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Stricter control over temporary imports for re-export worries businesses   2012-04-12 - Phap Luat

State management agencies are considering ending the activities of importing goods temporarily for re-export later. The information has made businesses worried stiff.

 

Trinh Van Minh, a businessman, said that he has invested multi-billion dong to build a storage-yard to keep the temporary imports for re-export. However, if the above said plan by the state management agencies is implemented, his business strategy would fail completely.



Minh is not alone. Many other companies in Mong Cai City, which have invested tens or hundreds of billions of dong to develop storage-yards. “If we are not allowed to do this kind of business any more, we will suffer heavily,” a businessman said, adding that other investors, who are building cold storehouses, have stopped the construction to listen for the news.



Especially, many of the businesses build storehouse-yards with the borrowed money. If they cannot implement their business plans, they would not be able to pay bank debts.



The failure of the plans of enterprises would certainly make thousands of workers become unemployed. It is estimated that 20-30,000 laborers are working in the field for the enterprises in the economic zone in the Mong Cai border gate area.



According to a high ranking official of the Mong Cai City authorities, there are hundreds of enterprises in the city have the activities of importing goods temporarily for re-export.



Therefore, state management agencies have warned that once the decision is made, it would have very big impacts, not only on local businesses, but on the community’s life as well.



The idea of stopping the activities of importing goods temporarily for re-export lager was raised at a conference discussing the measures to fight against smuggling, counterfeiting and trade frauds held in Hanoi.



At the conference, officials from relevant ministries said that the activities have been exploited by foreigners and Vietnamese to bring banned imports to the domestic market.



The officials said that it is really very difficult to fight against the activities, because the violators would cite the articles in the Maritime and Commercial Laws to refuse to receive the goods, when their illegal activities are discovered.



It happens that goods are carried to Vietnam before they are shipped to China across the border gates. However, as the Chinese government tightens the imports, the goods cannot penetrate the Chinese market and they are kept for a long time in Vietnam, thus causing negative environmental and economic impacts.



The Ministry of Public Security believes that Vietnam should not allow the economic model of temporarily importing goods for re-export to exist, saying that there are too many existing problems, while the profits are not high. At present, only some private enterprises still operate in the field, while there are too many risks Vietnam has to face.



In many cases, goods were imported to Vietnam, but they were not re-exported as promised. Tobacco and wine products, for example, would appear on the domestic market just several hours after the importers fulfilled the procedures to get customs clearance. It is obvious that the importers intended to import the goods for domestic consumption instead of re-exporting to third countries.



Besides, the representative of the ministry has also pointed out that while the profits are modest, the goods, mainly carried on container vehicles, thus causing damages to the roads, bridges and hindering the traffic.



However, the proposal on ending the activities has raised debate. An economist has warned that this would lead to a big loss of revenue.



According to the Mong Cai City’s authorities, the activities bring a revenue of 200-300 billion dong to the local budget, which is a big financial resource for the locality.



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