France is a large cashew nut import market in the EU. However, Vietnamese enterprises want to receive further support to effectively exploit the EVFTA Agreement.
France is one of the major cashew nut import markets in the EU. However, in order for Vietnamese cashew nuts to "stabilize" in this market, businesses want to receive more support from the authorities to effectively exploit the Vietnam - EU Free Trade Agreement. (EVFTA).
More competitors
Mr. Vu Anh Son - Vietnam Trade Counselor in France - said that from 2016 to 2020, the consumption and import of cashew nuts from France was stable, increasing by 8% in value and 10% in volume. A large amount of cashews imported into France is from Vietnam. The amount of cashew nuts imported from Vietnam into France through a third country like the Netherlands is not small. However, in the two years of 2019-2020, Vietnam's cashew nut market share in France has decreased from 61% to 46%. The reason explained by Mr. Vu Anh Son is that the competitiveness of Vietnamese cashew nuts is not strong. In French supermarkets and hypermarkets, there are no Vietnamese-branded cashew products. Most businesses only focus on wholesale but have not paid attention to brand development and increase product value.
The appearance of Cambodian cashew nuts in France for the first time in 2020 with a very small turnover, only a few tens of thousands of dollars, is a warning bell for Vietnamese cashew exporters. "Cambodia becoming the second largest rice exporter to France after only 5-7 years from almost no market share is a new story, most likely to happen with cashew nuts" - representative of the Vietnam Trade Office in France commented. “Campuchia trở thành nhà xuất khẩu gạo lớn thứ 2 vào Pháp chỉ sau 5-7 năm từ chỗ gần như không có thị phần là câu chuyện còn mới, rất có thể xảy ra với hạt điều” – đại diện Thương vụ Việt Nam tại Pháp nhận định.
Moreover, it is not excluded that in the future EU importers including France will diversify their supply to avoid dependence and Africa is a destination. This may also be a new market, competing with Vietnam's cashew nuts.
Effective exploitation of EVFTA
Experts say that the weakness of Vietnam's cashew nuts in France in particular and the EU in general can be removed by well exploiting the existing advantages, especially with the EVFTA. Accordingly, the tax rate for processed cashew nut products imported from Vietnam into the EU will be reduced to 0% immediately after the EVFTA comes into effect. This reduction is very important, because before the agreement came into effect, Vietnamese cashews exported to the EU were subject to a tax rate of 7-12%, creating a significant competitive advantage.
However, Mr. Vu Anh Son also said that the EVFTA is a good tool, but in addition to the rules of origin to enjoy tariff preferences, meeting EU and French regulations is paramount. The food-related legal system of this regional market is quite complex and has its own regulations on mycotoxins, pesticide residues, heavy metal content, and microbiological pollutants. Before putting goods on the market, the best way for businesses is to find a lawyer's office to support them, they can update the latest information, assist in building contracts and assist in the transaction process to avoid risk.
Before the recommendation of the Vietnam Trade Office in France, representing businesses in the cashew industry, Mr. Dang Hoang Giang - General Secretary of the Vietnam Cashew Association - suggested that the Ministry of Industry and Trade strengthen the implementation of solutions to specific to streamline cooperation agreements through free trade agreements, especially EVFTA, to maximize trade facilitation for businesses.
Source: Viet Nga (Vinacas)/Industry and Trade Newspaper
