HCMC – The Vietnam Chamber of Commerce and Industry (VCCI) has put forward a proposal to the Government to revise regulations on rice exports, aiming to facilitate the operations of small-sized exporting enterprises.
VCCI expressed this opinion while providing feedback on the draft revised Decree 107 on rice exports. According to the draft, rice exporting businesses are required to maintain a minimum circulation reserve regularly and possess warehouses and rice mills that meet national technical standards.
However, VCCI suggested that the minimum circulation reserve should be managed through market-driven orders from the Government to businesses, rather than using bureaucratic measures. In practice, some businesses face challenges in meeting the requirements for qualified warehouses and rice mills, which can result in significant expenses when building or leasing facilities.
The current regulations on rice exports seem more suitable for large businesses rather than small-sized enterprises, particularly as small companies are endeavoring to penetrate new markets. Many Vietnamese businesses are now targeting new markets like the European Union, Canada, and the Middle East, which demand high-quality rice with proper packaging and preservation at reasonable prices.
Due to their inability to meet the export conditions, some businesses need to outsource other units to export rice for them, incurring additional costs ranging from US$1 to US$5 per ton. This situation makes Vietnamese rice less competitive in the international market, according to VCCI.
VCCI also recommended that the Ministry of Industry and Trade authorize provincial People’s Committees or the Department of Industry and Trade to issue certificates of eligibility for rice exports. Additionally, VCCI proposed the removal of the requirement for re-issuing certificates every five years, aiming to reduce costs and time for rice exporting businesses.
During the past two weeks, Vietnam’s rice export prices have surged, possibly exceeding US$600 per ton, following bans imposed by India, the UAE, and Russia on rice exports.
Vietnam’s rice export is projected to reach 7.5 million tons in 2023, a 6% increase compared to the previous year.