After the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) becomes effective, it has brought just a few benefits to Vietnam’s shrimp exports, but it is recognized as a vital factor to complete the previous Bilateral and Multilateral Agreements.
In the first four months of 2019, Vietnam’s shrimp exports reached 848.4 million USD, down 16.7% year on year. Such decrease has emphasized the importance of privileged regulations in Free Trade Agreements. CPTPP, which became effective early 2019, has offered either challenges or benefits to Vietnam’s shrimp export to other members.
Japan was the second biggest importer of Vietnamese shrimp in the first four months of 2019, accounting for 19.2% of the total of Vietnam’s shrimp export volume. In February and March, sales in Japan made this country be the unique importers among Vietnam’s main markets to be recognized growth. Besides Vietnam-Japan Economic Partnership Agreement (VJEPA) and ASEAN-Japan Comprehensive Economic Partnership (AJCEP), CPTPP has raised position of Vietnamese shrimp in this market since the effective date in January 2019.
According to commitment of Japan in CPTPP, majority of Vietnam’s seafood including frozen shrimp (HS 030617) and processed shrimp (HS 160521) are imposed tax 0% right after the agreement becomes effective.
Canada is ranked the sixth position among Vietnames shrimp importers, accounting for 4.4% of the total of Vietnam’s shrimp export volume. In the first four months of 2019, sales of Vietnamese shrimp in Canada was 37.6 million USD, up 4.8% year on year. Shrimp exports to Canada has inched up since the effective date of CPTPP.
Among the countries entering CPTPP, Canada is one of the countries offering the market opening policy with the most favorable conditions where thousands of kinds of tax on imported goods become 0% and 95% kinds decrease, covering 78% of total of Vietnam’s export volume to this market. Moreover, Canada is one of three countries that has not entered any bilateral agreement with Vietnam.
As committed in CPTPP, import tax of aquatic products including Vietnam’s frozen shrimps and processed shrimps into Canada all go to 0% after the agreement becomes effective.
CPTPP also offers a chance for Vietnamese shrimp while its competitors like India, Thailand and Indonesia do not enter the agreement.
In recent years, Canadian has consumed more warm water shrimps from Asian countries while cold-water shrimp supply decrease. Sales of Vietnamese shrimps in Canada have ranked the first position and accounted for one third of the country’s import market shares. Such advantage will enable Vietnam to compete against other countries in Canada.
Australia, a member in CPTPP, ranks the seventh position among importers of Vietnamese shrimps, accounting for 4.8% of the total of Vietnam’s shrimp export volume. As committed in CPTPP, all shrimp products imported to Australia are imposed tax 0% after the agreement becomes effective.
Chile, one of CPTPP members, is a small market but offers a chance for Vietnamese shrimps. Chile commits that all aquatic products including shrimps imported to this country will be imposed tax 0% (6% before) after the agreement becomes effective.