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Warning: risks of exporting pepper to Myanmar

Saturday 19, 10 2019
According to the Ministry of Industry and Trade, the Vietnam Trade Office in Myanmar has urged caution to Vietnamese enterprises who export pepper to this market.
Warning: risks of exporting pepper to Myanmar

According to Vietnam Office Trade in Myanmar, Ngwe Galon Min Company (Ngwe Galon Min Co., Ltd; address: 446/447, Konzedan Street, Thein Gyi Zay (A) Yone, Pabedan Tsp, Yangon) has been put into the watch list by Myanmar Customs. It is said that pepper consignments imported by the above-mentioned enterprise shall not be facilitated for re-export to Vietnam as the procedures for receiving cargoes have not been implemented. Myanmar Customs will also conduct auctions and confiscation of funds (if customs clearance procedures are not carried out within 60 days of arrival).

Previously, goods of a number of Vietnamese enterprises that exported white and black pepper to Myanmar during the period from mid-2018 to early 2019 were regularly rejected by their imported Ngwe Galon Min Co., Ltd., for reasons of financial difficulties or low-quality of pepper... This company only paid the deposit (10-30% of the value of the shipment), delayed the full payment and even refused to receive the goods when the goods arrived at the port of Yangon, Myanmar.

According to the representative of Vietnam’s Ministry of Industry and Trade in Myanmar, the reason why the above Myanmar business does not receive goods is mainly due to the low price of pepper at the time of delivery compared to the initial estimate. A number of Vietnamese exporters have had to re-export to avoid damage. In accordance with Myanmar's law, if imported goods arrive at the port without clearing customs within 60 days, the shipment will be auctioned and expropriated.

The Import-Export Department - Ministry of Industry and Trade said that in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), there are nine countries including Australia and New Zealand. Zealand, Canada, Malaysia, Singapore, Brunei, Chile, Peru and Japan committing to immediately eliminate tariffs on pepper. Mexico committed to eliminate tax within 16 years for green pepper.


The increase in annual import and export turnover is a good sign for the Vietnamese economy, but it also comes with many risks for exporting enterprises when there are disputes related to import and export contracts. According to economists, in the context of deep integration, Vietnamese businesses need to understand and have in their hands the information about their partners or they will face many disadvantages.
Warning: risks of exporting pepper to Myanmar

The first thing companies need to do when doing business with foreign countries is to get partners’ information by searching on the internet, consulting lawyers or diplomatic missions of Vietnam in foreign countries. However, these solutions can hardly give a comprehensive result to help businesses assess their partners.

Therefore, it is essential that Vietnamese businesses engaging in international trade should rely on credit rating companies. Currently, there are many agencies providing this service in the world, such as S&P, Fitch, Moody’s. In addition, Vietnamese businesses can also place their faith VietnamCredit - the first credit rating company in Vietnam.

VietnamCredit can provide comprehensive company reports on domestic as well as foreign businesses. This type of report covers information about business registration, executives and shareholders, business performance, financial statements, disputes - complaints, etc. All of this information is the most updated information, which will be a useful reference for businesses before making business decisions.

Besides, when drafting a contract, businesses must pay attention to the terms of the dispute. For example, in case of a dispute, where should economic arbitration be given, under which country law should it be handled? Which agency verifies product and goods quality? Without detailing these terms, it will be difficult to resolve the complaint later.

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