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Chinese businessmen scrambling for seafood materials   2011-06-17 - VEF

While Chinese ships obstruct Vietnamese fishing at sea, Chinese businesses try to collect the seafood caught by Vietnamese fishermen.


Since seafood gets depleted and fishing has been interrupted, seafood processing companies have to compete fiercely with each other to buy seafood. Meanwhile, Chinese businessmen have triggered an unhealthy competition to scramble for seafood from Vietnamese companies.

Putting pressure both at sea and ashore

According to Nguyen Thi Thu Sac, Deputy Chair of the Vietnam Association of Seafood Exporters and Producers (VASEP), many Vietnamese fishermen, due to the Chinese recent actions at the East Sea, dare not go out to the sea. The ships, which still go fishing these days, regularly meet Chinese businessmen who try to collect seafood right at sea. Meanwhile, on land, Chinese businessmen try to scramble with Vietnamese companies for purchasing seafood.

Nguyen Diem, Director of the Da Nang-based Procimex, said that in order to compete with Chinese businessmen, domestic enterprises have to raise the prices, at which they purchase seafood from fishermen. However, the company still cannot collect enough materials.

Pham Xuan Nam from Dai Thuan Company in Khanh Hoa province, also complains that the volume of seafood Nam can collect is just enough for 30 percent of the designed processing capacity. According to Nam, the Chinese seafood collectors have “occupied the land of Vietnamese enterprises” for a long time, while Vietnamese fishermen, seafood companies and government agencies have not made any reactions, or just have made gentle reactions.

“They (Chinese businessmen) come to purchase goods, place orders and then carry goods to China as if they are Chinese territory,” Nam said.

Vietnamese businessmen incur risks

Seafood companies complain that when purchasing seafood materials from fishermen, they have to issue invoices and pay taxes. Meanwhile, Chinese businessmen, who purchase goods directly from fishermen at sea or ashore, do not have to bear any kinds of tax. Therefore, they just need to set up the purchase prices at a little higher than the prices set by domestic companies, they would be able to buy as much as possible.

Experts have pointed out that in the trade across the border (there are two ways of trade between Vietnam and China, either through the border gates, or through the official channel), the payment can be made in both--Chinese yuan or Vietnam dong; therefore, it is very difficult to reckon up the trade values exactly.

Nam from Procimex also said that the value of cross-border trade is very big, while it is not counted on into the national import-export turnover, thus raising the risk about the increase in the trade gap with China.

Sac of VASEP has pointed out that the difficulties in collecting materials, plus the increasingly high input costs have put many enterprises into big difficulties. Since the beginning of the year, 147 companies have “turned their back” to the seafood processing industry and export. This also can explain why Vietnam has lost 14 old markets, though it has found 15 new markets.

“I know many domestic processing companies have to purchase seafood at any costs to process to fulfill orders,” Sac said. “In the current conditions, when the input costs are sky high, but the export prices do not increase, Vietnamese companies are facing a lot of risks”.

“A lot of enterprises have been threatened to go bankrupted,” she stressed.

Diem has proposed government agencies to reconsider resuming the taxation on the fishermen who sell goods to foreign businessmen.

Sac said that Indonesia is now prohibiting the export of seafood materials, and she thinks Vietnam should also consider this measure.

In related news, Saigon tiep thi has reported that Chinese businessmen have also been trying to collect foodstuff in Vietnam, which has pushed the domestic foodstuff prices up.

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