Coffee exporters dispute fees

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VietNam News English - 34 month(s) ago 12 readings 1 duplicate news

Coffee exporters dispute fees

Many local coffee exporters have opposed the collection of coffee export fees, which come into effect as of October 1.

Farmers harvest coffee beans at Huong Hoa District, Quang Tri Province. The Viet Nam Coffee and Cocoa Association has agreed to collect export coffee fees of US$2 per tonne. — VNA/VNS Ho Cau
HA NOI —

The Viet Nam Coffee Industry Export Insurance Fund Management Council under the Viet Nam Coffee and Cocoa Association (Vicofa) has come to an agreement to collect exported coffee fees of US$2 per tonne.

Proceeds gathered will be invested back into the industry according to a proportional distribution agreement, with 50 per cent given for replanting, 30 per cent for temporary reserve interest aid, 10 per cent for quality improvement, and 10 per cent for brand and trade promotional activities.

The fund aims to stabilise and promote production and processing, improve coffee quality, restrict risks in coffee exports and support trade promotion activities and market information, the association said.

Most of the fund will be used to support the creation of coffee varieties with high yield and quality, as currently 25 per cent of Viet Nam's coffee plantation areas have not been cultivated to their potential.

Farmers and exporters would benefit from the fund, said Luong Van Tu, Vicofa chairman, adding that the fund would be re-invested into coffee plantations to create stability of the raw material for export processing over the next 5-10 years.

However, Nguyen Anh Tuan, deputy director of the Viet Nam General 1 Import Export Joint Stock Company, said the collection of the fee is for membership of the association while foreign companies that have purchased and exported 50-60 per cent of Viet Nam's coffee output would not have to pay the fee.

Tuan said it was unfair because re-investment into coffee trees with the money from the fund would bring advantages for not only the member companies of the association but also foreign companies.

Representative of the Intimex Company said foreign companies have had advantages in finance, but they were not subject to the fee as domestic companies who have had difficulties with finance must pay the fee. That situation would create more challenges to the domestic coffee exporters.

Pham Ngoc Bang, deputy general director of Dac Man Coffee Joint Stock Company, said the fee was discussed only among companies who were members of the association's executive committee, not all association members.

Regulations for managing the fund were not clear so members have many questions about how the money would be managed, Bang said. Many member companies have not supported using the fund for exporters with losses because exporters could then rely on the fund.

Le Duc Thong, head of Vicofa's supervisory department, said the details on how the fund would be used, who the payers were, and other issues still needed to be further discussed.

"Additionally, all local and foreign coffee exporters in Viet Nam must pay the fee if it is to be fair," Thong said.

The Viet Nam Coffee Corporation and Vicofa have discussed specific regulations on the fund and related issues which would be submitted to the Government in the near future. — VNS

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