Ministry warns bicycle makers

Foreign bicycle makers may try to use Viet Nam as a middle-ground to take advantage of the EU’s removal of anti-dumping duties on Vietnamese bicycles, according to the Viet Nam Competition Authority under the Ministry of Industry and Trade.

The European Commission decided to cease imposing anti-dumping tariffs on Vietnamese bicycles beginning last month, while many other countries continue to be subject to the tariffs.

The VCA said it would be problematic if Viet Nam could not find a way to control the situation.

“If the quantity of Vietnamese bicycles exported to the EU increases suddenly, it is likely that the EU will again impose an anti-dumping tariff on Vietnamese bicycles,” said Vu Ba Phu, deputy head of the authority.

Fearing negative impacts on the European bicycle industry, the European Commission decided to levy an anti-dumping duty of 15.8 to 34.5 per cent on bicycles imported from Viet Nam to the EU beginning in July 2005.

For the past five years, Vietnamese bicycle producers have faced many difficulties in keeping up with their businesses and exports due to the anti-dumping duty.

The Vietnamese bicycle industry’s output has dropped from 2 million units to just 200,000 each year. The volume of bicycles exported to the EU decreased from more than 1 million units in 2005, accounting for 11.69 per cent of the EU market share, to 21,421 units last year for 0.1 per cent of the bloc’s market share.

The anti-dumping duty also forced the industry to cut its labour force to 6,500 workers in 2009, down from 210,000 in 2005.

To strictly control exports to the EU and to prevent foreign exporters from using Viet Nam as a middle-ground to export to the EU, the VCA is now working with the Viet Nam Chamber of Commerce and Industry, the Viet Nam Bicycle Manufacturers Association and anti-trafficking agencies to closely supervise the capacity of domestic bicycle producers.

The quantity of exported bikes would not surpass the production capacity of local producers, they said.

Phu added that the provincial departments of planning and investment would only grant licences to businesses that can prove their production capability to avoid trade fraud.

Viet Nam currently has 30 bicycle production enterprises. — VNS

Tags: Vietnam Bicycle makers