Sugar enterprises are having a “fever” with ATIGA

Vietnam has the right to apply safeguard mechanism, impose safeguard duties on imported products …

Domestic sugar enterprises are worried about losing domestic market because the time of January 1, 2020 is coming very close. That is the time when free sugar products from ASEAN countries enter Vietnam market with a tax rate of only 0 – 5%.

Under ATIGA commitment, Vietnam must eliminate import quota on sugar from ASEAN from January 1, 2018. However, according to the wishes of the sugar industry, the Ministry of Industry and Trade has submitted to the Government the deferment of Article 20 of the 2-year ATIGA to give sugar enterprises and farmers more time to adapt.

After being approved by the Government, the Ministry of Industry and Trade has sent a notice to ASEAN partners about the suspension of the implementation of Article 20 in the ATIGA Agreement until the end of 2019 for sugar products. At the same time, he affirmed that Vietnam would officially abolish import sugar quotas from ASEAN countries as committed when joining ATIGA from January 1, 2020.

Shortly thereafter, on February 20, 2019, the Ministry of Industry and Trade issued Document No. 1034 / BCT-XNK, requesting the Vietnam Sugar Association to widely announce to member enterprises, as well as farmers. sugarcane to officially implement this commitment from January 1, 2020, so that the parties concerned can formulate appropriate production and business plans.

However, until now, when ATIGA's commitments related to the sugar industry officially take effect only day by day, it seems that domestic sugar enterprises are still passive and have no plan. specifically to adapt to market changes from commitments in ATIGA.

Recently, some sugarcane enterprises have proposed that the Government submit to the National Assembly to apply a 0% value-added tax on domestic sugar products, to stop auctioning the right to use sugar import tariff quotas in 2019 … According to the Ministry of Industry and Trade, many domestic sugar enterprises expect the Government to extend the term of protection …

Specifically, representatives of some sugar enterprises said that the current price of sugar in the world is abnormally low, which is caused by the manipulation, subsidies, and even devaluation of sugar to support the export of sugar. sugar exporter. Sugar producing countries have always sought strict control to ensure stable sugar prices, ensuring the interests of consumers in the balance with the interests of sugarcane growers and enterprises before cheap imported sugar.

Meanwhile, ATIGA is just a common commitment agreement among ASEAN countries, so the implementation of ATIGA's commitments will not change the policies of ASEAN sugar producing and exporting countries.

Typically, Thailand, Philippines and Indonesia. Although these countries always consider themselves to have completed the implementation of ATIGA commitments since 2015, in fact, these countries still apply measures to restrict non-tariff trade to protect domestic sugar industry. As Thailand is taking measures to support the domestic sugar industry by using part of the profits from selling high domestic sugar as a source of subsidies for exporting sugar abroad.

All three countries of Thailand, Philippines and Indonesia still allow enterprises to import sugar from abroad, but these imported sugar will have to wait in the stockpile without being sold to the domestic market unless it has been approved. approved by the authority. Accordingly, the amount of imported sugar is only consumed in the domestic market when there is a shortage of domestic sugar demand and especially only in the off-harvest period.

As such, the door to import sugar under the ATIGA Agreement of Thailand, the Philippines and Indonesia remains wide open but the domestic consumption door is closed. By creating “domestic consumption quotas,” these countries will not violate the ATIGA, but businesses will not import and store goods in the warehouse.

From the above analysis, many domestic sugar enterprises recommend that the Government should consider non-tariff measures similar to those Thailand, the Philippines and Indonesia have taken to protect the domestic sugar industry. If there is no measure to protect the domestic sugar industry, Vietnam still abolishes the tariff quota and applies the tax rate of 0 to 5% for sugar products under ATIGA's commitments. Water must definitely be closed.

In the view of the Ministry of Industry and Trade, these are very difficult recommendations to follow the commitments of international integration. In 2018, when Vietnam informed ASEAN of delaying the opening of the sugarcane market until January 1, 2020, the countries reacted strongly, so this time it could not be delayed any longer.

Also according to the representative of the Ministry of Industry and Trade, how countries like Thailand, the Philippines and Indonesia apply the protection policy in the domestic sugar industry is state management agencies. The Government of Vietnam will have a mechanism to apply trade remedies as well as legal instruments if imported products show signs of negatively affecting domestic production.

Specifically, after opening the market, imported sugar products into Vietnam that pose a serious threat to the domestic manufacturing industry and the interests of domestic people, Vietnam has the right to apply. The defense mechanism is to impose safeguard duties on imported products to protect domestic industries.

According to VnEconomy