Solutions to Restore Agricultural Exports to Chinese Market

12:18:32 PM | 30/9/2019

Following the declining momentum of 2018, many agricultural products of Vietnam exported to China have continued to experience a worrying decline in turnover in 2019.

Chinese market is increasingly fastidious

Perhaps, stemming from the deep-rooted idea that China is an easy market, Vietnam is still wholesaling to this market through border trade without planning. In 2018, Vietnam's agricultural exports to traditional markets all grew sharply compared to 2017. Only the agricultural exports to Chinese market decreased by 5.5% over the same period in 2017. In 2018, only three agricultural products of Vietnam exported to China had turnovers of over US$1 billion including vegetables, rubber and wood; a decrease of two items compared to 2017 including seafood and rice.

The Ministry of Industry and Trade’s data shows that the exports of agricultural and aquatic products to China reached more than US$3.8 billion in the first 7 months of 2019, down 9.2% over the same period. Among these, rice dropped the deepest at 67.5%, raking in more than US$159.4 million; fruit and vegetables collecting US$1.6 billion, down more than 8%; cassava down nearly 10% compared to the same period earning only over US$466 million.

China is Vietnam's largest agricultural, forestry and fishery export market, accounting for 27% of the country's total export turnover. Therefore, every fluctuation of this market has clear influence on Vietnam's agricultural exports. It also shows the passive nature of Vietnamese enterprises when exporting agricultural products to Chinese market.

For many years, exports of agricultural and aquatic products to China have mainly relied on cross-border trade, customs clearance at border gates without bringing goods into the inland. Therefore, the goods have not met the technical barriers and not formed a sustainable chain yet.

In fact, Chinese market is becoming more and more "fastidious" when changing trade policies and introducing a series of technical barriers on quality control, food safety quarantine, origin of aquatic, agricultural products, and fruits imported into their country. The regulations governing export activities according to Chinese official norms have been issued for a long time. However, in the past three years, China has just implemented this regulation fully and seriously. According to Mr. Tran Thanh Hai, Deputy Director of Import - Export Department (Ministry of Industry and Trade), that is in line with international practices. At the same time, in recent years, China has been increasing investment in agriculture and restructuring the economy; expanding production areas towards localizing and gradually reducing import volumes.

Solution

In order to overcome difficulty exporting to Chinese market, the Ministry of Industry and Trade said that it was necessary to strengthen the management and supervision of goods quality in all stages according to standards and rules in the country and export markets. It was necessary to promote training and replication of agricultural production models in accordance with GlobalGAP, VietGAP, HACCP standards to successfully export agricultural products to this market.

According to Ms. Le Hoang Oanh, Director of the Asia-Africa Market Department (Ministry of Industry and Trade), it is necessary to gradually reduce, then to abolish border trade, focusing on official export, improving quality and design of the product; implementing trade promotion programs in China, and building a channel of consumption and distribution of goods in this market.

Not only China, the major importers of Vietnam's agricultural products such as the U.S, EU, Japan and South Korea are all increasing protectionism for their agricultural products through standards on quality management, food safety and traceability requirements. Ministry of Industry and Trade forecast that the situation of exporting agricultural products in the coming time would still face many challenges, difficult to achieve high growth rates as the same period. The Ministry of Industry and Trade recently issued a handbook "Some information to know when exporting agricultural and aquatic products to Chinese market". This is a practical move to promote the export of agricultural and fishery products to this market.

Nguyen Thanh