Steelmakers protest proposed tariff adjustments
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The Vietnam Steel Association (VSA) has protested the latest proposed adjustments to tariff rates on steel products saying they will hurt domestic manufacturers.
Under the proposal made by the Ministry of Finance, export tariff for billets would rise from zero percent to 5 percent, while the most favored nation (MFN) import rates for certain steel products would be reduced to 10 percent from 15 percent.
The proposal is aimed at cutting the prices of construction steel, which have shot up 40 to 50 percent compared to early 2020.
VSA has protested the proposal, arguing that the prices were impacted by the global raw materials market rather than the current tariff policies, or any trade remedies applied to steel products.
VSA chairman Nghiem Xuan Da noted that most of the input materials for steel production are imported. A price hike in these materials will immediately affect domestic manufacturers, causing output prices to skyrocket.
However, global steel prices have declined since late May.
Vietnam reaped steel export earnings of $4.9 billion in the first half of this year. Meanwhile, it produced 16 million tons of steel, up 37 percent over the same period last year.
Questions & Answers
Q.What specific tariff changes have been proposed by the Ministry of Finance?
What specific tariff changes have been proposed by the Ministry of Finance?
The proposal includes raising the export tariff for billets from zero to five percent. Also, MFN import rates for certain steel products would be reduced from 15 percent to 10 percent.
Q.What is the Ministry of Finance's stated reason for proposing these tariff adjustments?
What is the Ministry of Finance's stated reason for proposing these tariff adjustments?
The Ministry of Finance aims to cut the prices of construction steel. These prices have significantly increased, rising by 40 to 50 percent compared to early 2020.
Q.What argument does the VSA use to protest the proposed tariff adjustments?
What argument does the VSA use to protest the proposed tariff adjustments?
The VSA argues that global raw material prices, not current tariff policies or trade remedies, caused the steel price increases. They note that imported input materials significantly affect domestic manufacturers.
Q.How has the steel industry in Vietnam performed recently regarding exports and production?
How has the steel industry in Vietnam performed recently regarding exports and production?
Vietnam earned $4.9 billion from steel exports in the first half of this year. Production reached 16 million tons, representing a 37 percent increase over the same period last year.
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