Safeguard investigations tend to increase

SGGP
Experts said that trade remedies tended to increase, at the seminar on the impacts of safeguard measures in 2019 and the policy trend on trade remedies after the EU-Vietnam Free Trade Agreement (EVFTA) held by the Ho Chi Minh City Centre of International Integration Support on October 2.

Components manufacturing for export at a mechanical enterprise in Ho Chi Minh City. (Photo: SGGP)

Components manufacturing for export at a mechanical enterprise in Ho Chi Minh City. (Photo: SGGP)

According to Mr. Nguyen Phuong Nam, Deputy Director of the Trade Remedies Authority of Vietnam, the trade policies of countries over the past years tend to be contradictory. On the one hand, many countries, including Vietnam, have accelerated trade liberalization by signing and participating in bilateral and regional free trade agreements. On the other hand, the trend of protectionism in the world is increasing, especially the use of trade protective measures, such as anti-dumping, anti-subsidy, and safeguard, as a tool to prevent imported products. Besides, new practices for the prevention of origin fraud and the evasion of trade remedies tend to be applied more to protect domestic production.

Currently, there are 193 trade remedy cases on Vietnamese export goods. In the past five years, there have been 91 cases, mainly with the US, India, Turkey, and the EU markets, causing some export items to suffer high tariffs, affecting the export turnover of the whole product range. From the beginning of this year, although trade activities have been sluggish due to the Covid-19 pandemic, the number of trade remedy investigations has increased significantly. At present, Vietnam is facing 27 trade remedy cases. The problem is that the knowledge level of Vietnamese enterprises is limited, especially small and medium-sized enterprises. Specifically, among 13 export items of Vietnam that had been warned, up to 4 items were investigated and sued by partners. The latest survey by the Vietnam Chamber of Commerce and Industry shows that 15.09 percent of enterprises do not know anything about trade remedies; 63.21 percent of enterprises have heard of, but do not know about trade remedies clearly; 19.81 percent of enterprises have studied cursorily; only 1.89 percent of enterprises have studied relatively carefully about trade remedies.

To minimize the risk of facing safeguard investigations, enterprises need to build a legal department, study regulations on trade and international trade remedies, or receive advice from lawyers knowledgeable about international law. On the other hand, it is essential to build an advanced and modern management system to keep records and documents fully and clearly.

By Thuy Hai – Translated by Bao Nghi

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