Vietnamese shoe makers should not compete with low prices: MOIT

Vu Ba Phu, Deputy Director of the Competition Administration Department (CAD) under the Ministry of Industry and Trade think that Vietnamese shoe makers should not try to compete with rivals with low prices. They should control the exports increases, or their products will bear tax re-imposition.

The European Union (EU) has officially announced the removal of the anti-dumping duties on leather capped shoes sourced from Vietnam, starting from April 1, 2011. This is really good news for Vietnamese shoe makers, who have been suffering from the high duties. However, in a talk with local press agencies, Vu Ba Phu, Deputy Director of CAD, said that Vietnamese should be cautious with their exports in the time to come, and that there is still the possibility of the EU re-imposing taxes on Vietnamese products.

How will Vietnamese shoe makers take full advantage of the EU’s decision on removing the anti-dumping duties on leather capped shoes?

The EU is now the main export market for Vietnamese footwear products which consumes over 50 percent of total exports. In 2010, Vietnam’s footwear export growth rate was lower than expected, with the export turnover reaching 5.09 billion dollars. However, in 2011, as the anti-dumping duties have been removed, it is expected that the footwear export turnover this year will reach 5.5-5.6 billion dollars.

Some experts have warned that though the EU has removed the anti-dumping duties, Vietnamese products will still find it hard to compete in the EU market, because Chinese products are very cheap?

Enterprises can compete through many ways, including the high quality and the right choice of the targeted markets. If enterprises make popular products, they need to keep the production costs at the lowest possible levels. Meanwhile, if they make high grade products, they need to compete with high quality, deep understanding of customers, or with media campaigns. I think that Vietnamese enterprises shoudn’t necessarily compete with low prices, but they should target higher market segments, including medium and high grade market segments. I believe that we have advantages in making products to serve different market segments. Not only in the EU, but in the US market as well, Vietnamese footwear products have been highly appreciated for high quality.

Can you see any possibility of the EU to re-impose anti-dumping duties on Vietnamese shoes?

Though the anti-dumping duties have been removed, but it is very likely that Vietnamese leather capped shoes exports will still be put under a monitoring mechanism like the monitoring mechanism once applied by the US on Vietnam’s garment exports. The European Commission (EC) will strictly supervise the import volume from Vietnam for one year. If the import volume increases sharply during that time, they may immediately re-impose the anti-dumping duties on Vietnamese products.

Do you have any advices to shoe makers in particular and Vietnamese exporters in general?

We have learned many lessons about exporting to the EU market. When import countries tend to increase the use of the tools to protect their local production, enterprises should attach much importance to making medium and high class products, fulfilling the contracts with high values, rather than trying to make popular products with low production costs.

On March 16, the official gazette of the EU published the announcement about the removal of the anti-dumping duties on Vietnam and China-made leather capped shoes, starting from April 1.

In October 2006, the EC released the decision on imposing the anti-dumping duty of 10 percent on Vietnamese leather capped shoes exported to the EU for two years. In December 2009, the EC decided to extend the duties for 15 months more.

The anti-dumping duties made Vietnamese shoe makers suffer heavily – Vietnamnet

Tags: Vietnamese shoe makers