October 12, 2021

Vietnam to reduce tariffs on US frozen pork

Vietnam plans to lower tariffs on US frozen pork, corn and wheat, a further sign of easing trade tensions with its biggest export market.

The cuts, which will be announced this quarter, are intended to increase imports from the United States and narrow its trade deficit with Vietnam, said Nguyen Do Anh Tuan, a spokesman for Vietnam's agriculture ministry, during an interview on October 4.

The planned cuts will see tariffs lowered to 10% from 15% for frozen pork, 2% from 5% on corn and eliminated for wheat from the current 3%, Tuan said.

The move to boost purchases of US agricultural goods is the latest effort to improve relations as Washington and Hanoi seek closer economic and geopolitical ties to balance China's increasing clout in the region.

US Vice President Kamala Harris urged Vietnam to reduce agricultural tariffs during her visit in August, where she also encouraged upgrading their relationship to a strategic partnership.

"Both sides have demonstrated a mutual understanding of each other to avoid conflict," said Le Dang Doanh, a Hanoi-based economist and former government adviser. "Both are trying to compromise."

Pork accounts for more than 70% of Vietnam's total meat consumption. While the country has one of the biggest hog herds in Southeast Asia, demand for imported pork has risen over the past two years as its pig farms were ravaged by African swine fever (ASF).

Vietnam temporarily cut its US frozen pork import tariffs to 10% last year, resulting in US exports to the country doubling in the second half of 2020 from the first half, according to a May letter to US Trade Representative Katherine Tai and signed by 72 members of the US Congress.

- Bloomberg