There is a high possibility that China could overtake the U.S. as the biggest importer of Vietnamese tra (pangasius) fish this year, heard a seminar on agricultural and aquatic products in the Mekong Delta city of Can Tho on Tuesday.
The Chinese market has recently accelerated imports of rice, shrimp and pangasius from Vietnam, said Vo Hung Dung, director of the Vietnam Chamber of Commerce and Industry in Can Tho City and general secretary of the Vietnam Pangasius Association.
Pangasius shipments to the northern neighbor accounted for a slight 3-5% of the sector’s total before 2014 but the ratio shot up to 10% in 2015 and 18% last year, resulting in China overtaking the European Union as Vietnam’s second largest importer of the fish after the U.S.
“Given the strong demand, I think China could possibly surpass the U.S. to become Vietnam’s biggest tra fish buyer this year,” he said.
China has huge demand for not only pangasius but also farm goods like rice, sweet potato and shrimp, said Pham Minh Thien, executive director of Co May Trading & Services Co Ltd in Dong Thap Province.
However, uncertainly is what characterizes the Chinese market as Chinese traders can place big orders one day but walk away the next day.
This is why Thien’s company limits tra fish sales to the northern neighbor at 30-40% to reduce risk.
Vietnamese economic expert Le Dang Doanh, who is member of the United Nations Committee for Development Policy, said China is a big market with a population of 1.4 billion people, and may replace the U.S. as the world’s largest economy.
However, he noted, exporting Vietnam’s agricultural and aquatic goods to China is like traveling on a bumpy road.
Vietnam’s shipments to the northern nation are subject to tariffs of 13% to 17%.
Doanh said they should range from zero to 5% as stated in the commitment to the ASEAN-China Free Trade Area, of which Vietnam is a member.
He added other risks include a lack of information, language barrier, payment methods and verification of partners’ capacity.
Vietnam should have experts with a good command of the Chinese language and a good understanding of rules and policies.
“All deals with Chinese traders must have contracts with clear terms on transaction, payment and dispute settlement in line with international practices,” he stressed.
Photo: CBR Investment AG