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FULBRIGHT ECONOMICS TEACHING PROGRAMCE03-52-8.0_.Feb 27, 2003NGUY EN XUA N THANHCATFISH FIGHT:.VIETNAM’S TRA AND BASA FISH EXPORTS TO THE US.On August 8th, 2002 a meeting of the US International Trade Commission (ITC) concluded with the.following statement: "Based on the preliminary findings, we determine that there is a reasonable.indication that the domestic industry producing frozen catfish fillets, whether or not breaded or.marinated, is threatened with material injury by reason of subject imports from Vietnam that are.allegedly sold in the United States at less than fair value.” This decision came forty days after the.Catfish Farmers of America (CFA), a trade association of US catfish farmers, accused 53 Vietnamese.fishery exporters and processors of dumping frozen tra and basa fillets on the US market, causing.major damage to local catfish producersThus, the initial round of the first dumping case between the US and Vietnam ended. The case was then.passed to the US Department of Commerce for a dumping investigation. The verdict is expected in July.2003 if the case continues till its last stage. If the verdict is in favor of the CFA, i.e. the petitioner, then.imports of frozen tra and basa fillets from Vietnam will be subject to antidumping duties as high as 191.percent. This is in contrast to the current rate of zero percentSince the dumping charge was initiated shortly after the US-VN BTA became effective, it drew.enormous attention from the government and the business community in Vietnam. There is particular.concern for the impact this case would have on the livelihood of almost 200,000 farmers in the Mekong.Delta. The CFA has argued that they are just simply trying to maintain a level playing field in trade In.contrast, the Vietnamese have cited protectionism as the main reason behind the CFA’s claim which.started with the catfish-labeling dispute several months before the dumping charge was madeThe purpose of this case study is to describe the trade dispute settlement mechanism in the US and.address the issue of fair trade. It also analyzes the various arguments put forward by the Vietnamese.side and the likely impact that an antidumping duty would have on the Vietnam’s frozen fish.processing industry and fish farmersOther issues raised by this case are to what extent are the regulations on labeling, dumping, subsidy,.environment, and labor reasonable tools in ensuring fair trade or to what extent are they just implicit.trade barriers? How strong is protectionism in rich countries and how does it affect Vietnam’s.integration and outward-looking strategy? Should Vietnam be treated as a non-market economy or a.market economy in this trade dispute? What advantages would Vietnam have in defending the case if it.were a member of the WTO?This case study was prepared by Nguyen Xuan Thanh, lecturer at Fulbright Economics Teaching Program. Fulbright Economics.Teaching Program’s cases are intended to serve as the basis for class discussion, and not to make policy recommendationsCopyright © 2003 Fulbright Economics Teaching Program.Catfish Fight: Vietnam’s tra and basa fish exports to the USCE03-52-8.0Tra and Basa Culture in the Mekong Delta.Fresh scaleless fish in Southeast Asia belong to the Pangasius family and are raised mainly in river.cages or ponds by small-scale farmers. In Vietnam, basa and tra (also called hypobasa) are the two most.popular scaleless fish in the Mekong Delta. Before 1995, brood stocks were fingerlings (small fish).caught in nature. After each mating season, fingerlings swam along the Mekong River from Laos and.Cambodia to the Mekong Delta. They were caught and sold to fish farmers. As a result, farmers.suffered the problems of high-cost brood stocks due to limited supply, unsecured supply, and a high.death rate of fish due to changes in the living environment. Breeding technology was introduced in.199
