Seafood Exports to Africa: Much Potential but also More Difficulty

In the last 5 years, seafood has always been one of the leading export items of Vietnam into African markets, especially catfish, shrimp, tuna etc. According to the Africa, West Asia and South Asia Market Department (Ministry of Industry and Trade), in 2012, Vietnam exported these commodities to 25 countries in Africa with a turnover of nearly US$150 million, up 38 percent compared to 2011. In the first quarter of this year, the value of seafood exports to Africa reached US$30.3 million, up 15 percent compared to the same period last year.

The importers of seafood from Vietnam include Egypt (US$79.6 million), Tunisia (US$11.16 million), Nigeria (US$11 million), and Algeria (US$9.5 million). Some other countries such as Algeria, Morocco, Nigeria and South Africa mainly import frozen catfish fillets. Shrimp is also present in the African market, but the quantity and value are still small.

However, trading seafood in the African market faces difficulties namely the far distance; inconvenient traffic; transport by sea taking about 40 days, and having no direct flights.

According to the Africa, West Asia and South Asia Market Department, to boost seafood exports to Africa, the first thing that the Vietnamese enterprises have to do is to ensure stable export quality to keep prestige for clients, avoiding the difficulty when authorities of the host country check the quality standards of food hygiene and safety.

In addition, enterprises should actively participate in the survey group market, trade promotion, the international specialised workshops and exhibitions, business forums by the trade promotion agencies in the country to find a reliable partner. These businesses need to have linked price to build distribution networks in a number of key markets, avoiding dumping to win customers.

Solvency of the majority of African importers is quite low and sometimes fraud occurs via the internet trade in some West African countries, which lead to psychological concerns for Vietnamese enterprises. Countries such as Morocco, Egypt, Algeria, and Nigeria, etc. apply high tariffs, requiring some paperwork to confirm consulate (Egypt), Certificate of Standards Organisation of Nigeria Conformity Assessment Programme (SONCAP) for imported seafood. So Vietnamese enterprises have to actively contact the Vietnam Trade Office in Africa, such as in Algeria, Egypt, Morocco, South Africa, Nigeria etc to find out information and import partners. Vietnamese enterprises should also limit finding and dealing with unfamiliar customers through the Internet.

For commercial contracts, the terms of a contract by Vietnam are often poorly drafted and do not clarify the responsibilities of each party so they often get troubles by partners when dispute occurs. When negotiating and signing contracts with African partners, Vietnamese businesses should choose the reasonable method of delivery and payment to avoid the non-receipt of goods by importers to put pressure on prices. The contract must clearly define agency that resolve dispute (arbitration or court) to serve as a basis for resolving the dispute arises.

Finally, businesses should consider combining seafood export with raw seafood import from potential countries as South Africa, Mozambique, Ghana, Mauritius, Tanzania, Morocco and Uganda to serve the needs of processing for exports. In fact, in 2012, Vietnam imported about US$4 million of these goods from Africa.

In addition, countries such as Morocco, Egypt, Algeria, Nigeria ... apply high tariffs, require some paperwork to confirm consulate (Egypt) and certificates of SONCAP for imported seafood.