WASHINGTON, DC – The U.S. Congress passed legislation today granting Vietnam Permanent Normal Trade Relations (PNTR) status, a necessary step to ensure that U.S. companies will benefit immediately from Vietnam’s accession to the World Trade Organization in early January 2007. Vietnam’s WTO membership will pave the way for increased U.S. distilled spirits exports to Vietnam through steep tariff reductions and significant excise tax reform, according to the Distilled Spirits Council of the United States.
“Under WTO rules, the U.S. could not benefit fully from the substantive and commercially significant steps Vietnam has agreed to take to open its market to imported products — including distilled spirits — until Congress passed PNTR,” said Deborah Lamb, the Council’s senior vice president for international trade, noting that Vietnam has made significant commitments to liberalize its market in its bid to join the World Trade Organization. “Now that Vietnam has PNTR status, U.S. spirits exporters will be able to enjoy the full benefits of Vietnam’s WTO accession package.”
Lamb said that Vietnam’s WTO accession will benefit the distilled spirits industry in several important ways:
• Vietnam will lower its tariffs on imported spirits from 65% to 45%;
• Within three years of accession, Vietnam will reform its discriminatory excise tax regime for spirits, which is currently structured to assess significantly higher taxes on imported spirits than on domestically-produced spirits;
• Import trading rights for distilled spirits will be granted as of January 1, 2007;
• Spirits companies will be able to engage in wholesale and retail businesses three years after Vietnam joins the WTO.