Vietnam.- Vietnam has the potential in exporting shrimp to the EU when the upcoming free trade agreement between Vietnam and the European Union (EVFTA) takes effect.
In November 2015, Vietnam and the EU formally concluded the negotiation of the EVFTA Agreement. The text has now been published and the legal review of the Agreement is ongoing. The agreement is expected to take effect in early 2018.
As committed, after the agreement comes into force, Vietnamese goods, including shrimp products, will enjoy special preferential tariffs.
The EU mainly imports frozen raw shrimp and processed shrimp from Vietnam. According to the commitments, as soon as EVFTA comes into effect, the tax of raw shrimp HS code 03061100 (chilled green lobster, HOSO black tiger shrimp, frozen DP shrimp, fresh/frozen PD shrimp, frozen whole shrimp, etc.) exporting to the EU will be subject to the tax of 0% from the current level of 12.5%, the tax of shrimp HS code 03061710 (frozen PD black tiger shrimp, frozen HOSO whole black tiger shrimp, frozen shrimp headed and shell-on, frozen/fresh black tiger shrimp, frozen black tiger shrimp meat, frozen/fresh HLSO black tiger shrimp, frozen/fresh IQF black tiger shrimp, frozen whiteleg shrimp meat, etc.) will enjoy the tax of 0% from the current level of 20%.
Exports of processed shrimp and shrimp products HS code 16052110 (pasteurized shrimp) will be subject to the tax of 0% from the current level of 20% after 7 years from the date of the agreement coming into force; shrimps HS code 16052190 (other shrimps) will also enjoy the tax of 0% from the level of 20% after 7 years from the date of the agreement coming into force.
The EU accounts for about 30.6% of total shrimp import value of the world. EU shrimp imports range from US$6-8 billion per year. In the last 10 years (2007-2016), shrimp imports into the EU increased from US$5.6 billion to US$6.7 billion in 2016.
According to International Trade Center (ITC) data, in the first 10 months of 2017, shrimp imports into the bloc reached over US$5 billion; down 7.6% over the same period in 2016. The UK and France were the two largest buyers of shrimp in the EU. The UK shrimp imports totaled US$700.2 million, down 0.6%; those into France hit US$776.3 million, up 2.6% over the same period in 2016.
According to the data of Vietnam Customs, in November 2017, Vietnam’s shrimp exports to the EU market showed the highest growth among the major importing markets of Vietnam shrimp with a 71% increase to eye US$86.4 million.
The Netherlands, the UK and Germany were the three largest single importers of Vietnam shrimp in the EU. Exports to these three markets grew strongly, in which sales to the Netherlands and the UK rising by 93% and 87% respectively; exports to Germany recorded the 3-digit growth of 114%.
In the first 11 months of 2017, the EU was the largest importer of Vietnam shrimp, accounting for 22.2% of the total value of Vietnam shrimp exports to markets. In this period, Vietnam’s shrimp exports to EU reached US$780.2 million; increasing by 42.4% over the same period of 2016.
EU is a notable importing market of Vietnam shrimp in the first 11 months of 2017 with the high growth and high demand. The value of Vietnam’s shrimp exports to the EU currently reported the positive growth as EU consumers prefer value-added seafood products and increased imports to meet the demand of year-end festivals.
On the EU market, Vietnam has to compete mainly with India and Ecuador. While India tends to reduce shrimp exports to the EU as it is subject to a 50% border check, Ecuador and Vietnam are increasingly boosting exports to this market.
Source: VASEP
