Vietnam: US-bound Garment Exports Subject to 0.01% Levy

All US-bound garment exports will be subject to a fee from January 1 to cover costs of a consultant hired by the Viet Nam Textile and Apparel Association (Vitas) to help its members avoid trade barriers.

Exporters to the US market to voluntarily participate in a scheme under which a levy of 0.01 per cent would be made on all US-bound garment exports.

Since January of 2007, the US Department of Commerce (DOC) has conducted a programme of monitoring garment imports from Viet Nam.

Vitas has retained an American law firm, Sidley Austin LLP, not only to help Vitas members self-monitor exports to the US but also to lobby with US officials and trading partners and the WTO to overturn the DOC monitoring system, calling it an unfair trade barrier contrary to WTO rules.

Deputy Minister of Industry and Trade Bui Xuan Khu noted that US laws were complex and American garment makers were attempting to protect the domestic market by lobbying the US Congress and the DOC to take measures to hinder Vietnamese garment imports. The DOC monitoring programme was a representative example.

The US is Viet Nam’s biggest apparel export market, buying about 56 per cent of all garments exported. The US market is expected to be worth of $5.3 billion of the total of $9.5 billion worth of garments next year.

Based on these figures, total fees collected through the Vitas levy would amount to about $530,000 in 2008.

Vitas will ask customs offices to collect the fees on each lot of garments exported to the US and transfer the funds to an account that would be supervised by the Ministry of Finance and garment industry representatives.

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