.5 million tonnes, an increase of 330% compared to 2019.

The sugar imported from Thailand in large volumes and at low prices has affected the domestic sugar production industry.

This volume of imported sugar completely dominated the local market and forced the price of local sugar to drop to a low level.

The low price forced farmers to reduce the cultivation of sugar cane and switch to other crops, leading to a reduction in the area under cultivation of sugar cane.

Meanwhile, a high sugar stock due to falling sugar prices has put factories at risk of shutting down.

As a result, Việt Nam’s sugar industry is in danger of being wiped out.

According to the association, after the implementation of ATIGA, Việt Nam had only 30 active factories and 11 factories were forced to close. Of the 30 factories in operation, 17 are operating at a loss.

About 3,300 workers lost their jobs and 93,225 farm households were affected due to difficulties in the national sugar industry.

As a result, six sugar factories represented by the association have applied for the application of anti-dumping and anti-subsidy measures to cane sugar products from Thailand.

After a thorough investigation, the Ministry of Industry and Trade imposed on June 15, 2021 the anti-dumping duty of 42.99 percent and the anti-subsidy duty of 4.65 percent on cane sugar originating in Thailand.

The application of trade remedies resulted in a 75 percent drop in sugar imported from Thailand.

This slows down the unfair competition of Thai sugar for the domestic industry, thus helping to increase the price of locally produced sugar.

The purchase price of sugar cane from farmers has also increased, from 100,000 VNĐ to 200,000 per tonne.

This is an effective solution to gradually restore the raw material areas and reduce the pressure on the national sugar cane companies.

Lộc said the trade remedies reduced Thai sugar’s unfair competition with local sugar products, thereby helping to raise the price of domestically produced sugar cane, saving a series of sugar cane factories and stabilizing the market. sugar cane production for farmers.

“Since the decision to apply the trade remedies to Thai sugar, local sugar cane companies have determined that it is time for them to restore production. Therefore, Sơn Dương Sugar and Sugarcane JSC has continued its investment policies and increases the purchase price of sugar cane for farmers, ”said Nguyễn Hồng Minh, General Manager of Sơn Dương Sugar and Sugarcane JSC.

“The higher purchase price has left farmers reassured about the restoration of the raw material areas. Now, if the market is stable, sugar factories will recover and expand production in the next 3-4 years.”

However, there are signs of tax evasion, anti-dumping and anti-subsidy in other ASEAN countries other than Thailand, Minh said.

Therefore, the company is proposing to the state to apply trade remedies for sugar from ASEAN countries.

Chu Thắng Trung, deputy director of the Trade Remedies Department, said that the sugar production industry is one of the industries with regional and global market integration, so the industry knows that there are trade remedies. which can be applied to protect the legitimate interests of manufacturing. industry.

Trung said that in the context of liberalization and globalization, more and more countries are reducing tariffs, especially when participating in free trade agreements.

This reduces import taxes on many items and even eliminates them altogether, creating more and more competition between imported and domestically produced products.

“The application of trade remedies aims to ensure a fair competitive environment between imports and domestic products. For domestic sugar processors and the industry itself, they need to improve their competitiveness to compete with imported products, ”Trung said.

According to Trung, so far Việt Nam has conducted trade remedy investigations in a total of 25 cases, including 15 anti-dumping cases, six self-defense cases, one anti-subsidy case and two tax evasion cases.

Among them, most of the cases concerned metal products such as steel and steel products. There are also a number of cases related to timber, sugar and other items. VNS

Rachel J. Bradford