Made-in-China products flocking to Vietnam
In fact, China-made products have been seen everywhere in the market for a long time, but traders say they have never seen such an impressive ‘attack’ of China-made products as nowadays.
20% and 70%
Nguyen My Anh, the owner of a stall specialising in plastic products at Binh Tay Market, related that over the last one month, she had received no less than 20 samples of plastic products offered by businessmen. “China-made products have good designs while the prices are just ½ of domestic products,” Anh said.
Though purchasing power remains low, shop owners still accept China-made products, because they have been coaxed by attractive offers. They are allowed to take goods on consignment and make deferred payments, while they still enjoy high discount rates.
The Deputy General Director of a big plastics producer in HCM City said that it is now a very difficult time for consumer plastics producers. “Our distributors in the North all have advised us not to send any more samples to them, because the northern market is now flooded with China-made products, profuse, cheap and diversified in design,” he said.
China-made construction materials have also been dominating the domestic market. Duong Duc Tri, the owner of Tri Vien private-run construction company in district 6 in HCM City, confessed that he could not understand how Chinese products could be so diversified in colour. Tri said that China-made granite products of 60x60cm now have the sales prices of VND150-250,000/sq m, while the same kind of products made domestically are selling at VND300-400,000/sq m. Tri said that a lot of Vietnamese customers still purchase China-made products because of the attractive prices, despite the warnings about the bad quality of the tiles.
According to the owner of a supermart in HCM City, the ratio of China-made footwear and apparel products sourced from China has increased from 20% to 60-70%.
Technical barrier called for
An official from the Vietnam Textile and Apparel Association (Vitas) forecasts that China-made products will flock into Vietnam on a big scale when Vietnam’s import tax is reduced from 50% to 20% under its WTO commitments.
The official said that the domestic market will see not only low-cost products flocking in, but high-quality products as well. China-made products, which can meet the standards for export to the US, EU, will also land in Vietnam via big trade companies.
Businesses have called on the Ministry of Finance to install tax barriers to limit imports through the official channel. Pham Chi Cuong, Chairman of the Vietnam Steel Association (VSA), said that to prevent China-made rolled steel from flocking into Vietnam, the ministry should raise the import tax on finished steel from 8% to 20%, and the import tax on ingot steel from 2% to 5%.
VSA, while admitting that the taxation could only help stop imports for a certain period, thinks that only high taxes could help at this moment.
Pham Do Chi, Deputy Managing Director of VinaCapital, said that he has announced the news about the landing of China-made products in Vietnam. He said that if exporters cannot sell their products to loyal markets due to the economic recession in the countries, they will try to sell products to other markets, including Vietnam.
Chi said that he read an advertisement which said a Samsung TV set is selling at VND5.3mil only, while the same product was sold at VND16mil last year. He said that it is necessary to install a technical barrier to help protect local production.
