FOREIGN TRADE UNIVERSITY
FACULTY OF INTERNATIONAL ECONOMICS
---------***--------
RESEARCH PAPER
ANALYSIS OF VIETNAM’S AGRICULTURAL EXPORT
SUBSIDY
Group: 4
Class: KTEE316(HK1-2324)1.1
Model: International economics 2
Module instructor: Prof. Tu Thuy Anh
No.
Full name
Student ID
1
Vũ Hữu Bình
2112450017
2
Nguyễn Hoàng Dương
2112450023
3
Nguyễn Anh Đức
2112450025
4
Nguyễn Diệu Linh
2112450050
5
Trịnh Tuấn Thành
2112450089
Hanoi, September 2023
Abstract
On 7th November 2006, Vietnam became the 150th member of the World Trade
Organization (WTO). In such a large, worldwide playing field where the economies have
been focusing on integration via agreements and commitments such as the removal of
tax barriers on many trade products, Vietnam has to face tremendous challenges. We
had to address many issues, including questions such as the tariff regime and our
protectionism policies, mainly involving agricultural and industrial subsidies.
One of the hardest challenge that Vietnam had faced was regarding agricultural
production support and export subsidies for the sector as the Agreement of Agriculture
(AoA) requires countries to make commitments to reduce trade-distorting subsidies.
Despite those challenges, we have come a long way in gaining the world’s trust as a
reliable, transparent and fair trade partner. Vietnam has been on our track in the process
of economic integration and trade liberalization and had made great progress, especially
in the agriculture sector, one of the most important sectors in our economy.
Given those facts, this study aims to conduct a theoretical research on the history of
Vietnam’s agriculture export subsidies and commitments made to reduce subsidies. The
data and information was collected through related previous research documents and
articles and websites on the Internet and with the result of our research, we hope to
recommend some policies on regulating trade policies for the government.
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1. Introduction
Vietnam has focused heavily on the process of economic integration and trade
liberalization, especially in 2007, when we officially became a member of the World
Trade Organization (WTO). Since then, Vietnam has taken part in many bilateral and
multilateral free trade agreements (FTAs) with other countries and regions, namely the
Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
This has brought many opportunities for Vietnamese firms and producers to export the
goods to the global market. However, joining the WTO and signing FTAs means that
we also had to face the challenge of liberalizing trade by reducing protections in the
form of tariffs and subsidies.
The agriculture sector is particularly affected since about 30 per cent of Vietnam’s
workforce are employed in this sector and it had a history of being offered protection
from the government in the past. With protections removed in order to join the WTO
and other trade agreements, the agriculture sector faced serious threats as rising import
prices and loss of preferences had darkened the picture of the sector considerably,
placing it at a disadvantagous position.
The purpose of this paper is to research and analyze the history of Vietnam’s
agricultural export subsidy policies, the commitments made to reduce them, how those
commitments affect the agricultural sector and other nations’ views and reactions to
Vietnam’s subsidy policies. From the research, we hope to draw conclusions, lessons
and recommendations for the government in future decisions making.
This paper will be organized as follow:
• Chapter 1: Literature review
• Chapter 2: Overview of Vietnam’s agricultural export subsidy
• Chapter 3: Export subsidies of Vietnam before and after joining the WTO
• Chapter 4: How other countries reacted to Vietnam’s subsidy policies
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2. Literature review
2.1.
Previous researches
Agriculture has always been playing an indispensable role in the Vietnamese
economy, due to the national privileges in terms of climate, land resources and an
abundance of labour forces. It did not only contribute to the country’s food security,
but also be the Vietnamese major export to other foreign markets. In fact, China,
Thailand, and Vietnam are key players in the world rice market in terms of
production and trade (Sina Xie and Artachinda, O. N. 2014.). In this paper, Sina Xie
and Artachinda had mentioned the rice policy reviews as well as the rice exports
policy of Vietnam, stating a lot of changes in domestic policies and government
incentives in rice exports. During the period of 1995, rice export tariff was removed
and by 2001, export quota was also abolished. Farmers and rice exporters were also
given credit assistance, ranging from 0 - 50% of the previous rate (FAS, 2006). This
research had brought the overview of the rice production’s status and export in
Vietnam and proposed some proper measures for policy implications, thereby
restating the importance of government in terms of rice production.
In the broader context of agriculture export subsidies, the system of decrees and
policies to support the production, processing and export of agricultural products has
recently been implemented synchronously across Vietnam, playing an important role
in promoting the development of agricultural production. The agricultural
restructuring policy has reoriented the form and mechanism of agricultural
production development on large-scale, linked and developed along the value chain.
In order to attract investment in agricultural development, policies on taxes, fees,
credit, insurance, linkages, trade promotion, and application of science and
technology were ratified, specifying subjects and levels of support for the production,
processing and export of agricultural products.
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The promulgation of the policy decree has contributed to giving Vietnamese
agricultural products a position in the international and regional markets (Đinh Cao
Khuê , Nguyễn Thị Thủy, Trần Đình Thao, 2020). According to this research, the
upbringing of export subsidies policy had brought the production value per hectare
from 43,9 million VND in 2008 to 91,9 million VND in 2018, with the investment
inflows to the agriculture sector rose by 25,3% in 2019, comparing to the previous
year. The amount of exports was recorded at the highest in 2018 (40,3 billion USD),
ranked the second in SouthEast Asia, 13th in the World. (Niên giám thống kê, 2019)
The Agriculture Policy Monitoring and Evaluation 2020 by OECD has dug deeper
into the supporting policy of Vietnamese agriculture on many diverse instruments. It
shedded light on the taxation subsidies for agricultural producers, with discounts on
land tax and other equipments’ tax. Vietnamese rice farmers also received an area
payment with an amount of money granted on every hectare of paddy field since
2012. The payment was approximately VND 10 million/ha/year, except for upland
fields, and VND 5 million/ha/year for wet paddy land.
The government also imposed some degrees of control over rice exports, to ensure
specific milling and storage requirements, and these administrative functions were
assigned to the Vietnam Food Association (VFA)
OECD (2020), “Producer and Consumer Support Estimates”, OECD Agriculture statistics
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In addition, this paper looked at the details of rice exporting criteria, in order to meet
the global standards and satisfy the requirements of many global Free Trade
Agreements. In 2018, the Vietnamese government implemented the export
conditions for rice exporters. Firms must have at least one storage and one milling
facility that meet national standards and regulations, which can be either owned or
leased. Following that, a reservation of 5% of the total volume exported must be
maintained within 6 months.
2.2.
Research gap
Although these previous had depicted a pretty clear picture of the Vietnamese
agricultural system and the exporting incentives by the government, they still lacked
an insight into the drawbacks of these implementations. The event of Vietnam
joining the WTO (World Trade Organization) had caused multiple changes in the
export subsidies, requiring the flexibility of the Vietnamese government to
encourage agricultural exports without violating the terms of WTO. While existing
studies have touched upon the broad impacts on exports and the trade dynamics,
there is a need for more in-depth investigations into the specific crops and other
negative consequences regarding each exporting item, with the threat of price
dumping in developed countries. Therefore, it is urgent to provide a more
comprehensive assessment of both the benefits and drawbacks of Vietnam
agricultural export subsidies. Understanding how they influence other trading
partners in the international market will be crucial for policymakers seeking to bridge
the gap of interest conflict between parties and pave the effective way for Vietnamese
products to the foreign market. Addressing these gaps will provide a more holistic
view of the complicated relationship between Vietnamese export subsidies and the
integration in international markets.
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3. Overview of Vietnam’s agricultural export subsidy
3.1.
Definition
Export subsidies refer to the granting of support by governments to some beneficiary
entity or entities to achieve export objectives. When the price of foreign goods is
lower, local producers can't afford to compete with foreign producers. In such a case,
the government steps in and supports local companies with regulatory, monetary, or
tax incentives to bring the price down to the level of foreign companies, incentivizing
local producers to export more goods and services.
3.2.
Types of export subsidy
The government can implement export subsidies through 4 main types of policies:
• Regulatory: Making production cost lower by regulating certain industries,
which enables local companies to compete with foreign companies and
increase the level of exports.
• Direct payments: The government can make direct payments for a part of the
production cost that a company faces, which would lower the price of the
goods they are selling and increase exports.
• Tax: By lowering the taxes paid by the companies they are aiming to support
in increasing exports, affected companies production costs would be lower
and they are incentivized to produce more.
• Low-interest loan: The government can also choose to extend low-interest
loans to the companies which they are aiming to help export more. Lower
loans means less interest payment, which would help decrease the price of the
goods and increase exports.
3.3.
Functions of export subsidy
Export subsidies work by reducing the price paid by foreign importers, resulting in
domestic consumers paying more than foreign consumers. This creates a gap
between the domestic price and the world price, which encourages domestic
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producers to sell more of their goods abroad and earn higher profits. The reduction
of price in foreign markets also means an increase in demand for the subsidized
goods in these markets, which can raise the world price and benefit other exporters.
3.4.
Advantages and disadvantages of export subsidy
The use of export subsidy can bring about a mixed result with both advantages and
disadvantages to be considered:
- Advantages
• Lower cost of production: The main advantage of export subsidies is that it
lower production cost of local companies and incentivize them to produce and
export more.
• Boosting economy growth: As local companies are able to produce with less
cost, they can expand their production through increasing production scale,
hiring more workers, which creates jobs and boosts the local economy.
• Increase merchandise supplies: Governments want their population to have
more access to goods and services. Therefore, the government can provide an
incentive that could be in the form of a tax credit or even straight up cash.
Markets that have positive externalities are usually the ones that receive such
benefits.
- Disadvantages
• Inflation risk: A rise in subsidy leads to workers looking for more salary. Once
the salaries in the subsidized sector are greater than everywhere else, it drives
other workers to demand higher pay, which is then reflected in pricing,
resulting in inflation elsewhere in the economy.
• Increasing goods price: Because export subsidies aim at only increasing the
number of goods exported, it is more profitable for producers to export their
products than selling it domestically. This shrinks the local supply and makes
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goods more expensive for local consumers. The local companies will continue
to sell foreign goods for as long as the price at home is below the price they
sell abroad.
• Higher tax: In order to aid some specific industries, the government needs to
lower the tax on these industries or give them direct payments. This will
eventually result in the imposing of higher tax in other financial sectors to
compensate for the export subsidy.
3.5.
Large country export subsidies welfare effects
To analyze the welfare effects of export subsidies in large countries, we will assume
that the market is open to only 2 countries, importing and exporting countries.
At first when both countries engaged in free trade, the world price was at PFT. When
the exporting country implements an export subsidy, production increases which
makes the domestic price increase to PEX. The surplus products are exported to the
other country, which drives the world price down to PIM due to the export amount of
the exporting country must equal to the import amount of the importing country.
Then, we can create a table showing the change in welfare of both countries:
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Importing country
Exporting country
Consumer surplus
E+F+G
-(a+b)
Producers’ surplus
-(E+F)
a+b+c
Government expenditure
0
-(b+c+d+f+g+h)
Total surplus
G
-(b+d+f+g+h)
World welfare
G-(b+d+f+g+h)
From the table, we can conclude that although the importing country gains from the
export subsidy, the exporting country has a deadweight loss of -(b+d+f+g+h), which
means that the world welfare also suffer a loss due to the policy.
4. Export subsidy policies in Vietnam before and after joining the WTO
4.1.
Before joining the WTO
In the end of the 20th century, there were difficulties that made development in the
agricultural sector staggered. The difficulties include urbanization, disproportionate
zoning activities, and abandoned land areas. The government had provided support
to this sector to stabilize production and boost growth of Vietnamese agriculture.
Export subsidies were part of that support. In 1998, the Ministry of Finance had
issued circular 83/1998/TT/BTC, which states that fruits and vegetables exporters
are allowed to refund special consumption tax on exported fruits and vegetables
products. Additionally, the government also established an Export Reward Fund
(ERF), issuing rewards to firms that exceed export turnover, therefore stimulating
production and exports.
According to decision 65/2001/QD-BTC in 2001 of the Ministry of Finance, bonus
contingency had been paid to firms that exported the following products: rice, coffee,
pork, canned fruits and canned vegetables. This policy was expanded in 2002 to
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include beef, poultry meat; fresh, dried and semi-processed fruit and vegetables;
peanuts and pepper.
In 2002, Vietnam issued the first offer on goods and services to the WTO, and began
bilateral negotiations. From this point on, Vietnam started gradually removing export
subsidy policies as
the offer changed to fit the requirements of the WTO.
Government support moved to trade promotion instead of focusing on direct payment
to export firms. The export bonus policy had been amended between 2003 - 2004
into basing the bonuses on annual turnover rather than on export turnover. At this
point, the largest subsidiary rates were applied to pork (6%), and fruits and
vegetables (3%). Even so, this subsidiary only had small economic impact. The
common subsidiary policies used nowadays are associated with exemptions on fees
or taxes.
4.2.
Joining and after becoming a member of WTO
Vietnam became the 150th member of the World Trade Organization (WTO) on
January 11, 2007.
• Benefits for Vietnam
Successfully joining the WTO gave Vietnam an economic expansion, which
came in the form of signing different free trade agreements (FTA). Specifically,
15 FTAs have been implemented, including 2 new FTAs being the European
Union - Vietnam Free Trade Agreement (EVFTA) and the Comprehensive and
Progressive Agreement for Trans-Pacific Partnership (CPTPP), 2 FTAs under
negotiation (EFTA FTA - Free trade agreement between Vietnam and the EFTA
bloc (including four countries Switzerland, Norway, Iceland, and Luxembourg)
and Vietnam - Israel FTA. WTO and FTAs bring many opportunities for Vietnam
to increase trade, attract foreign investment, and help domestic businesses
participate in the global value chain and production network.
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According to the WTO's 2020 World Trade Statistics Review Report, among the
50 countries with the world's largest trade in goods, Vietnam had the largest
growth rate, moving from 39th position in 2009 to 23rd in 2019.
(Unit :million USD)
In terms of FDI, Vietnam has become one of the most attractive investment
destinations in the world. After joining the WTO in 2007, Vietnam welcomed a
registered FDI capital of 3 times that in 2007. Along with participating in FTAs, Vietnam
continues to steadily attract a large amount of FDI over the years. Especially in 2020,
Vietnam entered the top 20 countries attracting the most FDI in the world, ranking 19th,
up 5 places compared to 2019. In 2006, the total export value was 3.9 billion USD. It
increased by 9 times until 2022, reaching 35 billion USD.
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• Policies Vietnam has to follow
Under WTO’s regulation, the reduction commitments are shown in the schedules of
WTO Members on a product-specific basis. For this purpose, agricultural products was
initially divided into 23 products or product groups, such as wheat, coarse grains, sugar,
beef, butter, cheese and oilseeds.
The list of reduction commitments covers most of the export subsidy practices which
are prevalent in the agricultural sector, notably:
- Direct export subsidies plans based on export performance;
- Sales of non-commercial stocks of agricultural products for export at lower prices
than comparable prices for such goods on the domestic market;
- Producer financed subsidies, mainly government programs that create a levy on all
production which is used to subsidize the exportation of a certain percentage of that
production;
-Cost reduction measures such as subsidies aims to reduce the cost of marketing
goods for exporting. This can include upgrading and paying for the costs of international
freight.
- Internal transport subsidies applying to exports only products, mainly those
designed to transport products to one central point for shipping;
- Subsidies on incorporated products, in other words subsidies on agricultural
products such as wheat contingent on their incorporation in export products such as
biscuits.
Upon joining the WTO, Vietnam bound the agriculture export subsidies at zero
according to the Schedule of Concessions and commitments on Goods. At the same time,
Vietnam aimed to maintain balance between Vietnam's rights and obligations while
following WTO rules, by removing official export subsidies for agriculture products.
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After joining the WTO, Vietnam saw an improvement in trade liberalization and
economic integration. This can be seen through the numerous free trade agreements with
other countries in the region, such as: Vietnam-ASEAN-China; Vietnam-ASEANJapan; Vietnam-ASEAN-EU; Vietnam-Korea; Vietnam-EAEU; an the Comprehensive
and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Since joining the WTO, the simple average most-favored nations (MFN) tariffs on
agricultural imports decreased from around 25% in 200 to 16.4% in 2017, compared to
a simple average bound tariff of 19.1%. The highest decrease in tariffs are from the
countries or regions which signed free trade agreements with Vietnam. For instance, the
average tariff is 3.4% from ASEAN member countries and 5.4% from China.
-Vietnam has implemented trade liberalization through multilateral, regional, and
bilateral trade agreements. Being a member of ASEAN, Vietnam supports trade
liberalization between ASEAN and major trading partners in the region, including
China, Japan, India, Korea, Australia, and New Zealand.
-Being a ASEAN member as well as the WTO, Vietnam also takes part in supporting
trade liberalization between ASEAN and major trading partners such as China, Japan,
India, Korea, Australia, and New Zealand.
-The economic integration also led to Vietnam joining the CPTPP in 2018. From this
agreement, Vietnam removed 21.94% import tax on livestock products, 76.39% of tariff
lines aiming to be reduced to 0% after 2 to 16 years.
-One of the latest and significant partnerships that Vietnam joined was the European
Union-Vietnam Free Trade Agreement (EVFTA), which took effect in 2020. For this
agreement, Vietnam removed 31.82% of tariff lines of livestock products; 6 tariff lines
for quotas to poultry products; the remaining tax lines were to be reduced to 0% after 3
to 9 years.
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4.3.
Reactions from other countries
Some member countries of WTO were concerned over the use of agricultural export
subsidies by Vietnam even after accession to the WTO. Many countries have decided to
individually put countervailing cases against Vietnam exports in foreign markets,
particularly imposing an anti-subsidy tariff against Vietnam’s exports.
4.3.1. The case of US’ Anti-dumping measures on Certain shrimp from Vietnam
The US Department of Commerce (USDOC) initiated its “Certain Frozen
Warmwater Shrimp from Vietnam” (“Shrimp” for short) investigation in January 2004 and
issued an anti-dumping order in February 2005.
In the “Shrimp” proceedings, because Vietnam has been designated by the USDOC
as a non-market economy ("NME"), therefore the USDOC applied a regrettable
presumption that all companies within Viet Nam are basically a single operating unit that
works under the government’s protection and, thus, should receive a single anti-dumping
duty rate (the "Viet Nam-wide entity rate"). Vietnamese producers/exporters who does not
want to have this rate applied to them had to pass a "separate rate test" to receive a different
rate from the Viet Nam-wide entity rate. Those producers/exporters who never established
that they had passed the test received the Viet Nam-wide entity rate of 25.76%.
On 20 December 2012, Vietnam requested the establishment of a WTO panel to
make claims to justify three major administrative concerns:
• The use of the zeroing method in calculating the dumping margins;
• The rate that was assigned to many Vietnamese producers who did not
manage to pass the test and establish independence from government control
and thus were considered by the USDOC to be part of the "Viet Nam-wide
entity";
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• The USDOC's failure to remove the anti-dumping order regarding some
respondent Vietnamese producers/exporters who have established themselves
indepenent from government control.
Moreover, Viet Nam also makes claims with respect to the USDOC's likelihood-ofdumping determination in the context of the sunset review.
During the case, Vietnam requests that the Panel exercise its discretion under Article
19.1 of the Understanding on Rules and Procedures Governing the Settlement of Disputes
(DSU) to suggest that the United States revoke the anti-dumping duty order. After
throughout research and consideration, the Panel issued its Final Report to the parties on 4
September 2014, agreeing to exercise their discretion in the manner requested by Vietnam,
advising the US to drop the anti-dumping rate against Vietnam. The anti-dumping rate was
dropped by the U.S. in November 2015.
4.3.2. Escalation of trade dispute from dumping
However, the case against Vietnam’s shrimp export mentioned above its one of the
only few cases where it ended up in our favor. A long list of other products exported by
Vietnam such as copper wire, steel plates, wood products,… to the US and other nations
in the world still suffered from the anti-dumping tax rate due to mistrust between us and
other countries. Although Vietnam has made significant progress in the development of
its exports during the past ten years, however, as its exports rise, Vietnam is now having
to deal with more anti-dumping claims in various overseas markets, particularly after it
joined the WTO in 2007. Started mainly by the EU (10 cases), US (3 cases), India (3
cases), and some minor cases from Turkey, Canada , Peru , South Korea, Argentina,
Poland, and Columbia, there were 28 anti-dumping cases brought against Vietnamese
exports as of May 2008. 23 of them have reached resolution, while 5 are being looked
into. Among the 5 major cases, one was started by the US over uncovered inner-spring;
three by India on CD-R, flat yarn of polyester, and fluorescent lamp; one by Turkey on
gas lighter. The export of Vietnam frequently depends on commodities like shrimp, fish,
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footwear, and other industrial goods that are the subject of anti-dumping proceedings.
Anti-dumping lawsuits against Vietnam are frequently brought into lawsuits against a
number of other Asian nations, including China, Thailand, and India.
This was because due to small-scale productions, Vietnam has to sell its products
at low price in global markets and this has exposed Vietnam producers to dumping suits.
• For example, despite the significant growth in bilateral trade, the relationship
between the US and Vietnam was occasionally disrupted by trade disputes,
most notably over catfish imports. The Catfish Farmers of America (CFA)
became concerned about declining profits due to increased catfish imports
from Vietnam and therefore lobbied the US Department of Commerce to
impose a ban.
• The CFA alleged that Vietnamese catfish was raised under unhygienic
conditions in the Mekong River and that Vietnamese farmers did not comply
with strict food safety regulations. The CFA later accused Vietnam of
“dumping” its catfish in the US market at a lower price due to government
subsidies. Hanoi vigorously protested all such claims, arguing that these
actions represented unfair and protectionist trade practices. Despite
Vietnam’s objections, the CFA won its case in 2003, resulting in tariffs of up
to 64 percent on Vietnamese catfish. A quality inspection requirement for all
catfish production also subjected Vietnamese catfish to costly inspection
rounds.
• However, the dispute did not lead to a setback in bilateral relations, thanks
to a convergence of strategic interests between the two countries in
countering China in the South China Sea. Furthermore, bilateral trade
continued to expand, with Vietnam posting an even higher trade surplus with
the United States.
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This particular aspect of bilateral trade became more contentious during the Trump
administration, which pursued a highly protectionist trade agenda for the US. During his
2017 visit to Da Nang, President Trump emphasized that “the United States will no longer
turn a blind eye to violations, cheating, or economic aggression.” In his meeting with
Vietnam’s President Trần Đại Quang, Trump emphasized that “all countries must play by
the rules” in trade and he was “seeking two--way trade with Vietnam that will benefit both
countries”. Concerned about Trump’s tariff threats, Vietnam quickly offered to buy more
US goods and services, including high--profile deals with General Electric and Boeing to
purchase aircraft engines and technologies, power generation, and services. Yet, Trump
continued to attack Hanoi on the trade deficit, branding Vietnam as “the single worst
abuser” in trade during an interview with Fox Business News in September 2019.
On October 2020, the United States Trade Representative (USTR) initiated two
investigations on Vietnam’s acts, policies, and practices related to the export and use of
illegal timber and currency valuation under Section 301 of the 1974 Trade Act. In
December 2020, the US Department of the Treasury had identified Vietnam as a currency
manipulator.
5. Recommendations for Vietnam
Dealing with anti-dumping problems is a complex challenge that requires a multi
faceted approach. Vietnam, like many other countries, can take several measures to
address and mitigate the impact of anti-dumping actions:
• Strengthen Compliance with WTO Rules: It is absolutely necessary that we
ensure our trade policies and practices are consistent with the rules and
regulations of the World Trade Organization (WTO).
• Transparency and Data Gathering: Improving data collection and
transparency in trade-related matters can make it easier to defend against antidumping allegations with accurate and comprehensive information.
• Product Diversification: Encourage diversification of exports by exploring
new markets and products. Reducing dependence on a narrow range of
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products and export destinations can make it less vulnerable to anti-dumping
actions.
• Strengthening Domestic Industries: The government should support domestic
industries to enhance their competitiveness through non-protectionism means.
Investments in technology, innovation, and quality improvement can help
reduce the likelihood of dumping allegations.
• Trade Promotion and Market Diversification: Actively promoting Vietnamese
products in international markets and diversifying export destinations can
help us to establish strong trade relationships with multiple countries,
therefore reducing dependence on a single market.
• Engagement in Dialogue: We should engage in constructive dialogues with
trading partners and importing countries to address concerns before they
escalate into anti-dumping cases.
• Monitoring and Documentation: Firms and production units should
continuously monitor trade practices and gather evidence to document
compliance with fair trade practices. This proactive approach can help counter
anti-dumping claims.
• Government Support: Firms and companies should collaborate closely with
the government to develop policies and strategies aimed at addressing antidumping issues.
• Regional and Bilateral Trade Agreements: Leverage regional and bilateral
trade agreements can secure preferential market access and trade protection
for Vietnamese products.
• Capacity Building: Government investment in building the capacity of
relevant government agencies responsible for trade policies and dispute
resolution will ensure that they have the necessary expertise to handle antidumping cases effectively.
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• Advocacy and Public Relations: Engage in public relations efforts to explain
Vietnam's trade practices and commitment to fair trade, both domestically and
internationally.
• Alternative Markets and Supply Chains: Consider diversifying supply chains
and exploring alternative markets to reduce vulnerability to anti-dumping
measures.
• Dispute Resolution Mechanisms: Make use of dispute resolution mechanisms
under the WTO or through bilateral negotiations when anti-dumping actions
are unjustified.
However, we need to keep in mind that addressing anti-dumping issues can be a
lengthy and challenging process. Vietnam should adopt a proactive and
comprehensive strategy to protect its interests while promoting fair and open trade
practices. Additionally, seeking support and advice from international trade
organizations can be beneficial in navigating these complex issues effectively.
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6. Conclusion
In this study, we have examined the history of Vietnam’s agricultural export subsidy
policies and how other nations reacted to such policies. Vietnam has provided the
agricultural sector with protections in the form of tariffs and subsidies prior to joining the
WTO in order to nurture and develop the relatively under-developed sector. However as
we joined the WTO in 2007, such protectionism policies had to be removed almost
entirely, leaving the agricultural sector in a vulnerable position.
The agriculture sector in Vietnam mainly comprised of small-scale production units
in the form of family production, therefore it is extremely difficult to match the strict
requirements from other nations and regions to import goods into their countries. Because
of this fact, it is imperative that we have to merge these small-sacle production units into
large, controlled, tightly regulated production units that is capable of producing highquality products that can match the expectations of the importing countries.
Ever since we joined the WTO, the Vietnamese economy has rapidly opened up to
the world, embracing the global playing field. For the entire economy in general and the
agricultural sector particularly to thrive in such a booming and volatile market, we need
to ensure that we play by the rule, strengthening our own production so that we can better
compete with other nations with better technology and resources.
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