Approach strategy of the seafood industry when implementing UKVFTA

UKVFTA helps the seafood industry increase its competitiveness in the UK market. Photo: Nguyen Hien

Competitive advantage

Mr. Nguyen Hoai Nam, Deputy General Secretary, Vietnam Association of Seafood Exporters and Producers (VASEP), said that the advantage that UKVFTA brings is that the main products of the seafood industry enjoy 0% import tax to the UK, especially key products such as shrimp and pangasius. Currently, shrimp accounts for 70% of Vietnam's total seafood export turnover to the UK, followed by pangasius, accounting for 20%.

According to Mr. Nguyen Hoai Nam, this is a very impressive number, since if looking at the single market, the UK is the sixth largest market for Vietnamese seafood. Although not yet in the billion-dollar club, after 9 months, the growth of seafood to the UK is about 8% compared to the same period, higher than the average of other markets. This is an effort of the business community, but at the same time it is also thanks to the positive impact of the UKVFTA, mainly thanks to taxes.

Exporting Vietnamese goods to the UK has a competitive advantage over other markets, because markets such as India, Indonesia, Thailand... do not have FTAs ​​with the UK, but, VASEP representative said that to better take advantage of the tariff incentives from this Agreement, businesses need to be ready and proactive in sourcing raw materials. At the same time, focus on improving quality and supply capacity to increase market share in this market.

Sharing about the approach and search for information on this market, Mr. Nguyen Hoai Nam said that the first advantage is that the updates, awareness, and minimum regulations related to the UK market are not much different from the EU market. These are the basic regulations on food safety, traceability, implementation of social responsibilities or resource responsibilities... which are basically the same as when the UK was still part of the European Union. Enterprises have had many years of trading and exchanging to meet the requirements of Europe, and have a relatively good understanding of this market to proactively plan for farming, exploitation and export.

In addition, in the past, VASEP has regularly supported the seafood business community to increase market share in this region. First of all, it is necessary to regularly update information related to regulations on IUU (control of illegal exploitation). Because if Vietnamese enterprises do not promptly update market adjustments, they may face disadvantages when exporting to the UK market, as well as the European market.

At the same time, post market information on the association's electronic information portal for seafood businesses nationwide to access and learn about import market regulations, including the UK market.

In particular, VASEP has a relationship with Seafish (the British Seafood Federation), which has a similar function to VASEP. Seafish regularly provides great support to the seafood industry, including to consumers. In addition to the official channel of the UK Government, seafish.com.org is a useful channel for businesses to have more information about consumer trends to orient their products.

Increasing the strength of the support mechanism

To improve the effectiveness of the strategy as well as the way to find market information, the representative of VASEP said that it is necessary to have the companionship and support from the policies of the Government and ministries.

“The agreement is a necessary condition, the sufficient condition is that the internal legal processes and reform of administrative procedures and administrative regulations will make Vietnamese enterprises more competitive,” said Mr. Nam, adding that competitiveness is created from capital, from regulations that help enterprises have more strength to fulfill orders or provide more difficult orders or larger orders.

To better exploit the UK market, Mr. Vu Viet Thanh, Department of European - American Markets (Ministry of Industry and Trade) said that first of all, enterprises need to look up and thoroughly understand information about the market. Some transparent and useful sources of information for Vietnamese enterprises are the UK Government's trade data system, business and tax data system, etc. through the UK Department of Business and Trade's platforms (gov.uk) and the ITC trade map search tool; as well as market information through the Ministry of Industry and Trade's FTA Free Trade Agreements Portal, the website connecting Vietnamese enterprises with foreign distributors.

In addition, to improve competitiveness, enterprises need to strictly control the entire production process, ensure traceability, ensure food hygiene and safety; at the same time, increase the application of science and technology, develop production systems, and deep processing to increase the competitiveness of goods in one of the world's leading large consumer markets. At the same time, enterprises should also pay attention to carefully assessing information about enterprises and partners before signing contracts or doing business.