Vietnam’s exports of a number of textiles and garments that are entitled to preferential tariffs in the Eurasian Economic Union (EAEU) have exceeded their quotas.
The Eurasian Economic Commission (EEC) on September 28 sent a document to the Vietnamese Ministry of Industry and Trade saying that Vietnam’s exports of some textiles and garments from January to July 2021 exceeded the quotas for preferential tariffs.
Exports of underwear (Harmonised System (HS) codes 6107, 6108, 6207, 6208 and 6112) amounted to 175 percent of the quotas. Besides, the exports of dresses and women’s clothing (HS codes 6104.41 6204.49) and exports of suits, jackets, sport coats and trousers (HS codes 6103 41 6204 69) reached 105 percent and 100 percent of the quotas, respectively.
According to Clause 2.10 of the VN-EAEU free trade agreement, these items may not be entitled to the preferential tariff of 0 percent for a period of six to nine months and instead will have to pay the Most Favoured Nation import duties of 12%.
The Eurasian Economic Union, whose members comprise Russia, Belarus, Kazakhstan, Armenia and Kyrgysstan, has an integrated single market of 180 million people.
The free trade agreement between Vietnam and the EAEU came into effect in 2016. Two-way trade between Vietnam and the EAEU rose 6.5 percent year-on-year to $5.2 billion in 2020, of which Vietnam’s exports to the EAEU reached $3.1 billion, while imports amounted to $2.1 billion, up 7.2 percent and 5.5 percent from the previous year, respectively.
Russia accounted for 94 percent of Vietnam’s exports to the EAEU last year.
Notes from PPI Sourcing (Prosperous Partnership International Company Limited)
We @ PPI Sourcing advice our clients and local partners to take into account potential change in EAEU import duties of made-in-Vietnam clothings, such as underwear, dresses, suits, jackets, sport coats, trousers…for the next 6-9 months when conducting businesses and negotiating deals.
Source: Saigon Times