ActionAid International, the Fund for Reconciliation and Development, and the Vietnam Fishery Association today warned that the US Department of Commerce's (DOC) preliminary dumping duty estimates for Vietnamese shrimp exports to the U.S. will have grave consequences to Vietnamese citizens who raise and market shrimp as well as to the overall national economy if they remain in place.
The groups strongly criticized the DOC duty levels as unjustified, and urged the U.S. government to re-examine its calculations in the final phase of the DOC investigation.
At the end of 2003, a group of domestic US shrimp producers petitioned the U.S. government to tax their competitors and consumers by placing duties on imported shrimp from Vietnam and five other countries. On July 6, the Commerce Department announced preliminary dumping margins on shrimp imports from Vietnam ranging from 12.11 percent to 93.13 percent.
"U.S. duties on shrimp will devastate Vietnam's economy and the country's ability to improve the lives of its people," stated Dr. Ramesh Khadka, Country Director, ActionAid Vietnam. "With the encouragement of the United States, Vietnam's shrimp industry has been built on free market principles. The shrimp industry is a key component of Vietnam's economy, responsible for creating approximately 3.5 million jobs directly or indirectly in shrimp and shrimp related businesses. In addition, revenues from shrimp exports rank third among all the country's exports, trailing only crude oil and garments."
"Vietnam's shrimp industry is doing nothing illegal," said Dr. Khadka.
"The country has a competitive advantage over US shrimpers because it uses modern aquaculture technology and benefits from favourable natural conditions and low labour costs in farming shrimp. Vietnam produces a quality product that is in great demand in the United States. Moreover, growth industries like shrimp farming are absolutely vital to raising the overall level of economic development in Vietnam and other developing countries. Protectionist tariffs prevent countries like Vietnam from moving forward."
"A recent survey conducted by ActionAid showed that shrimp farming accounts for 50 percent of GDP in some provinces," Dr. Khadka continued.
"More than 44 percent of peasant households in these regions derive their income from shrimp farming. Shrimp farmers obtain credit from banks by mortgaging assets and acquiring credit at standard interest rates. The industry receives no special treatment from the Vietnamese government. These duties will throw many Vietnamese, who have poured virtually all their assets into shrimping in the desire to improve their lives, back into poverty."
"Our survey also revealed that shrimp industry wages are generally higher than overall income levels in Vietnam and salaries at shrimp processing factories are significantly higher still," said Dr. Khadka. "Shrimp farmers and processors earn a decent wage in Vietnamese terms that allows them to support their families."
"If these dumping duties remain, millions of Vietnamese will suffer," he continued. "Forty-five percent of shrimp exports go to the U.S., making it Vietnam's largest market. ActionAid along with other humanitarian and international donor organizations has been working to better the lives of the Vietnamese people through fair market initiatives. Shrimp farming is more profitable and less physically rigorous than cultivating rice, which generates only one-third or less the income of shrimp for Vietnamese."
In 2003, the U.S. imposed dumping duties on Vietnamese catfish. The shrimp trade petition constitutes a far greater threat to Vietnam's economy; shrimp exports are worth approximately $500 million compared to the $10 million value of catfish exports, and the shrimp industry employs more than eight times as many workers as the approximately 400.000 people working in the catfish industry."
According to Andrew Wells-Dang, regional representative of the Fund for Reconciliation and Development, the so-called "non-market" economy provisions of the US dumping laws resulted in Vietnam and China receiving different treatment than the other four countries in the shrimp case. "This treatment is evidence of the contradictions in U.S. trade policy. The United States and Vietnam have signed a bilateral trade agreement designed to encourage Vietnamese private sector development and exports, and yet the US duty determinations ignore real Vietnamese market conditions, resorting to numbers based on shrimp production in some unrelated 'surrogate' country."
"ActionAid calls on the United States government to ensure a fair investigation of Vietnam's shrimp industry," concluded Dr. Khadka. "Based on our first hand observations, we are confident that, if a fair investigation is conducted, no dumping duties will be placed on Vietnam's shrimp exports."
ActionAid International is an international non-governmental organization working in 35 countries in the World. It started working in Vietnam in 1989 in the field of hunger eradication and poverty reduction. ActionAid International Vietnam contact: Dr Ramesh Khadka, firstname.lastname@example.org.
The Fund for Reconciliation and Development is an independent American non-profit organization that has worked for normal economic, diplomatic and cultural relations between the US and Indochina since 1985. The Fund for Reconciliation and Development contact: Andrew Wells-Dang, email@example.com.