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Vietnam steelmakers must stay alert for trade defence measures
Viet Nam’s steel exports have increased in recent years. As a result, the sector has attracted attention from other countries and triggered a number of defence measures from some markets.
Experts analysed the issue during a conference on Monday, discussing how Vietnamese firms can prepare and mitigate damage caused by trade defence in international trade.
The event was held in relation to a dumping investigation into Vietnamese steel initiated by Mexico in October, which is the first defence measure that has been triggered by a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
President of the Vietnam Steel Association Nghiem Xuan Da said since the CPTPP went into effect in January 2019, Viet Nam’s steel exports have been on the rise. In October this year alone, Viet Nam exported over 700,000 tonnes of steel products worth US$800 million to the Central American country, double the figure recorded in the same period in 2020.
Mexico, as a member of the North American Free Trade Agreement (NAFTA), is a key market for Vietnamese steelmakers for its access to North American markets. As Vietnamese steel finds its way to more markets around the world, Vietnamese steelmakers should expect greater scrutiny from trade defence authorities.
Da said under the guidance of the Ministry of Industry and Trade’s (MoIT) trade defence department, the association has been building its own case to meet demands of the Mexican trade authority.
He said Vietnamese steelmakers nevertheless must pay more attention to their own value chain, prioritise using locally-sourced material, uphold business ethics and improve transparency to minimise the risk of being investigated.
Deputy head of MoIT’s trade defence department Pham Chau Giang said her department was not caught off-guard by the investigation as they have received a number of warnings since last year. A number of Mexican steelmakers filed complaints about Vietnamese steel with their government and expressed opinions that Vietnamese steel could hurt the Mexican steel industry.
In the last two decades, Vietnamese steelmakers have gained valuable experience in dealing with trade investigations and are on the lookout for tips and information for potential suits.
Giang said even in the worst-case scenario in which Mexico imposed an anti-dumping tariff on Vietnamese steel it shouldn’t be set too high that it cripples exports to this market in the short term. She urged firms to always keep their books up-to-date and in proper order in anticipation of requests made by trade authorities.
Dr Hoang Ngoc Thuan from the Foreign Trade University said firms must be well-prepared legally and financially going to court in trade defence suits, especially those in new markets. Thuan advised firms to employ legal teams from Mexico and make sure their accounting is done using internationally recognised standards.
MoIT has been running an early-warning system to inform Vietnamese firms about potential suits. The ministry is also at the ready to provide firms with support should they have to face investigations.
Source: VNS