Rice exports to the EU: To enjoy the 0% tax rate, there must be a stable growing area

The EU is a large and potential market with a consumption of about 2.5 million tons / year in the period 2016 - 2020. With Vietnam, we have exported rice to the EU for many years, but the output is not worth it. and only accounted for nearly 11 million USD in 2019. Our company alone, every year, only exports about 2,000 tons of premium rice to EU countries.

Before EVFTA took effect, each ton of rice in Vietnam had an average price of about 600 USD / ton, subject to import tax of about 15%, bringing the price up to 700 USD / ton. Meanwhile, the lower selling price of Thai and Cambodian rice in this market makes it difficult for Vietnamese rice to compete with the rice of these countries.

Now, when EVFTA comes into effect, the EU gives Vietnam a quota of 80,000 tons of rice / year, including: 30,000 tons of milled rice, 20,000 tons of unmilled rice and 30,000 tons of fragrant rice. The EU will fully liberalize broken rice, helping Vietnam export about 100,000 tons to the EU annually. For products from rice, the EU will bring the tax rate to 0% after 3-5 years. Thus, when Vietnamese rice is no longer subject to tax rates, it will lower prices and compete better in the EU market.

Basically, I agree with the terms and contents that the Decree builds such as: Enterprises that export fragrant rice to the EU want to enjoy the preferential quota of 30,000 tons / year tax-free must be certified for the type of rice. aromatic by the Department of Crop Production. Testing to be conducted from the field, 20 days before harvest and the purity of the seed (% of plants) should not be less than 95% ...

However, in my opinion, to do thoroughly, we need a mechanism to manage and tighten the quality with the pesticide trading companies. Accordingly, products related to the environment, human health must be banned, because if they are forced to grow by households or businesses, it is not reasonable.

First of all, enterprises must meet the criteria for control of pesticide and fertilizer residues. Besides, the most important factor to be in the duty-free quota is that the enterprise must have a stable planting area; proving the origin of the product and closely monitoring it from the beginning until it comes to the type of rice that meets the EU's requirements. With these requirements, for a long time, we have done through building a 250ha rice material area that meets strict EU standards.

In addition to the above factors, businesses must pay attention to the issue of honesty. Specifically, when completing procedures with European partners, they will put up a long list to fill in information about products such as growing areas, varieties, growing techniques, food hygiene and safety, human rights. and policies for employees. They appreciate the integrity of the business, so there will be no checks at first. Only when we bring the goods through, they will start checking and just violate a request, they will conduct investigation. When investigating the results of dishonest businesses, the partner will return the shipment and list the business on a "black" list, which means that the business opportunities in this market will end. This means, in order to stay strong in the EU market, we have to meet the criteria they set out from the start and businesses need to strictly comply with those requirements.