EXPORTATION OF AQUATIC PRODUCTS TO CHINA MARKET xuất khẩu hoa quả sang thị trường trung quốc

TOPIC: EXPORTATION OF AQUATIC PRODUCTS TOCHINA MARKET Aquiculture has been being an industry which brings the socio-economic effect for the country, and it is also considered as a new in

TOPIC: EXPORTATION OF AQUATIC PRODUCTS TO

CHINA MARKET

Aquiculture has been being an industry which brings the socio-economic effect for the country, and it is also considered as a new industry be focused to develop in the near future, since it shows its important position in National Economy and acts as key industry Aquiculture is primary exportation product of Viet Nam; it approximately makes profit of 2 million USD per year for the country

Viet Nam has been become one of the powerful countries in aquiculture exportation industry Viet Nam aquiculture has much of potentiality and development opportunity: due to natural advantages and geographical position together with suitable policies of the Government and activeness, creation of the thousands of aquiculture production sectors and million of fisher workers During the last years, Viet Nam aquiculture has had stable position in the international market, contributing the economic growth within the country, creating jobs and renewing better life for the people living along the coastal provinces However, our aquiculture industry development only works with fastidious markets such as America, Japan and EU nations without pay enough attention to the other markets in the area, Since the failure of the lawsuit involving to Sutchi catfish and Yellowtail catfish and the recent lawsuit of shrimp product with America market, it should be considered reasonably

in market searching There are many potential markets for our aquiculture to enter into for example China market and Hong Kong Exclusive economic zone are evaluated as potential market for our aquiculture industry The demands for aquiculture industry are getting much higher in species and abundant products, including high value products as raw fisheries to lower value products as fried-fishes Along with 1, 3 millions of inhabitants and great development economy, living life standards of the people are much considerably increasing According to the

research, the Chinese is trending to have more aquiculture products in their daily meals By the way, the Chinese does not highly require in food quality and safety as

in EU nations and America markets China is considered as an easy market, the exportation products rejected by EU due to unqualified wrapping can be accepted to use in this market It can be said that this an essential advantages of the Vietnamese enterprises raising and processing aquaculture products There are a lot of advantages since we enter into China market; it is especially true for aquaculture industry: we can develop our long-term business relationship, the common boundary curve, experiences in aquaculture development, etc Therefore, Vietnam aquaculture is not only be exported to America, Japan or EU markets Over the lasts years, turn- over of Vietnam aquaculture into China has been enhanced, following year is higher than the previous years China market is considered as potential market needed being exploited and developed by our aquaculture To deeply understand the development processes of our aquaculture industry during the last few years, and China market and its important potential to our aquaculture industry

I China market and factors influence on aquaculture exportation to the market.

1 China market.

a Economic characteristics

China has completed its socio-economy system China is a big country having many administrative zones with different characteristics in potential and demands; each area has its own strength China is also a member of WTO and other international organizations

China prioritizes to develop Exclusive Economic zones (EEZ), and these EEZ shall be developed to large commercial areas, advanced outward processing factories, high qualified areas having efficient conveniences and huge international information center in the future

China opens its economic border gates It focus much on developing marginal term of trade China Government renews external trade organizations, makes them

simpler and reduces verbose administrative procedures in order to make exportation activities more convenient Develop to execute active business activities to the localities and practicing trade responsibility system

Renovation of the trade plan institution is by from two-way system to one-way system The government implements relaxing financial foreign trade relations, separate financial obligation between the central and local China has made the distribution of foreign trade profits and large-scale responsibility solutions, put the exchange of foreign currency for the entire export business foreign trade at different levels and the type of in-put profit and exchange profits by basic factor system and contracted sale for the enterprises

b Political characteristics.

China is following the socialist economic institutions Perform three factor theories namely: theory of Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping way China implements the program of multilateralism, diversification of foreign

economic relations and international economic integration initiative Involved in many

of the political and economic organizations in the world, they are expanding and affirming the role of the world's most populous country

c Legal characteristics.

China uses tax tools, export subsidies, financial assistance, exchange rate policy, trade promotion support For the tax, China applied as a tool to protect domestic production

d Characteristics of human culture

Chinese consumers prefer imported products with high technology, although Chinese attaches great importance to domestic goods Imported products are preferred and they still choose to buy imported goods if it is possible, especially the high-tech items

Demands of the Chinese market are quite diverse and the market is considered relatively easy due to the different segments of the population that have different

incomes This market is characterized by the existence of various kinds of goods that have different specifications and quality to such an extent that the price is different of tens or even hundreds of times

Chinese entrepreneurs like "bordering trade" because in this way they are returned the value-added tax to 50%

2 China aquaculture market

a Situation of exploitation and aquaculture in China

After the reforms of the past 20 years, from 1979 to 1999 average output value of China's seafood industry annually increase of 22.25% By 1979 output value of the seafood industry accounts for 0.7 percent of GDP, but by 1999 it had increased to 2.4%, including fishing and aquaculture China's total seafood production in 1999 is over 40 million tons –ranked top in the world

Located in Southeast Asia, with more than 18,000 km adjacent to the Pacific Ocean and including more than 500 large and small islands: China is a country with the potential to develop the world's most modern fisheries Besides it is the most populous country in the world, China can not take fisheries development prop up for billions of people In the past 10 years by priority investment- China has accounted for nearly 30% of the total mining production and global aquaculture Become the world's biggest aquaculture

Moreover in their fisheries development strategy China has confirmed development strategy "go outside" China has signed a number of cooperation agreements on fisheries with other countries For example, the fisheries agreement signed with Myanmar allows Chinese fishing boats in operation in Myanmar seaboard China's guidelines are: At first, they contribute to the partnership, helping partners and after implementation of mutual benefit They say the goal of the Chinese seafood industry is not the protection and rational use of natural resources but also through the partnership of equality and mutual benefit, opening up the use of

fisheries resources of the other countries and customs.

To protect marine resources China has done is planned mining production growth rate by zero Although the country is the world's No 1 seafood exploitation, the country has not increased production since 2000

In China, the government implements a ban on exploitation of marine resources in the South China Sea region, although this region is very important fishing grounds of seafood in China, concentrated in the provinces of Guangdong, Guangxi and Hainan, the annual mining production accounts for 1/3 of the national mining To protect marine resources the Government of this country is carried out to stop exploitation in each sea areas on the appropriate time of the year

b Seafood processing and export situation in China

China is emerging as Asia's largest seafood market and both for importation for consumption in the country and for re-exportation The fishery is developed rapidly but China has yet to ensure individual needs that still have to import as populous rate and consumption is higher than the one of the world on average In 1999, China imported 1.35 million tons of seafood and Chinese seafood imports trend continues

to increase To balance China is very interested in the development of fisheries exports

However, Chinese seafood quality have problems (the amount of microorganisms

or antibiotics exceed prescribed regulations) so the foreign exporters often reject the goods Though a number of seafood processing enterprises has obtained the certificate of HACCP (Hazard Analysis and Critical Control pint), their export products still fail to comply with the requirements of the importing country because the standard import seafood exports of those countries (like Japan, Korea, U.S., EU) are relatively high

According to experts, the main reason of this situation is due to culture fisheries Specifically dirty daily water in cities, industrial waste water has made the access to marine waters contaminated Through testing it was discovered in the seaboard areas near the Chinese shore are usually affected by inorganic nitrogen and active

phosphate Moreover in sea water in the Gulf and seaboard nearby China contain still harmful creature Also in the process of raising seafood, food for shrimp, fish and dirt from shrimp, fish excrete together with chemical drugs make the waters for fisheries contaminated According to the preliminary assessment, mollusk animal per week usually released 6-8 tons of dirt in many places in China, households cage fishes, because they want to make use of the water as much as possible, had arranged cages density and the number of fish in cages as much, causing serious water pollution, poor water quality When a cage is contracted disease it shall be easy to contaminate another cage The cage aquaculture in the high density also causes on traffic flow in aquaculture areas affected making aquaculture environment more polluted, energy circulation is hindered, slow growth rate of seafood and seafood pathogenesis

c Situation of China importation and exportation of seafood

According to the FAO, between 1995 and 1997 world demand for seafood increased by 14 million tons, but since 1997 the fishing output has not increased In the future, the sea is a major source of food supply for human and marine aquaculture industry is an important industry Globalization of the world economy and trade liberalization is an inevitable trend of the development of the world economy After China joined the WTO they have to implement the provisions of this organization and to participate in building the new rules of international seafood trade, to further promote their positive role in economic development of the world Then these commercial disputes related to the WTO rules and standards for production and processing methods PPM will be even more intense In July 1997, on the basis of the report of the World Health Organization's decision, EU ban imported Chinese “ca quat” fish Chinese “ca quat” fish accounted for 80% of the world “ca quat” fish By doing this the EU has caused damages to the European importers and consumers Although the reasons given by the EU is not accurate, but at that time China had not joined in the WTO, therefore the problem has not been resolved properly Through many discussions until 1999, the new EU sent investigation teams to China, and then the import of fish from Chinese fans is restored This demonstrates that, even though

the PPM standard is not very plausible, but it was approved by the developed countries , then China must respect it

After joining the WTO, China will no longer be discriminated against, the administrative barriers that were installed by some countries in trade relations with China will be eliminated, the cost of the purchase and sale of seafood will be reduced China will have chance to import aquaculture skills, and advanced processed aquaculture of the foreign countries, improve labor productivity in the fisheries sector, enhance its competitiveness

d Demand, consumer tastes of Chinese seafood

With 1.3 billion people, with diverse demands on seafood such as shrimp, fresh fish, fish fin, abalone, oyster pearl, sea cucumber, cotton scraps, dried squid Especially salted fish consumption is very great in the border provinces

Chinese import demand for its market is great both for consumption in the domestic market and for re-exporting to other countries The cities need to import more lobster, prawn, tuna; squid used for their re-exported policy, China demands

to import more raw materials

e Regulation and management of imported Chinese seafood

China recently launched a series of new regulations, applicable from 30/6 on labeling, packaging and certification of goods inventory, quarantine (The label must indicate the name of the common mode of exploitationimported goods will be returned or destroyed if not coinciding with certificate) makes it more difficult for most of our seafood exports especially with small quota items

According to the signed framework agreements on free trade area ASEAN – China, since 1/7/2003 this country will lower tariffs on imported seafood

products as defined in Chapter 3 For Vietnam's seafood exports to China, China will implement the tariff reductions of about 25% compared to previous time

3 Factors affecting the export of aquatic products into the Chinese

a The favorable factors.

- About the characteristics of the Chinese market: China is a big market, its population accounts for 1/5 of the world population This is a potential market for Vietnamese seafood exports China is on track to economic growth China's demand for seafood increased from low to high quality Subscribe recent years, the observers find out that Chinese meals are

inclined to seafood consumption, per capita consumption in 1998 was 18

kg, 23 kg in 2000 and in 2001 was about 25 - 30 kg This is an open door for Vietnamese seafood to getting easier penetration into the Chinese market Wealthy requires seafood to be "high quality" as they prefer

imported products than domestic products The remaining majority of the Chinese people with average income just need seafood at popular level, totally not strict in product quality, they like eating salted dry products Particularly some provinces in bordering produce salted fish products having special flavor that only the Chinese preferred To seize the demands, production of the items quickly adapts for each consumers, further

penetrates the Chinese market, therefore the value of Vietnamese seafood in China in recent years have always increased years after years

- Geographical location: Vietnam is a country bordering with China having trade relations for a long time, to grasp and understand the characteristics and needs of the Chinese people become easier Vietnam seafood can be transported by both road and sea-route by short time and short distances Vietnam has many economic borders with China, such as: Tan Thanh (Lang Son), Mong Cai (Quang Ninh), etc, especially for the fisheries sector, the Mong Cai border-gate is a key: firstly it is one of the gates where the flow of goods transfer with great speed, secondly Quang Ninh province is a potential seafood province ranked second in the Red River delta

- Economic relations: In November 2002 Asean countries and China have

signed with framework agreement on comprehensive economic

cooperation between ASEAN-China in 2010, according to which "early harvest program" has been signed According to this process since 1st

January 2004 Vietnam and China will reduce the import tax in the

roadmap gradually extended to 2008 Most of the items involved in this program are the agricultural products, vegetables and seafood Since 2002 exported products from Vietnam to China will be entitled to specific average tax rate reduced by 25% in comparison to the previous In March

2002 China made an official report to the Ministry of Trade of Vietnam regarding to that China makes priorities the most favored nation (MFN) to import tariffs in China according to the standards of World trade

organization (WTO)

b Unfavorable factors

- Toward China:

Faced with poor quality of their seafood China should have a transitional period Over the past years the Chinese Ministry of Agriculture has regulations on the protection of aquatic resources, but does not have a complete legal system of import and export seafood

Within 5 years (2001 - 2005) seafood consumption in China may exceed EU and only behind the U.S and Japan These are great opportunities for our country's fisheries sector However, it must be that the market is not without obstacles According to Vietnamese enterprises, the biggest obstacle to trade with China is currently negotiating trade Chinese people have the habit of bargaining very much so the actual "final price" is the starting price for negotiations, this requires expert negotiators have to be very patient, and identify partners whether he is the one giving the final decisions or not

China Currency management is very tight, the number of Vietnamese companies is allowed to pay in U.S dollars is very limited and mostly China is not implementing according to international rules by L / C In terms of the safety in commercial, payment

made by sea-route meets lots of risks Moreover tariffs on goods imported seafood are generally higher than the U.S., Japan and other Asian countries

Despite these obstacles there is not any way to pass over The problem is to study carefully the partners, having a thorough understanding of the business environment to find reasonable mode of behavior to success To conquer the Chinese market, we have

to spend a lot of effort and time to find reliable partners for business, so the Vietnamese seafood enterprises try to have a lot of efforts in accessing, selecting companies, large corporations having enough prestige and commercial capacity to establish long-term trade relations

- Toward Viet Nam:

The biggest obstacle for us is the customs procedures at border areas So far we still have struggled in regulation and policy, not as flexibility as China China is not interested in whether the quota is small or big, despite of the fact that benefits are made They are ready to put mechanisms into difficult place, for example, goods transferred through Bac Luan border-gate are dutiable of 100% then transferred by the river is only 50%

Although Decision 53 create open mechanisms, there are no written instructions, as the result, any items passed over to China by lucky is good, not mentioned to the sudden detention Our mining clearance is limited, while China exported goods can go at any place

Our tax policies have also undermined by the operator, therefore our products are at the China price pressure due to a tumor, causing the Vietnamese enterprises dumping

of ourselves

II. Status of Vietnam seafood exportation to the Chinese market

1 The development of the Vietnamese fisheries sector

a Potential of Vietnamese fisheries sector

 Resource potential:

Vietnam has a long coastline of 3260 km, 12 lagoons, 112 rivers, creeks, of which