456 percent punitive tariffs!Vietnam has hit Chinese exporters with emergency new rules

- Aug 12, 2019-

Affected by a trade war with China, many Chinese exporters of foreign trade, the intention of forwarder and customs clearance practitioners through southeast Asian countries, use of third party entrepot trade to hedge their exposure to the us tariffs, which, through Vietnam, labeled "made in Vietnam" label is a common choice, but as Vietnam, there is this idea seems doesn't work.

Vietnam customs instructions

Recently, Vietnam's ministry of industry and trade issued criteria for "made in Vietnam" (origin), apparently to prevent some companies from using Vietnam to export to the United States.

What does "made in Vietnam" mean?It is understood that "made in Vietnam" can be originated in Vietnam's agricultural products and resources;Products finally completed in Vietnam, according to the international HS code standard, must include at least 30% Vietnamese local value added.Simply put, 100% imported raw materials must be added 30% of the value in Vietnam before they can be exported under the label made in Vietnam.

For example, in the hanoitimes, Khaisilk, a local silk brand in Vietnam, labels Chinese silk scarves as Made in Vietnam and exports them overseas. Asanzo, a TV company, will import components from China, assemble them in Vietnam and export them in the country of origin Made in Vietnam.These two companies violate Vietnam's law of origin.

It is understood that the reason for Vietnam's move may be pressure from the United States.

China's exports to the United States fell 13.9 percent in the first three months of 2019, while Vietnam's surged 40.2 percent in the same period.If Vietnam's exports to the United States grow at this rate throughout this year, Vietnam will overtake Italy, France, the United Kingdom and India to become one of the largest sources of imports to the United States. It can be seen that Vietnam gains a lot from the trade friction between China and the United States.

Source: U.S. census bureau

The reason for this rise in such a short period of time is self-evident, presumably due to a lot of Chinese goods disguised as Vietnamese products sent to the United States.

In this case, the United States must not be happy.

This was not the case in May, when the us Treasury put Vietnam on a "currency manipulator" watch list, but that did not seem to placate the us, which said on July 2nd that it would impose punitive tariffs of up to 456% on some steel products from Vietnam.

Vietnam's exports to the us are expected to continue to surge in the second half of 2019 as the trade war between the us and China drags on.At the same time, Vietnam will be more strict in the management of Made in Vietnam's origin.

Here, also reminds the general Chinese foreign trade enterprise attention!If you want to legally pass through Vietnam, you must abide by the new Vietnam origin policy!Achieve 30% of the added value requirements!