France is the largest import market for cashew nuts in the EU bloc. However, Vietnamese enterprises want to receive more support to effectively exploit the EVFTA Agreement.
France is one of the major import markets for cashew nuts in the EU bloc. However, for the Vietnamese cashew nut to “remain its foothold” in this market, enterprises hope to receive more support from authorities to effectively exploit the Vietnam-EU Free Trade Agreement (EVFTA).
Mr. Vu Anh Son – Vietnam Trade Counselor in France, said that between 2016 and 2020, French consumption and imports of cashew nuts were stable, up 8% in value and 10% in quantity. The large amount of cashew nuts imported into France is from Vietnam. France’s import of cashew nuts from Vietnam through third countries like the Netherlands is also not small. However, in 2019-2020, Vietnam’s cashew nut market share in France fell from 61% to 46%. The reason explained by Mr. Vu Anh Son is that the competitiveness of the Vietnamese cashew nut has not been strong. At French supermarkets, and hypermarkets, there is no Vietnamese brand of cashew nut products. Most enterprises have only focused on wholesale but brand development, and product value increase.
The arrival of Cambodian cashew nuts in France for the first time in 2020 with a small turnover, only tens of thousands of USD, however, is a warning to Vietnamese cashew nut exporters. “Cambodia becoming the second-largest rice exporter to France after only 5-7 years from almost no market share is a new story, that most likely happen with cashew nuts” – Vietnam Trade Office Representative in France said.
Moreover, it is not excluded that in the future, EU importers including France will diversify their supply to avoid dependence and Africa is a destination. This may also be a new market, competing with Vietnam’s cashew nuts.
Cashew nut exports to France: Taking advantage of favorable conditions. (Photo: Internet)
EFFECTIVE EXPLOITATION EVFTA
Experts said that the weakness of Vietnamese cashew nuts in France in particular and the EU, in general, can be overcome by the effective exploitation of available advantages, especially EVFTA. Accordingly, the tax rate on products processed from Vietnamese cashew nuts imported into the EU decreased to 0% as soon as EVFTA became valid. This reduction is very important because, before the agreement, Vietnamese cashew nuts exported to the EU were subject to a tax rate of 7-12%, which created a significant competitive advantage.
However, Mr. Vu Anh Son also said that EVFTA is a good tool but in addition to the rules of origin to enjoy tariff preferences, meeting the regulations of the EU and France is more important. The legal system related to food in this market is quite complicated and has specific regulations on mold toxins, pesticide residues, heavy metal content, and microbiological pollutants. Before bringing the goods into the market, the best way for enterprises is to find a lawyer’s office for support. They can update the latest information, and assist in the contract building and the trading process to avoid risks.
Following the recommendation of the Vietnam Trade Office in France, Mr. Dang Hoang Giang – General Secretary of the Vietnam Cashew Association proposed: The Ministry of Industry and Trade needs to take measures to specify the cooperation through FTAs, especially EVFTA, to maximize trade facilitation for enterprises.
The Trade Promotion Agency provides more information, forecasting the consumption trends of the EU market including France; supports the association to strengthen trade promotion activities with EU importers.
“We are developing a trade promotion project, organizing an international cashew sector conference in Vietnam in 2023, and a trade promotion delegation to other markets. We hope to receive the support of the Ministry of Industry, Trade and Vietnam Trade Office in these markets,” Mr. Dang Hoang Giang said.