Vietnam dumps bike parts quota
HANOI - Vietnam has scrapped a quota for imported motorbike parts
that forced two major Japanese manufacturers to temporarily halt production
at their Vietnamese plants last year, an official said Monday.
The ruling, which took effect Jan. 1, allows the country's seven foreign
motorbike manufacturers to import as many motorbike kits as allowed in their
business licenses, the Industry Ministry official said on condition of anonymity.
In September, Hanoi abruptly imposed a quota for imported motorbike parts,
effectively forcing Japanese manufacturing giants Honda and Yamaha to
suspend production before the restrictions were eased two months later.
At the time, the government cited an increasing number of traffic accidents,
which killed nearly 13,000 people last year, for the imposition of the quota.
But industrial insiders said the move was to force the foreign assemblers to buy
more locally made parts.
The Vietnamese government has also abolished a sliding scale of tariffs on
imported parts.
Under that system, tariffs on imported parts could be as low as 10 percent for
companies that used more than 60 percent locally made parts.
As of Jan. 1, the tax rate for imported parts ranges between 10 percent and 50
percent, depending on type, and is applied to all foreign or local bike
assemblers, according to an official of the Finance Ministry's tax department.
The seven foreign manufacturers source about 50 percent of their motorbike
parts locally.
Vietnam, with a population of 80 million, has more than 10 million motorbikes,
one of the highest ratios in the world.
The Associated Press - January 13, 2003.
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