US and Vietnam in catfish spat
WASHINGTON - The US on Monday said it was likely to impose prohibitive tariffs against Vietnam's
sales of catfish to the US, cutting off one of Vietnam's fastest-growing exports just one
year after the two countries concluded a free trade agreement.
In a case brought by southern catfish farmers, the US Commerce Department said
four Vietnamese companies were dumping catfish in the US at below fair prices. The
companies will have to pay duties of between 38 per cent and 62 per cent if the US
decides later this year that its own catfish farmers are being hurt by the imports.
The catfish has long been a staple of southern US cooking, and the dispute has pitted
the rising political power of the rural US south against efforts by Washington to
cultivate closer trade ties with Vietnam. The US has been eager to encourage market
reforms in Vietnam since a trade agreement in December 2001.
But Vietnam's success has aroused protectionist pressures. The country has
captured about 20 per cent of the $600m US frozen catfish market as part of a
successful export drive that has seen sales to the US double since the trade pact was
concluded. Vietnam sells more than $2bn in catfish worldwide, one of the country's
largest export items, employing between 300,000 and 400,000 people in the country's
Mekong delta.
That has led to a political backlash in Washington, which last year included
congressional legislation forbidding the Vietnamese from calling their product catfish
when they sell it in the US. Instead they must label it "basa catfish" or one of a number
of other local varieties.
Vietnam warned last week that a negative ruling could hurt trade relations between
the two countries.
The US still considers Vietnam as a "non-market economy" for the purpose of
determining whether the country is dumping its products unfairly.
By Edward Alden - The Financial Times - January 28, 2003.
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