Trade remedies should protect business interests

Data from the Vietnam Steel Association (VSA) show that Vietnam produced nearly 15 million tonnes of steel products in 2015, up 21.5% year on year, and sold almost 17.9 million tonnes (including imported products), up 26% annually.

However, the steel industry faced 12 trade-remedy and anti-dumping lawsuits in its export markets last year. It also witnessed an influx of more than 13 million tonnes of imported steel products, worth VND201,002 billion, compared with 2.8 million tonnes of exported steel, worth VND44,667 billion.

With export destinations to be expanded in 2016, Vietnam's steel industry will have more opportunities to ship its products overseas and reach its target growth rate of 15 to 20%.

Nguyen Phuong Nam, deputy director-general of the industry and trade ministry's Vietnam Competition Authority, said when Vietnam boosted its exports, its exports markets would consider that a threat to their domestic industries and thus enhance trade remedies. Even some ASEAN nations such as Malaysia, Thailand and Indonesia have launched trade-remedy lawsuits against Vietnam.

He said although Vietnamese businesses were not strong and experienced enough, they were still capable of coping with trade remedies. Enterprises should co-operate with foreign agencies and be patient, when the agencies consider imposing trade remedies, or else these remedies would be levied immediately.

VSA Chairman Ho Nghia Dung said steel firms should prepare their personnel and data for possible lawsuits that they would face or launch.

He said a sudden and abnormal surge in billet and long-steel product imports recently had seriously damaged the domestic steel industry. Many companies have requested that the competition authority should impose trade remedies at a proposed tax rate of 45% on steel billets and 33% on long-steel products.

However, some steel companies said trade-remedy lawsuits would impact their own benefits.

Le Minh Hai, chairman of the board of directors of the Vietnam – Germany Steel Pipe Joint Stock Company, said he supported trade remedies when local billet factories were able to ensure sufficient billet supplies.

In reality, the domestic billet output is not enough to meet the production demand, and imported billets are cheaper, making it easier for Hai's firm to buy foreign products. If trade remedies are applied, imported billet prices will rise, forcing Vietnamese companies to raise their product prices, which will affect buyers.

He said while trade remedies were essential and legitimate, the VSA and its members should discuss how to launch the remedies at appropriate levels and suitable points of time, since the interests of one company were also associated with those of other firms.

The proposed tax rate of more than 40% on imported billets is too high. A rate of 15 to 16% should be more reasonable, compared with the current nine%, to ensure benefits for all enterprises, Hai said.