Vietnam Lowers Dairy Tariffs, Benefitting U.S. Exports
Luke Waring, USDEC
ARLINGTON, VA. - Vietnam has signed a decree unilaterally lowering tariffs on key dairy products and ingredients, including skim milk powder, whole milk powder, cheese, milk albumin and protein isolate. The decree goes into effect on July 10.
Most tariffs on dairy products and ingredients will decrease by 50% or more. The U.S. Dairy Export Council (USDEC) received confirmation today (May 28) that the decree has officially been announced by Vietnam Prime Minister Nguyen Xuan Phuc.
USDEC worked for more than a year to secure the measure. It reduces a competitive disadvantage created when the Trans-Pacific Partnership went into effect without U.S. participation, along with other free-trade agreements, including one with the European Union.
Since 2017, U.S. dairy exports to Vietnam have grown by more than 50%, to $170.5 million (86,230 metric tons) last year, making it the U.S. dairy industry's eighth-largest export market.
"Vietnam's decision to unilaterally lower tariffs will better position the U.S. dairy industry to provide a consistent supply of high-quality and competitively priced dairy products to the mutual benefit of both nations," said USDEC President and CEO Tom Vilsack. "The effort illustrates how the U.S. Dairy Export Council delivers value to its member companies and dairy farmers."
With Australia/New Zealand and the European Union all gaining preferred access to Vietnam through the Comprehensive Agreement for Trans-Pacific Partnership and the EU-Vietnam Trade Agreement, USDEC saw that U.S. suppliers would soon be facing a significant competitive disadvantage. The Trade Policy team, working with the Market Access and Strategy and Insights teams, as well as USDEC's office in Vietnam, began a campaign to reduce that competitive disadvantage.
USDEC submitted a petition to reduce tariffs to the Vietnamese government in April 2019, traveled to Vietnam to meet with government officials and utilized a focused local team to conduct follow-up contact in-market with Vietnam.
"While this is certainly a development to celebrate," Vilsack said, "USDEC will continue working toward a free-trade agreement with Vietnam that expands U.S. market share by removing all dairy tariffs and ensuring that the access afforded to U.S. suppliers is second to none."
The U.S. Dairy Export Council is a non-profit, independent membership organization that represents the global trade interests of U.S. dairy producers, proprietary processors and cooperatives, ingredient suppliers and export traders. Its mission is to enhance U.S. global competitiveness and assist the U.S. industry to increase its global dairy ingredient sales and exports of U.S. dairy products. USDEC accomplishes this through programs in market development that build global demand for U.S. dairy products, resolve market access barriers and advance industry trade policy goals. USDEC is supported by staff across the United States and overseas in Mexico, South America, Asia, Middle East and Europe. The U.S. Dairy Export Council prohibits discrimination on the basis of age, disability, national origin, race, color, religion, creed, gender, sexual orientation, political beliefs, marital status, military status, and arrest or conviction record. www.usdec.org.