Since the US introduced the tax policy for steel products under Section 232 up to now, the wave of trade defense has become a measure to protect domestic production in many markets around the world and create a Great difficulty for exporting countries like Vietnam.
According to the Vietnam Steel Association, from the beginning of 2019 until now, the export steel output has decreased by about 50% and the average price has dropped to about 650USD/ton, down more than 12% compared to the same period last year. On the contrary, the whole country has spent over 5 billion USD to import steel of all kinds, increasing sharply in volume and value times. In particular, goods originating from China imported to Vietnam accounted for over 42% of production and accounted for about 40% of total iron and steel import turnover of the country.
Meanwhile, the domestic production is in a strong surplus as more and more steelmaking plants are licensed to build and go into production in the past year.
Regarding export activities, Vietnam still exports to familiar markets such as Cambodia, Malaysia, Indonesia, … remote markets such as USA, Mexico, and EU still export but the quantity is very small due to Trade defense policy of these markets.
With the domestic supply exceeding demand, the Ministry of Finance and the Ministry of Industry and Trade have proposed raising the import tax (MFN) of HRC to 5% instead of 0% as before to prevent Chinese goods from entering Vietnam. However, this proposal was canceled because it was not practical.
Currently, the application of trade defense to protect the domestic market is an action that many countries choose because they can both protect domestic production and do not go against the spirit of WTO.
It is possible that in the near future, the Department of Trade Remedies may apply more trade remedies when the world trade war situation is increasingly tense.
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Ms Lan – Juridical Manager of MRS Steel