The EVFTA Agreement took effect from August 1, 2020, which is a favorable factor for Vietnam's seafood exports in the last months of 2020. Especially products that enjoy 0% tax as soon as the agreement comes into effect such as black tiger shrimp, frozen white-leg shrimp, and processed squid and octopus.

Positive recovery momentum

In recent months, due to the impact of the Covid-19 pandemic, Vietnam's seafood export activities have faced many challenges. In particular, the pandemic has had complicated developments in Vietnam's major markets such as the US, EU, Japan, China, etc.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the Covid-19 pandemic has caused a sharp decline in seafood consumption, changes in consumption trends, and a decrease in orders of 35% to 50%. In addition, social distancing has caused domestic production and international trade to stagnate, businesses are short of raw materials for processing, transportation and payment difficulties, leading to a lack of capital to maintain and restore operations.

Meanwhile, the restaurant and service sectors have also been disrupted, causing seafood consumption in this segment to decrease significantly, leading to a simultaneous decrease in seafood product prices on the world market. Prices of key products have all decreased, causing a sharp decline in revenue for exporters.

However, the efforts of enterprises to overcome difficulties and restore production activities have brought positive results to this industry in recent months. According to statistics from the General Department of Customs, in July 2020, the country's seafood export turnover reached 796.3 million USD, up 0.8% over the same period in 2019. Thus, seafood exports in July continued to recover after increasing by 0.3% in June 2020.

In the first 7 months, seafood export turnover reached 4.4 billion USD, down 6% compared to the same period in 2019. In particular, the US continues to be a potential market for Vietnam when exports to this market increased by 20.8% compared to July 2019, reaching 184.35 million USD. Seafood exports to the EU market during this period also showed signs of improvement when they only decreased by 2.3% compared to July 2019, while the decrease in previous months was over 18%. Seafood exports to the Japanese market are still facing difficulties and exports to China have decreased again.

According to VASEP, the Covid-19 pandemic is still complicated in the world and continues to affect Vietnam's seafood exports. However, it is forecasted that seafood exports will gradually recover in the third and fourth quarters of 2020, with the entire year's export turnover likely to reach 8.26 - 8.3 billion USD, down 3.8% compared to 2019.

Local efforts

Binh Dinh is considered one of the localities with outstandingly developed fisheries industry, contributing a large output to Vietnam's fisheries industry.

Since the beginning of the year, the total output of exploitation and aquaculture of Phu Cat district (Binh Dinh) alone has reached more than 30,100 tons, reaching nearly 70% of the plan and increasing by 3,700 tons over the same period in 2019.

To achieve the target of total fishing and aquaculture output in 2020 of 43,000 tons or more, in the coming time, Phu Cat district will continue to strengthen inspection, review, consolidate and establish new solidarity groups and teams at sea; promote the development of offshore fishing vessels to increase efficiency and output; encourage fishermen to arrange fishing activities based on each fishing ground where aquatic resources appear to save costs, reduce fuel consumption and achieve high efficiency.

According to Vice Chairman of Binh Dinh Provincial People's Committee Tran Chau, the local fisheries industry has grown remarkably, always playing the role of a spearhead economic sector of the locality with the value of fisheries production increasing by an average of 6.3 - 6.5%/year; exploitation increasing by 9.4%/year, aquaculture increasing by 7.6%/year.

The implementation of policies to support fisheries development helps fishermen develop offshore fishing fleets to increase economic efficiency and contribute to protecting the sovereignty of the sea and islands of the Fatherland. Currently, Binh Dinh has a fleet of more than 6,000 fishing vessels operating in fisheries exploitation. Of which, more than 3,000 fishing vessels with a length of 15m or more operate in offshore areas. The output of exploited fisheries reaches 200 - 230 thousand tons/year; the output of ocean tuna alone reaches 10,000 - 13,000 tons/year.

To promote the value of the collective brand name Binh Dinh Ocean Tuna, which was certified by the National Office of Intellectual Property in 2018, Binh Dinh has effectively implemented the chain of exploitation, purchase, processing and consumption of tuna of the Ministry of Agriculture and Rural Development and has been supported by the Japan International Cooperation Agency (JICA) in the model of applying exploitation technology, helping fishermen improve product quality.

Mr. Chau said that the locality currently has more than 4,000 hectares of shrimp farming area. Of which, more than 2,000 hectares are high-tech shrimp farming areas invested by enterprises. People have gradually applied science and technology in white-leg shrimp farming, integrated aquaculture, freshwater, saltwater and brackish water aquaculture, bringing high economic efficiency. In the field of aquaculture, white-leg shrimp farming has the highest added value, accounting for 84.7% of the total aquaculture value and 11.3% of the total added value of the aquaculture sector. Quality-assured aquaculture products have contributed to increasing the value of the seafood processing and export industry. Up to now, the whole province has 5 enterprises operating in seafood processing and export with a total turnover of about 400 million USD/year.

In particular, in fishing activities, the People's Committee of Binh Dinh province has assigned the Department of Agriculture and Rural Development to preside over and coordinate with the Provincial Police, the Provincial Border Guard, and local authorities of coastal areas to strictly enforce the Fisheries Law and regulations against illegal, unreported and unregulated fishing (IUU fishing); ensure the operation of the task force to control fishing vessels entering and leaving ports, loading and unloading of products, certifying and confirming the traceability of aquatic products. Strengthen the management of fishing vessel activities in the locality, in order to prevent and put an end to the situation of Binh Dinh fishing vessels violating foreign waters and violating IUU fishing.

As for the People's Committees of coastal districts, towns and cities, in addition to promoting the dissemination of the Fisheries Law and IUU regulations, it is necessary to strengthen coordination with relevant agencies to request administratively sanctioned ship owners to comply with the sanction decision. If the ship owner does not comply, enforcement will be organized according to regulations. Any locality that still allows fishing vessels to violate foreign waters will have the local leaders responsible before the Chairman of the Provincial People's Committee...

With the positive recovery momentum of the seafood industry, according to VASEP, there are still optimistic signs for exports as retail sales in the world market remain stable or increase for frozen, canned, marinated and smoked seafood with longer shelf life.

In particular, the EVFTA Agreement took effect from August 1, 2020, which is a favorable factor for Vietnam's seafood exports in the last months of 2020. Especially products that enjoy 0% tax as soon as the agreement comes into effect such as black tiger shrimp, frozen white-leg shrimp, and processed squid and octopus.

Source:

Chi Thien. “The seafood industry overcomes the ‘Covid-19 storm’”. Banking Times, January 9, 2020. http://tapchitaichinh.vn/tai-chinh-kinh-doanh/nganh-thuy-san-vuot-bao-covid19-327340.html.