According to the Vietnam Cashew Association (Vinacas), the cashew industry is facing dual challenges both in terms of export and import. With export activities, the gloomy trading market from 2022 until now has not shown any signs of improvement. Specifically, during the outbreak of the COVID-19 pandemic, consumers worked from home and had a need to use health-promoting foods. Cashew nuts have the advantage that the nut contains many essential nutrients for the body, has a long shelf life, and can be stored for use gradually. Therefore, consumption has not decreased, but has increased in some places. However, after the period of implementing the distance because of COVID-19, high inflation and the effects of the Russia-Ukraine conflict forced people of all countries to tighten their spending and reduce non-essential items such as: cashew. Meanwhile, the amount of cashew kernels and deep-processed cashew kernels are still in large inventory in other countries due to storage for backup. On the other hand, the price of a series of nuts dropped deeply, which affected the consumption of cashew nuts. Therefore, along with the decrease in consumption, the price of cashew kernels has also decreased deeply for a long time so far. Standing Vice Chairman of Vinacas Bach Khanh Nhut said that from February 2023, cashew export volume has increased but not really exciting. Especially, the price is still at a low level, which does not correspond to the high price of imported raw cashew, leading to most processing enterprises having to reduce their capacity. Many businesses had to suspend operations because they could not balance the selling price of cashew kernels with the buying price of raw cashews, but also because the bank interest rates were too high; Other costs such as labor, fuel, packaging, transportation ... also increased, making the business more and more at a loss. Meanwhile, the EU and US markets are increasingly tightening the issue of food safety and hygiene; China strictly regulates and strictly enforces regulations on importing agricultural and food products across the border. Commercial disputes quite a lot; in which, most of it is in the stage of importing raw cashew nuts in terms of quality, price, and delivery time because more than 70% of raw cashew nuts of Vietnam's cashew industry are imported. These disputes greatly affect the performance of cashew kernel export contracts. According to the Standing Vice Chairman of Vinacas, another problem that is pressing and worrying for cashew businesses is that Vietnam is allowing the import of cashew kernels without applying measures to protect the domestic cashew processing industry. . Only in the first 2 months of 2023, the amount of cashew kernels imported into Vietnam has reached 10,158 tons, equivalent to nearly 44,000 tons of raw cashew nuts. In 2022, according to data from the General Department of Customs, there were 78,583 tons of cashew kernels imported into Vietnam, equivalent to nearly 350,000 tons of raw cashew nuts, larger than the total output of raw cashews produced by Vietnam in a year. “The massive import of cashew kernels will greatly affect the existence and development of the cashew processing and export industry in Vietnam both in raw cashew production and in kernel processing. Although for many years Vietnam has been leading the global cashew supply chain and value chain, that position of Vietnam is being shaken, threatened and will certainly happen if we do not change and prevent it. Stop this trend right now", emphasized Vinacas Standing Vice Chairman . , creating products with high added value, while African countries and Cambodia mainly supply raw materials to Vietnam. However, recently, the cashew growing countries in Africa and Cambodia are promoting the strategy of developing the cashew processing industry, gradually reducing the export of raw cashew. Mr. Michael Waring, First Vice Chairman of the International Dry Nut Council (INC) cum Standing Committee of the Executive Board of the Global Cashew Council (GCC) shared that the cashew production - processing - export chain is trending. tends to move to countries with abundant raw materials such as Africa for many reasons. These countries, after many years of exporting raw cashew nuts, have gradually gained access to technology and machinery and actively called for foreign investment in cashew processing thanks to the advantage of local raw materials and cheap labor costs. Moreover, in terms of geographical location, direct exports from Africa to large cashew consumption markets such as Europe and the US are closer than from Vietnam. The governments of many African countries offer preferential and supportive policies to attract investment in cashew processing plants. At the same time, for export raw cashew, they strictly regulate and monitor the minimum export price; high export tax. But with export kernels, they are tax free. Meanwhile, both raw and kernel cashews when imported into Vietnam for processing and export are exempted from tax by Vietnam. According to Vietnamese cashew businesses, inadequacies in the import tax policy of Vietnam's cashew kernels are creating trade inequality between domestic and foreign processing enterprises; creating conditions for cashew kernels from Africa to be imported into Vietnam. This does not bring any benefits to the country, and at the same time poses a great risk to the existence and development of the whole cashew industry in Vietnam. Some large enterprises, mainly FDI enterprises, are acting as focal points for importing cashew kernels, only performing a few final stages, even packing them in new packaging, so they do not create added value. Besides, imported kernels are mostly of low quality; When exported in the name of processing from Vietnam, it will reduce the overall quality of Vietnam's cashew industry, gradually losing the prestige and market share of Vietnamese cashew kernels in the international market. If not prevented early, it will lead to the loss of a National Brand that has been built for many years. A representative of the Vietnam Cashew Association said that if the above business method is allowed to develop, Vietnam's large processing enterprises will also switch to this method in order to survive. Since then, production has to be narrowed down in the direction of focusing on the last few stages, eliminating the cost of most of the invested modern lines, while each modern factory usually has to invest from 100 to 500 billion VND. Many workers and workers will lose their jobs. At the same time, African companies that sell goods through Vietnam with high profits will continue to invest in cashew processing plants, and the processing industries of these countries will thrive from the "easiness" itself. of the Vietnamese market and the unfairness of competition between processing enterprises in Africa and Vietnam. From there, these factories will gradually block the source of raw cashew nuts from Vietnamese factories to meet the needs of local processing, causing small and medium-sized factories in Vietnam to go bankrupt. Next, rise to master technology and equipment, improve quality and gradually occupy the world cashew kernel market, "squeezing" Vietnam's cashew processing industry in the not too distant future . According to Vinacas' assessment, the exemption from import tax on cashew kernels not only affects domestic cashew processing and export enterprises, but also negatively affects cashew farmers in Vietnam. Accordingly, thanks to the tax exemption, cashew kernels imported into Vietnam and then exported will compete directly on price with domestic raw cashew nuts. Processing factories are increasingly under pressure to switch to using imported cashew kernels instead of processing from raw cashew nuts, due to lower processing and management costs because they only have to do about 20% of the work compared to processing. variable from the raw thing. Time to complete products to deliver to customers faster. Less material stock, shorter so use less capital, faster turnaround. Raw cashew nuts in Vietnam will be increasingly difficult to consume. On the other hand, the fact that Vietnam's processing factories are gradually narrowing their processing activities also means that the raw material area is increasingly narrowing; the lives of hundreds of thousands of cashew farmers will face difficulties. Due to the serious nature of this problem, Vinacas has just sent a report to the Import-Export Department, urgently requesting the Ministry of Industry and Trade to take the lead, together with relevant ministries and branches to assist in finding solutions and submit it to the Government for permission to implement. to soon create fairness in the processing and trading of cashew kernels in the international market. Accordingly, Vinacas proposed to the Ministry of Industry and Trade to preside over negotiations and sign bilateral agreements with each country on import and export tax exemption for each other's goods; in which, the partner is exempt from tax with raw cashew exports to Vietnam. Thus, Vietnam will not need to change current regulations. If the countries do not agree, Vietnam should consider to apply the principle of "reciprocity" in international relations, not exempting import tax on cashew kernels imported into Vietnam; imposing a 25% export tax on cashew nuts. shelled cashew nut (Code 0801.32.00), according to the Preferential Import Tariff issued together with Decree 57/2020/ND-CP dated 10/07/2020 of the Government on amendments and supplements to a number of articles of the Government's Decree No. Decree No. 122/2016/ND-CP dated September 1, 2016 of the Government on Export Tariff, Preferential Import Tariff, List of goods and absolute tax rates, mixed tax, and foreign import tax tariff quotas and Decree No. 125/2017/ND-CP dated November 16, 2017 amending and supplementing a number of articles of Decree No. 122/2016/ND-CP. Specifically, it is necessary to impose a minimum import price for cashew kernels imported into Vietnam similar to that applied by India, the reason why countries exporting cashew kernels to Vietnam are also imposing export taxes and maximum export prices. with raw cashew nuts, making cashew kernels processed in Vietnam unfairly compete with imported cashew kernels. The Vietnam Cashew Association also proposed the Ministry of Industry and Trade and relevant ministries and branches to support research, propose and promulgate appropriate trade remedies and technical barriers to protect the legitimate interests of consumers. domestic cashew producers and processors.