  
  RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/VNM/3/Add.1 
30 October 2003 
 (03-5767) 
Working Party on the 
Accession of Viet Nam Original:   English 
 
 
 
ACCESSION OF VIET NAM 
 
Domestic Support and Export Subsidies in Agriculture  
 
Questions and Replies 
 
Addendum  
  The Government of the Socialist Republic of Vi et Nam has submitted the following replies to 
questions raised with the request that they be  circulated to members of the Working Party. 
 
 
_______________ 
 WT/ACC/SPEC/VNM/3/Add.1 
Page i 
   
TABLE OF CONTENTS 
 
Supporting Table DS:1 – Measures exempt from the reduction commitment –..............................1 
Supporting Table DS:4 – Calculation of the Total Aggregate Measurement of Support ...............6 Supporting Table DS:5 – Product-Specific Aggregate Measurements of Support:  
Market Price Support........................................................................................................... ....7 
Supporting Table DS:7 – Product-Specific Aggregate Measurements of Support:  Other 
Product-Specific Support and Total Product-Specific AMS ..............................................12 
Supporting Table DS:8 – Product-Specific Equivalent Measurements of Support.......................13 Supporting Table DS: 9 – Non product specific AMS......................................................................19 Supporting Table ES:1 - Export Subsidies:  Outlay and Quantity .................................................20 
 
     WT/ACC/SPEC/VNM/3/Add.1 
 Page 1 
 
 
  Supporting Table DS:1 – Measures exempt from the reduction commitment – "Green Box"  
Question 1 What, on average, is the size of the public stocks for food security purposes in relation to 
production and consumption? What is the buying in price of the rice in these stocks? How are 
unused quantities disposed of and what is the sales price? 
Answer: 
 
The amount of public stocks of rice is roughly 1 m illion tones. The total rice production is about 20-
21 million tons (equivalent to 33- 34 million tons of paddy rice). The amount of public stocks is 
equivalent to approximately one -month domestic consumption.  
Every year, a certain amount of public stocks is sold, and is replaced by new stocks. Purchasing and 
selling prices are based on market price. The re maining public stocks are used for donation, hunger 
relief, or assistance in cases of natural disasters.  
Question 2 
What is meant with "some supports" in footnote 6? Is the support provided in currency or in 
the form of rice? Is there an estimat e of the total quantities concerned?  
Answer:  
This program is aimed at giving support to low-in come people according to the criteria of Viet Nam 
(which specify a much lower threshold than that  set out by the World Bank). All poor people are 
entitled to this program regardless of being farmers or not. Supports are provided in terms of cash or 
in kind depending on local budget. Th is kind of program is in fact a social and welfare program which 
has no distortive effect on production or trade. The reason that this program was included in the Table 
is because 90% of the poor people live in the rura l areas. However, taking the comments made by 
Members of the Working Party, we have re moved this program from the revised WT/ACC/4 
Notification. 
Question 3 
Could Viet Nam please describe th e assistance retirement programs? 
Answer:  
This support program is to support the process of converting agriculture land into other purposes 
(such as forestation, fishery farming etc.). Supports  of this type are provided in terms of money per 
hectare. The amount of money (in the form of payment for seed purchase, land improvement etc.) depends on the specific situation of each locality. 
Question 4 
Could Viet Nam please describe the structural adjustment provided through investment aids?   
Answer: 
 
Structural adjustment program is to support the shift from cultivating crops with low and unstable 
income to other crops with higher income. The form and amount of support vary depending on WT/ACC/SPEC/VNM/3/Add.1 
Page 2  
 
  localities and are disbursed as payments for seed purchase, land improvement, or an amount of cash 
per hectare. 
We have merged this program with the “structural  adjustment through investment aids” program into 
one program titled “Structural adjustment throug h investment aids” in the revised WT/ACC/4 
Notification. 
Question 5 Could Viet Nam please indicate how the meas ure "(I) Other -Job creation program" is in 
conformity with annex 2 the Agreement on Agriculture.  
Answer: 
 
This program is set up by the Ministry of Labours, Invalids and Social Welfares to provide such 
assistance as vocational orientation and preferential lo ans for production development. Subject to this 
program are mainly youths and poor people looking fo r jobs. As this program is mainly implemented 
in the rural areas, it was put in Supporting Tabl e DS:1. However, considering comments made by 
Members of the Working Party, we have re moved this program from the revised WT/ACC/4 
Notification. 
Question 6 Green Box.  In general, these policies seem to fit the relevant criteria of Annex 2 of the 
Agreement on Agriculture.  However, with resp ect to Regional Assistan ce Programmes, we are 
unclear how "transport subsidies" and "freig ht subsidies to offset the high cost of 
transportation of policy commodities and produc tion inputs to mountainous, remote regions" 
fully adhere to the green box provisions.  We wonder perhaps if these should be notified under 
Article 6.2 of the Agreement on Agriculture.  
Answer:
 
The Government provides support for households in poor  and harsh areas which are mainly in remote 
and mountainous regions. Among the support measures is freight subsidy to offset the high cost of 
transportation of agricultural co mmodities such as fertilizer and p esticides to mountainous, remote 
regions, and transportation of majo r products from these regions back to other regions for sales and 
consumption.  
Basis for such program: transport system in mountainous and remote areas is under poor conditions. It 
results in higher transportation costs than in othe r areas.  Meanwhile, the average level of personal 
income in these areas is low as they accommodate mainly ethnic minorities. In this context, transport 
or freight subsidy is necessary to  maintain the equal purchasing and selling prices for people in these 
areas.  
In Viet Nam’s opinion, this program can be classifi ed as “regional assistance program” rather than the 
supports as specified under Article 6.2 of the Agreement on Agriculture. 
Question 7 
Supporting Table DS:1.  Viet Nam has done an excellent job of documenting the measures 
presented in this table.  We only have a few questions.  WT/ACC/SPEC/VNM/3/Add.1 
 Page 3 
 
 
  (a) Could Viet Nam explain how the provincia l decoupled income support payments were 
made?  We understand the eligibility criteria,  but could Viet Nam provide more details 
on how (i.e., on what basis) the payments were calculated, with reference to the specific criteria outlined in para. 6 of Annex 2.  
(b) We note that expenditures are listed for th e categories 'structural adjustment assistance 
provided through resource retirement program s' and 'structural adjustment provided 
through investment aids', but we do not see an explanation of these programs.  Please 
provide information on how these programs op erate and how they meet the criteria of 
paragraphs 10 and 11 of Annex 2. 
(c) Does the 'job creation program' listed under the other category cover all economic 
activities, or just agriculture? 
Answer:
 
(a) Decoupled income support: this kind of program  is aimed at giving support to low-income 
people according to the criteria of Viet Nam (whi ch specify a much lower threshold than that 
set out by the World Bank). All poor people are entitled to this program regardless of being 
farmers or not. Supports are provided in terms of cash or in kind depending on local budget. 
This kind of program is in fact a social and welfare program which has no distortive effect on 
production or trade. The reason that this program  was included in the Table is because 90 per 
cent of the poor people live in the rural areas.  However, taking the comments made by 
Members of the Working Party, we have re moved this program from the revised WT/ACC/4 
Notification. 
(b) Structural adjustment assistance provided through producer retirement programmes: this 
program is to support the process of converting agriculture land into other purposes (such as forestation, fishery farming etc.). Supports of  this type are provided in terms of money per 
hectare. The amount of money (in the form of payment for seed purchase, land improvement 
etc.) depends on the specific situation of each locality. 
- Structural adjustment assistance provided thro ugh investment aids: this program is to 
support the shift from cultivating crops with low and unstable income to other crops 
with higher income. The form and amount  of support varies depending on localities 
and are disbursed as payment for seed purchase, land improvement, or an amount of cash per hectare, etc. 
 Basically, the content of these two programs are similar. However, they were put in 
separate programs as they were classified as different programs in the provinces. We have therefore merged them into one pr ogram titled “Structural adjustment through 
investment aids” in the revised WT/ACC/4 Notification. 
(c) Job creation program is set up by the Ministry  of Labours, Invalids and Social Welfares to 
provide such assistance as vocational orient ation and preferential loans for production 
development. Subject to this program are main ly youths and poor people looking for jobs. As 
this program is mainly implemented in the ru ral areas, it was put in Supporting Table DS:1. 
However, considering comments made by Member s of the Working Party, we have removed 
this program from the revised WT/ACC/4 Notification. WT/ACC/SPEC/VNM/3/Add.1 
Page 4  
 
  Question 8 
We attach great importance to continuing wo rk to progress the development of WT/ACC/4 
tables on domestic support, including through cont inuation of the plurilateral process.  We wish 
to thank Viet Nam for answering many of th e questions raised at the recent agriculture 
plurilateral meeting regarding domestic support and export subsidy tables in 
WT/ACC/SPEC/VNM/3.  Set out below are addition al questions as well as those which remain 
unanswered.  In many cases, we have made sugg estions on the appropriate classification of 
Viet Nam's programs and on amendments that need to be made to the WT/ACC/4 tables.  We would be willing to provide further clarification if required by Viet Nam.  
Supporting Table DS:1
 
Decoupled Income Support: Annex 2, paragraph 6  
Based on the information provided by Viet Nam in the Agriculture plurilateral meeting 
of 16 May, while it is clear that eligibility is based on income criteria, it is still unclear as 
to whether the decoupled income support pr ogram meets the remaining criteria (b) to 
(e) of Annex 2, paragraph 6. Could Viet Nam please provide the following additional 
information: 
- Is this an ongoing program? (While Viet Nam has indicated that farmers receive 
a one-off payment, where this occurs annua lly – it is likely that such a payment 
will affect production decisions, and be distorting as a result?) 
- Where payments are made in kind (in the form of rice) – have these “rice 
payments” been notified elsewhere where appropriate? (such payments are a 
form of market intervention). 
- Does the payment-recipient have to be producing a product in order to receive 
the payment? 
Environmental Programs: Annex 2, paragraph 12  
- Is the amount of payments given to produ cers restricted to the extra cost or loss 
of income in complying with Governme nt requirements? How is this cost/loss 
determined? 
Regional Assistance Programs: Annex 2, paragraph 13  
- Could Viet Nam detail how this program complies with each of the criteria 
(from a – f) listed in Annex 2, paragraph 13? 
Other: Job Creation Program  
- Could Viet Nam provide additional in formation as to how this program is 
administered and outline the criteria for eligibility?  WT/ACC/SPEC/VNM/3/Add.1 
 Page 5 
 
 
  Answer:  
Decoupled Income Support: Annex 2, paragraph 6  
This kind of program is aimed at giving support to  low-income people according to the criteria of Viet 
Nam (which specify a much lower threshold than that  set out by the World Bank). All poor people are 
entitled to this program regardless of being farmers or not. Supports are provided in terms of cash or 
in kind depending on local budget. Th is kind of program is in fact a social and welfare program which 
has no distortive effect on production or trade. The reason that this program was included in the Table 
is because 90 per cent of the poor people live in the rural areas. However, taking the comments made 
by Members of the Working Party, we have removed this program from the revised WT/ACC/4 
Notification. 
Support under this program may be provided in terms of money or in kind, depending on each 
specific locality. It has not been notified under any other item in the Table. 
This support program is consistent with the provisions from a to e of paragraph 6. Annex 2. In other 
words, this program is not dependent on the produ ction output of one par ticular product or capital 
goods. There is no provision requiring bene ficiary to produce a particular product. 
Environmental Programs: Annex 2, paragraph 12  
Data provided in the Table is the full amount of expense to support the implementation of 
Government Program to increase plant-covering rate  over barren and unfertile  land (before 1998) and 
Government Program to plant 5 million hectares of fo rest (after 1998). The purpose of this program is 
not only to cover the extra costs or loss of income  in complying with Government requirements. The 
basis for determining the amount of support is the amount of investment made on each hectare of 
forest for the purpose of planting or improving such forest. The amount of support is small as compared to the amount of investment. Consider ing comments made by Members of the Working 
Party, have removed this program from the revised  WT/ACC/4 Notification because it is a forestation 
program in general.  
Regional Assistance Programs: Annex 2, paragraph 13
 
The Government provides support for households in poor  and harsh areas which are mainly in remote 
and mountainous regions. Among the support measures is freight subsidy to offset the high cost of 
transportation of agricultural co mmodities such as fertilizer and p esticides to mountainous, remote 
regions,  and transportation of major products from these regions back to other regions for sales and 
consumption.  
Basis for such program: transport system in mountainous and remote areas is under poor conditions. It 
results in higher transportation costs than in othe r areas.  Meanwhile, the average level of personal 
income in these areas is low as they accommodate mainly ethnic minorities. In this context, transport 
or freight subsidy is necessary to  maintain the equal purchasing and selling prices for people in these 
areas.  
Viet Nam considers this program as consistent w ith the provisions of paragraph 13, Annex II of the 
Agreement on Agriculture. 
Other: Job Creation Program  
Job creation program is set up by the Ministry of  Labours, Invalids and Social Welfare to provide 
such assistance as vocational orientation and preferen tial loans for production development. Subject to WT/ACC/SPEC/VNM/3/Add.1 
Page 6  
 
  this program are mainly youths and poor people looking for jobs. As this program is mainly 
implemented in the rural areas, it was put in Sup porting Table DS:1. However, considering comments 
made by Members of the Working Party, we have  removed this program from the revised WT/ACC/4 
Notification. 
Supporting Table DS:4 – Calculation of the Total Aggregate Measurement of Support
 
Question 9 
a. By our calculation the product-specific AM S (from supporting tables DS:5 – DS: 7) for 
rice in 1999 and 2000 should not be zero, but  12,164 billion Dong and 6,220 billion Dong 
respectively (refer to comments on Table DS:5). 
b. The Total AMS values for pork  (1999) and cotton (all years) can be equated to zero, as 
the support levels are less than 10 per cent and would be considered as de minimis. As a 
result the values of Total Product Specific AM S and Grand Total AMS will also need to 
be adjusted. 
Answer:  
a. With respect to calculation of support for rice in Table DS:5, there was a typing error. It has 
been corrected in the revised WT/ACC/4 Notif ication. Since 2001, domestic rice price has 
always been below international price. As a r esult, support for rice is calculated as “negative” 
and is reflected in this table as “0”. 
b. Regarding AMS calculation method, Viet Nam ha s notified all available data for  the sake of 
transparency. Viet Nam hopes to  receive assistance from Members so that it can calculate 
AMS in a WTO-consistent manner.  
Question 10 
Supporting Table DS:4.  We appreciate the inclusion of data on value of production and the 
de minimis  calculation.  This is very helpful. 
(a) However, we noticed that some of this data is missing, specifically for plant seeds, 
animal  breeds, and the total value of agricultural production to calculate de minimis for 
the total non-product-specific AMS. 
(b) It would be useful to discuss the appropriate data to use for the value of production for 
plant seeds and animal breeds.  One approach might be to use the aggregate value of production for the crops and livestock products covered by these programs. 
 For example, if the plant variety/seed program covered all crops, then total crop 
production would be used.  If it only c overed certain crops (for example, rice, wheat, 
and corn), then the total value of prod uction of those crops would be used. 
(c) We are ready to work with Viet Nam in the agricultural plurilateral to determine a way 
to develop data on the value of production for these products.  
(d) We wonder if the value of production data and de minimis calculations listed in the row 
'Total product-specific AMS' were misplaced.  If these data represent the value of total 
agricultural production (and de minimis calculation), then they should be moved to the  WT/ACC/SPEC/VNM/3/Add.1 
 Page 7 
 
 
  next row.  Viet Nam does not need to indi cate value of production for total product-
specific AMS, since the de minimis calculat ion is done for each individual commodity. 
If this is the case, we note that the to tal nonproduct-specific AMS is below the de 
minimis level and Viet Nam is not requi red to include it in the total AMS. 
If Viet Nam decides to include it, even if it is below the de minimis level, then Viet Nam 
will have to continue to include nonproduct-sp ecific AMS in its current AMS, even if it 
is below de minimis. 
(e) The word 'grand' before 'Total AMS' can be deleted. 
Answer:  
Viet Nam takes note of the above comments regarding de minimis calculation. It is very difficult for 
Viet Nam to calculate production value for each pa rticular product. Calculation of support provided 
for plant seeds and animal breeds is based on the tota l production of all agricu ltural products because 
support under this program is provided for all kinds of plants and animals. Viet Nam appreciates the 
assistance offered by Members to improve the Table.  
Regarding AMS calculation method, Viet Nam has notified all available data for the sake of 
transparency.  Viet Nam hopes to  receive assistance from Members so that it cam calculate AMS in a 
WTO-consistent manner. 
Supporting Table DS:5 – Product-Specific Aggregate Measurements of Support:  Market Price 
Support  
- Rice  
Question 11 
What is the rice unit used in the calculations: rough or milled?  
Answer:  
It is milled rice. 
Question 12 
What is the reason that price support for rice was not applicable in 2001 (page 14). Did the 
support mechanisms not exist or were the existing support mechanisms not applied?  
Answer:  
In 2001, Viet Nam did not  apply minimum purchase price for rice. Therefore, this program of market 
price support did not exist. 
Question 13 
How is the applied administered price defined? (Column 4).What is the reason for the variation, 
in the applied administered price from one year to another?  WT/ACC/SPEC/VNM/3/Add.1 
Page 8  
 
  Answer: 
 
The applied administered price is the result of th e Government’s supports in order to raise the 
purchase price to protect the benefit of farmers. 
Question 14 
How is the external reference price defined? Is th is the price mentioned in footnote 1 converted 
into Dong?  
Answer:  
“External reference price” is the FOB export pr ice from the port of Ho Chi Minh City and is 
converted from Viet Nam Dong at the av erage exchange rate of each year.  
Question 15 
What is meant by "Eligible production” in column 6? Does this concern the whole of the 
production or part of it? Does it include subsistence production?   
Answer:  
“Eligible production” in column 6 is defined as the total rice production outputs of the year. 
Question 16 
What are the price support mechanisms used?  
Answer:  
Before 2001, Viet Nam applied minimum purchasing price to paddy and quota to rice export for the 
national food security reason. However, the mi nimum purchasing price was always below the 
international price. Viet Nam cons idered this program as market pr ice support (which was “negative”) 
and put “0” in the table. This program has not been used since 2001. 
Question 17 Why is the total market price support (column 8) zero, while there is a price gap and a 
production level indicated?  
Answer: 
 
The result of support calculation was actually negative.  However, there was a typing mistake in Table 
DS:5 where the applied administered price and the ex ternal reference price were put in reverse order. 
We have corrected this error in the revised WT/ACC/4 Notification. 
- Sugar  
Question 18 How is the applied administered price defined and why does it vary so significantly from one 
year to another?   WT/ACC/SPEC/VNM/3/Add.1 
 Page 9 
 
 
  Answer:  
The applied administered price for sugar is the sugarcane purchasing price from farmers and is 
adjusted according to the market situation. 
Question 19 
What is the product unit used in the calculations? Refined or raw sugar?  
Answer:  
The product unit used in the calculations is refined s ugar. Production used in the calculations is the 
total production output of sugar in each year.  
Question 20 
Could you please explain how import licenses co uld operate as a price support mechanism? 
(Footnote 2 page 15).  
Answer:  
Together with the minimum purchasing price, import licenses helped raise the domestic price of sugar 
so as to protect the benefit of sugarcane growers and enterprises doing business in the sugar industry.  
Question 21 
What is the minimum price of sugar (240.000 Dong/t for sugarcane) in raw or refined sugar 
equivalent?  
Answer:  
240 000 VND per tone is the purchasing price app lied when enterprises purchase sugarcane. It is 
defined by the Government to protect the benefit of sugarcane growers.  
Question 22 
Do sugar plants freely choose where to obtain their supplies?  
Answer:  
Yes, sugar plants are free to choose where to obtain their supplies. 
Question 23 
Are there other price support mechanisms for sugar than the ones mentioned in Footnote 2 on 
page 15? If not, what is the function of the applied administered price?  
Answer:  
In addition to price support measure as presented in Table DS:5, there are some other financial 
support measures, such as support to cover commercial interest rates, support to compensate for exchange rate differences, supplement allocation of working capital… as presented in Table DS:7. WT/ACC/SPEC/VNM/3/Add.1 
Page 10  
 
  Question 24 
Supporting table DS:5. (a) For rice, please describe the market price support program that is being notified.  Does 
Viet Nam announce a support price (applied ad ministered price) for rice?  Is all rice 
eligible to receive the support price? 
(b) Why is market price support for rice calculated to be zero in 1999 and 2000, when the 
applied administered price listed is clearly g reater than the external reference price?  
Why was price support not applicable for rice in 2001? 
(c) For sugar, Viet Nam should only use th e market price support program - it cannot 
notify import licensing and authorized/design ated importers as market price support for 
the purposes of these calculations. 
(d) Please explain why the applied administered pr ice for sugar indicated in the table is so 
much higher than the minimum purchase price (240,000 Dong per ton) indicated in footnote 16. 
(e) Please describe the market price support program for sugar, and the years in which it 
has been in effect. 
(f) Does Viet Nam provide market price support for any other products?  We note that in 
supporting table DS:8, Viet Nam makes referen ce to an interest rate subsidy for rice, 
sugar, pork and cotton purchases.  Are ther e minimum purchase prices or other forms 
of market price support provided to pork and cotton? 
(g) We are ready to work with Viet Nam to p repare market price support calculations using 
the methodology outlined in Annex 3 to the Agreement on Agriculture. We are not 
asking Viet Nam to notify programs that do not belong in the domestic support tables 
(such as import licensing and authorized /designated importers).  These should be 
removed from the next revision of Viet Nam’s tables. 
Answer:
 
(a&b) In 1999-2000 period, Viet Nam applied a minimum purchasing price for rice. However, the 
minimum purchasing price for rice was always below the international price. Viet Nam considered this program as market price suppor t (which was “negative”) and put “0” in the 
table. Due to a typing error, it was stated in  the last version of the WT/ACC/4 Notification 
that applied administered price is higher than ex ternal reference price. We have corrected this 
error. In 2001, Viet Nam did not apply minimum purchasing price. 
(c) Viet Nam takes note of the above comments. However, Viet Nam constructed Table DS:5 by 
referring to the experience of other countries, especially the US in this case, where in the 
corresponding Table, the measure was described as “market price support/quota”.  
(d) Indicated in footnote 16 is the minimum pur chase price applied to sugar cane, which is 
different from the sugar price in Table DS:5.  
(e) Market price support applied to sugar is provided by means of minimum purchasing price for 
sugar cane (e.g., 240,000 VND/tone of sugarcan e) and other market intervention measures.  WT/ACC/SPEC/VNM/3/Add.1 
 Page 11 
 
 
  The purpose of this program is to increase the s ugar cane price to a certain level in order to 
help farmers to continue their production.  
(f) Viet Nam applied minimum purchasing price to cotton. Besides the programs which have 
been notified, no other kind of market pr ice support is provided to cotton and pork. 
(g) Viet Nam constructed Table DS:5 by referring to the experience of other countries, especially 
the US in this case, where in the correspondi ng Table, the measure was described as market 
price support/quota.  
However, market price support calculations were still based on the methodology outlined in Annex 3 
to the Agreement on Agriculture and were  not affected by this description. 
Question 25 
Amber Box: Supporting Table DS: 5.  We note th at Viet Nam has not notified market price 
support for rice despite notifying an administered price, external reference price and a quantity of eligible production.  We assume that this is an unintentional mistake. 
We note also that under Viet Nam's sugar regime it has notified its import-licensing scheme as 
part of its market price support.  We would like to point out that these will be discussed in other 
parts of Viet Nam's accession, and should not be  included in market price support calculations.  
We assume that the eligible production figu res provided for rice and sugar in supporting table 
DS: 5 are total production figures and would be gr ateful if Viet Nam could please confirm this.  
In calculating market price support, we would no te that eligible production should be total 
production as all production could potentially  benefit from such a minimum price and would 
refer Viet Nam to the WTO Appellate Body report in the Korea Beef decision. 
Answer:
 
Before 2001, Viet Nam applied minimum purchasing price for rice for food security reasons. The 
minimum purchasing price for rice had always been below the international price. Therefore, the 
result of support calculation was negative. In 2001 , Viet Nam did not apply minimum purchasing 
price. However, there was a typing mistake in Ta ble DS:5 where the applied administered price and 
the external reference price were put in reverse or der. We have corrected this error in the revised 
WT/ACC/4 Notification.  
Regarding sugarcane, investment has only been made  since 1995 for the development of this industry. 
Sugarcane plantation is an infant industry, located mainly in central and highland area (disadvantaged 
regions) and creating jobs for thousands of farmers.  As a result, the industry needs certain level of 
protection. The “market price support” applied to sugarcane has been implemented through minimum 
purchasing price of sugarcane and import licenses. Viet Nam described the import license in order to be more transparent, though it is understood that this  measure should be dealt with in another context. 
However, market price support calculations were still based on the methodology outlined in Annex 3 
to the Agreement on Agriculture and  we re not affected by this description. 
“Eligible production” in Table DS:5 includes tota l production outputs of rice and sugar in the whole 
year. WT/ACC/SPEC/VNM/3/Add.1 
Page 12  
 
  Question 26 
We understand that some of the figures presented are budgeted (i.e., estimated or projected) 
outlays (table DS:5 in particular).  Viet Nam ne eds to identify a 3-year period in which actual
 
expenditures are fully available.  Budget estimates  should not be used.  We are ready to work 
with Viet Nam to address this and other data  issues (i.e., federal versus regional outlays). 
Answer:  
The notified figures in Table DS:5 are actual expend itures. However, we would like to welcome the 
assistance offered by WTO Members to help Viet Nam improve the WT/ACC/4 Notification. 
Question 27 
Supporting Table DS: 5 
- For the calculation of market price suppo rt for rice in the year 2001, where an 
administered price exists (3,036 billion Dong ), it is considered as market price support. 
In this context could Viet Nam explain the meaning of footnote 15? 
- We are pleased to note that in the calcul ation of market price support for sugar, total 
production values have been used as eligib le production. Could Viet Nam confirm that 
similarly the eligible production values for rice are in fact the amount of total rice 
production? 
Answer:  
In 2001, Viet Nam did not apply minimum purchase price for rice. The price level of 2001 (3036 
VND/kg) was the market price, not the applied admini stered price. Viet Nam calculated market price 
support on the basis of total rice production. 
Supporting Table DS:7 – Product-Specific Aggregate Measurements of Support:  Other 
Product-Specific Support and Total Product-Specific AMS  
- Rice  
Question 28 
What do the dots in column 4 mean? (page 17)  
Answer:  
It means that this measure does not exist. 
- Sugar, cotton  
Question 29 Could Viet Nam please describe the measures leadin g to the outlays indicated in column 4 in a 
bit more detail than the information given in the footnotes?  WT/ACC/SPEC/VNM/3/Add.1 
 Page 13 
 
 
  Answer:  
The Government provided support to enterprises and local authorities to import new sugarcane seeds, 
hybrid cotton seeds to achieve higher productivity and quality.  
Question 30 
Has Viet Nam ever considered classifying the measures for "Plant varieties" and "animal 
breeds" in the green box? What were the reasons for classifying in the amber box?   
Answer:  
We have moved this program to the extensi on and advisory services in the Green Box. 
Question 31 
Why is AMS for rice in column 10 zero? (See also question 2.1.7).  
Answer:  
In the 1999-2000 period, Viet Nam applied minimum purchasing price to paddy and quota to rice 
export for the national food security reason. Howe ver, the minimum purchasing price was always 
below the international price. Viet Nam considered  this program as market price support (which was 
“negative”) and put “0” in the table. Th is program has not been used since 2001. 
Supporting Table DS:8 – Product-Specific Equivalent Measurements of Support  
Question 32 Supporting Table DS: 8 - Equivalent Measure of Suppo rt.  Interest rate support to rice, sugar 
and pork :  In terms of the interest rate support for purchases during harvest time, we are a 
little unclear as to how the system operates (why do traders need interest rate support when the 
domestic price drops causing losses to farmers?) , but to us the issue is at what price do 
enterprises purchase products when they obtain p referential loans, and who decides this price?  
It is this price, when compared to the world market price that reflects support to farmers. 
Support for cotton :  We also do not fully understand how the support to cover losses of 
purchasing raw cotton produced by farmers’  policy works and would appreciate further 
clarification.  Moreover, as we understand it, farmers receive a minimum determined purchase 
price, and therefore we wonder if it should be notified as a market price support scheme, and 
shown in supporting table DS: 5.   
Answer:  
- Interest rate support provided to en terprises purchasing rice, sugar and pork:  
During harvest time, agricultural prices often go do wn considerably as the supply of agricultural 
products increases. Rice, sugar and pork are three important products. As a result, they are subject to 
interest rate support. Under this program, the Government provides in terest rate support in order to 
encourage enterprises to purchase ag ricultural products. This program increases agricultural prices 
and, therefore, benefits farmers at the same time (indirect support to farmers). WT/ACC/SPEC/VNM/3/Add.1 
Page 14  
 
  Normally, enterprises purchase these agricultural products  at market prices. Howe ver, when they keep 
purchasing these products in large quantity, the pur chase prices will increase until they reach the 
administered prices. 
How interest rate support is provided: Based on th e movement of prices and market situation, the 
Government decided a plan to support for the purch ase of a certain ratio of the total output (about 1.5 
million tonnes of rice out of 34 million tonnes of tota l output) within a certain period (about 3 to 6 
months). Provincial people’s committees have the authority to select and assign the qualified enterprises (who are financially healthy) to buy in for storage. Selected enterprises have the autonomy 
in selling these products and are responsible for th eir own business performance. In case of losses, the 
Government will consider covering these losses, but not exceeding 70 per cent of  the incurring losses.  
- Support for cotton
: 
In order to protect the benefit of cotton growers,  the Government allows minimum purchasing price to 
be published at the beginning of the crop. Cotton processing factories have to buy all the raw cotton 
produced in that crop. In recent years, internati onal cotton price has been lower than domestic price 
and the Government has to cover the incurring losses. 
However, due to technical difficulty, Viet Nam has not  been able to collect the international price of 
the cotton similar to the domestically grown cotton. As a result, in the revised WT/ACC/4 Notification, we have incorporated this program with the support program for hybrid cotton seeds in 
Table DS:7. 
Question 33 
Supporting table DS:8.   
a. We have several questions about the programs notified in this table, but as a general 
note, we don't think that they should be included in this table, which is to be used for calculations of equivalent measurements of support (the EMS is calculated when market 
price support is provided to a commodity, but the price gap methodology described in 
Annex 3 is not practicable - see Annex 4 to the Agriculture Agreement).  We believe 
supporting table DS:7 would be the appr opriate table for other product-specific 
support. 
b. Please provide more information on the progr am that provides interest rate support to 
trading enterprises to purchase rice, sugar, pork , and cotton.  If these subsidized interest 
rates are provided in conjunction with mark et price support for the commodities in 
question, it would seem that the market pri ce support calculations in supporting table 
DS:4 would capture the full level of support and Viet Nam may not need to notify this 
program separately.  
 Paragraph 8 of Annex 3 states that payments made to maintain market price support, 
such buying-in or storage costs, shall not be included in the AMS. 
c. Please provide more information on the pr ogram that compensates for the differences 
between market and applied exchange rates.  It is not clear to us that this program 
needs to be included in Viet Nam's tables. 
d. Please provide more information on the pr ogram that provides support to develop the 
areas of sugarcane growing (funded by provincial budgets).  WT/ACC/SPEC/VNM/3/Add.1 
 Page 15 
 
 
  e. Viet Nam does not need to include any t ax exemptions or preferences in its supporting 
tables.  Please remove the program that  reduces half of payable VAT liability. 
Answer:  
(a) Viet Nam takes note of the above comments. In the revised WT/ACC/4 Notification, we have 
incorporated this program with the support program for hybrid cotton seeds in Table DS:7. 
(b) During harvest time, agricultural prices often go down considerably as the supply of 
agricultural products increases. Rice, sugar and por k are three important products. As a result, 
they are subject to interest ra te support. Under this program, th e Government provides interest 
rate support in order to encourage enterprises to purchase agricultural products. This program 
increases agricultural prices and, therefore, bene fits farmers at the same time (indirect support 
to farmers). 
 Normally, enterprises purchase th ese agricultural products at market prices. However, when 
they keep purchasing these products in large quantity, the purchase prices will increase until 
they reach the administered prices. 
 How interest rate support is provided: Based on the movement of prices and market situation, 
the Government decided a plan to support for th e purchase of a certain ratio of the total output 
(about 1.5 million tonnes of rice out of 34 million tonnes of total output) within a certain period (about 3 to 6 months). Provincial peopl e’s committees have the authority to select and 
assign the qualified enterprises (who are financially  healthy) to buy in for storage. Selected 
enterprises have the autonomy in selling these pr oducts and are responsible for their own 
business performance. In case of  losses, the Government will consider covering these losses, 
but not exceeding 70 per cent of the incurring losses.   
(c) To implement the sugarcane development program, many sugar refineries have borrowed 
deferred - payment commercial loans from abroad  (nominated in US$) for the importation of 
machinery and equipment. At the mature of these loans (for example in 1999), the Viet Nam 
Dong depreciated in comparison with the US Do llar, increasing those loans in terms of Viet 
Nam Dong as compared to the time they borrowe d. In order to protect the newly-established 
sugar refineries, the Government compensated fo r the difference in exchange rate between the 
time of borrowing and the time of payment. Th is exchange rate compensation program was 
applied in the same manner in 2000 and 2001 . Beneficiaries of this program were the 30 
newly-established sugar refineries throughout the country. 
(d) Many newly-established sugar refineries were short of raw materials for their production. To 
encourage farmers to grow sugarcane as an input  for stable production of sugar refineries, 
local governments have provided financial s upport for land reclamation, seed purchase… for 
sugar cultivation. The amount and form of support depend on the specific locality.  
(e) Viet Nam takes note of this comment a nd has removed this program from the revised 
WT/ACC/4 Notification.  
Question 34 
Supporting Table DS: 8 a. With regard to the interest rate assistance schemes to trading enterprises for rice, sugar 
and pork, could Viet Nam provide additional information on the operation of this scheme to ascertain how it should be classified?  Including: WT/ACC/SPEC/VNM/3/Add.1 
Page 16  
 
  - Are trading enterprises State Trading Enterprises?   
- Do trading enterprises have to purcha se rice, sugar and pork from producers at 
a fixed price?   
- How do traders cover the price gap between the purchase price and retail sale 
price?   
- 50 per cent reduction of payable VAT lia bility – as this program doesn’t appear 
to be market price support, we suggest  that Viet Nam considers re-classifying 
this exemption in Supporting Table DS: 7 as Other Product-Specific Support.   
b. Could Viet Nam provide additional information on the operation of the following two 
programs, and explain why they are being catego rised as EMS?  Should it be classified 
as AMS, non-exempt direct payment or ot her product specific support (i.e. DS:7)? 
- Finance working capital 
- Support to develop the areas of sugarcane growing (funded by the provincial 
budgets) 
c. Support to cover cotton purchases - it is unclear how the support arrangements for 
cotton operate. In footnote 31 Viet Nam has indicated that cotton farmers received a 
minimum determined price – this appears to be an administered price and this 
component of market price support would then  have to be calculated and recorded in 
Table DS: 5. Where assistance is to cover the additional cost to cotton processors then 
this support could be separately and additionally recorded in Supporting Table DS: 7 as Other Product-Specific Support or non-exempt direct payment. (in accordance with 
Annex 3, paragraph 7) 
Answer:
 
a. During harvest time, agricultural prices often go down considerably as the supply of 
agricultural products increases. The Government provides interest rate support in order to 
encourage enterprises to purchase agricultural pr oducts. This program increases agricultural 
prices, and therefore, benefits farmers at the same time (indirect support to farmers). Normally, enterprises purchase th ese agricultural products at market prices. However, when 
they keep purchasing these products in large quantity, the purchase prices will increase until 
they reach the administered prices. 
How interest rate support is provided: Based on the movement of prices and market situation, 
the Government decided a plan to support for th e purchase of a certain ratio of the total output 
(about 1.5 million tonnes of rice out of 34 million tonnes of total output) within a certain period (about 3 to 6 months). Provincial peopl e’s committees have the authority to select and 
assign the qualified enterprises (who are financially  healthy) to buy in for storage. Selected 
enterprises have the autonomy in selling these pr oducts and are responsible for their own 
business performance. In case of  losses, the Government will consider covering these losses, 
but not exceeding 70 per cent of the incurring losses.  
Enterprises subject to this program are not State Trading Enterprises. 
- Do trading enterprises have to purchase ri ce, sugar and pork from producers at a fixed 
price?   
Normally, enterprises purchase th ese agricultural products at market prices. However, when 
they keep purchasing these products in large quantity, the purchase prices will increase until 
they reach the administered prices.   WT/ACC/SPEC/VNM/3/Add.1 
 Page 17 
 
 
  - How do traders cover the price gap between th e purchase price and retail sale price?   
The Government provides support by refunding the amount of payable interests to enterprises 
which borrow from banks to buy in agricultural products for storage. The duration of stock-holding ends after the harvesting time when s upply decreases and prices go up. As a result of 
the increased price, enterprises selling their st orage may not suffer from losses. In case of 
losses due to objective reasons, the Government w ill cover up to 70 per cent of these losses.  
b. In the revised WT/ACC/4 Notification, the program for reduction and exemption of 50 per 
cent of payable VAT liability has been removed. 
Financing working capital: It is stipulated th at State-owned enterprises are allocated 30 per 
cent of their working capital from the State B udget, the remaining part has to be borrowed 
from banks. In practice, these enterprises, esp ecially newly established ones, are not fully 
provided with this amount (30 per cent). S ugar refineries, most of which are newly 
established, are no exceptions. In order to s upport these sugar refineries, the Government 
gives more priority to them during the allocation of working capital. 
Support to develop the areas of sugarcane grow ing (funded by the provincial budgets): Many 
newly-established sugar refineries were short of raw materials for their production. To 
encourage farmers to grow sugarcane as an input  for stable production of sugar refineries, 
local governments have provided financial s upport for land reclamation, seed purchase… for 
sugar cultivation. The amount and form of support depend on the specific locality.  
In the revised WT/ACC/4 Notification, Viet Nam has taken the comments made by Members 
of the Working Party and moved the support programs for sugar (i.e., financing working 
capital, support to develop sugar growing areas) from Table DS:8 to Table DS:7.  
c. In order to protect the benefit of cotton gr owers, the Government allows minimum purchasing 
price to be published at the beginning of the crop. Cotton pro cessing factories have to buy all 
the raw cotton produced in that crop. In recent years, international cotton price has been lower 
than domestic price and the Governme nt has to cover the incurring losses. 
However, due to technical difficulty, Viet Nam has not been able to collect the international 
price of the cotton similar to the domestically  grown cotton. As a result, in the revised 
WT/ACC/4 Notification, we have incorporated this program with the support program for 
hybrid cotton seeds in Table DS:7. 
Question 35 
From a point of view of regulation, can the inte rest rate support indicated for sugar and pork 
not be considered non product-specific?   
Answer: 
 
This program has been moved to Table DS:7. 
Question 36 
Why does the trade need interest rate support when prices to producers fall sharply? On the 
contrary, should there not be a reduced need for li quidity in the trade with, as a consequence of 
falling prices, possibly even lower inte rest rates? (Footnote on page 24).  WT/ACC/SPEC/VNM/3/Add.1 
Page 18  
 
  Answer: 
 
During harvest time, agricultural prices often go do wn considerably as the supply of agricultural 
products increases. As a result, they are subject to  interest rate support. Under this program, the 
Government provides interest rate  support in order to encourage enterprises to purchase agricultural 
products. This program increases agricultural prices and,  therefore, benefits farmers at the same time 
(indirect support to farmers). 
Normally, enterprises purchase these agricultural products  at market prices. Howe ver, when they keep 
purchasing these products in large quantity, the pur chase prices will increase until they reach the 
administered prices. 
Question 37 
Who are the beneficiaries of the compensation  for the differences between market and applied 
exchange rates? For sugar is the 2000 measure identical to the 2001 measure?  
Answer:   
To implement the sugarcane development program, many sugar refineries have borrowed deferred - 
payment commercial loans from abroad (nominated in USD) for the importation of machinery and 
equipment. At the mature of these loans (for exam ple in 1999), the Viet Nam Dong depreciated in 
comparison with the US Dollar, increasing those loan s in terms of Viet Nam Dong as compared to the 
time they borrowed. In order to protect the ne wly-established sugar refineries, the Government 
compensated for the difference in exchange rate  between the time of borrowing and the time of 
payment. This exchange rate compensation progr am was applied in the same manner in 2000 and 
2001. Beneficiaries of this program were the 30 newly-established sugar refineries throughout the 
country. 
Question 38 
How is the 50% VAT exemption operated?  
Answer:  
Reduction of 50% of VAT liability : Most sugar refineries are newly established. They have 
difficulties in capital mobilization, low capacity, high production costs …  The Government provides 
support by reducing 50% of VAT liability for all enterprises of this type.  
Question 39 
Can the measure to finance workin g capital be further explained? 
Answer:  
It is stipulated that State-owned enterprises are allocated 30% of their working capital from the State 
Budget; the remaining part has to be borrowed from banks. In practice, these enterprises, especially 
newly established ones, are not fully provided with this amount (30%). Sugar refineries, most of which are newly established, are no exceptions. In  order to support these sugar refineries, the 
Government gives more priority to them during the allocation of working capital.  WT/ACC/SPEC/VNM/3/Add.1 
 Page 19 
 
 
  Question 40 
What is the minimum purchasing price that cotton plants pay to producers?  
Answer:  
The minimum-purchasing price for cotton is announ ced to all producers from the beginning of the 
crop.   
Supporting Table DS: 9 – Non product specific AMS   
Question 41 Can Viet Nam provide an estimate of the income  forgone for the "incentives relating to land" 
and the "value-added tax incentives"?  
Answer: 
 
We cannot provide the estimates of the income forgone  due to the lack of information and statistics. 
In the revised WT/ACC/4 Notification, these programs have been removed. 
Question 42 
Supporting table DS:9.  As noted earli er, Viet Nam should remove all tax 
preferences/exemptions from the tables.  This would cover the first three programs listed in this 
table. 
Could Viet Nam clarify if budgetary outlays were used for support to cover losses for electricity 
used in irrigation, or are these estimates?  If th ey are estimates, the data should be moved to 
column 4 and Viet Nam should provide calculat ion details.  We are ready to work with 
Viet Nam to provide calculation details if relevant. 
Answer:  
We take note of this comment. In the revised WT/ACC/4 Notification, the program for reduction and 
exemption of 50 per cent of payable VAT liability has been removed. 
As for the irrigation electricity program, the numbers are actual amounts foregone by the 
Government. 
Question 43 Supporting Table DS: 9 - The land-tax exemptions provided for rice and coffee growers constitutes product 
specific support, as it is specific to two pa rticular products, and now generally available 
to agriculture (non-product-specific). We su ggest that Viet Nam re-classifies this 
exemption in Supporting Table DS: 7 as Other Product-Specific Support.  
- Support irrigation fee – could Viet Nam clarify the explanation of this program and 
provide further detail as to how it operates?  WT/ACC/SPEC/VNM/3/Add.1 
Page 20  
 
  Answer:
 
We agree with the suggestion that land-tax exemp tion provided for rice and coffee growers should be 
moved to Table DS:7. However, due to technical difficulties, we have not been able to separate 
statistics for these two different criteria (100 per cent agricultural land use tax-free for extremely 
disadvantaged areas and 50 per cent for those growing rice and coffee). Therefore, we this program is 
still listed in Table DS:9. 
With regard to irrigation fee, it is collected fro m farmers according to the amount of water provided, 
and is used for maintaining irrigation facilities. Ho wever, for a number of re asons (such as for poor 
households, price fluctuations, or bad crops), so me farmers are unable to pay this fee. The 
Government will consider the specific circumstanc es to provide financial support to irrigation service 
providers to cover the cost of maintaining irrigation facilities. 
Supporting Table ES:1 - Export Subsidies:  Outlay and Quantity  
Question 44 What was the quantity of subsidized exports of fruit and vegetables in 2001? What was the 
amount of the subsidy?   
Answer: 
 
Viet Nam has a diversified production of exported fruit and vegetables (including fresh, dried fruits, 
raw and processed products). As a result, it is difficu lt to calculate the total production. In 2001, the 
eligible production of exported fruit and vege table was 330 million USD (450 VND for each USD 
earned from exports, equivalent to 3% of the exported value).  
Question 45 What is the reason for the significant variation  in the unit amount (dong/t) in the- export 
subsidy for pork? 
Is the amount of 7.000.000 dong/t as a pork export subsidy in 1999 correct? This amount 
corresponds to approximately USD 500/t.  Could Vi et Nam please explain why this amount is so 
high and could Viet Nam also explain the subse quent decreases to just USD 100/t in 2001. What 
is the current export subsidy? 
Answer: 
 
In the 1999 – 2000 period, the Government compensa ted for losses arising from exportation of pork to 
Russia when the market was in crises (from 1997 to 1998). During this period, the Rouble depreciated 
greatly, causing bankruptcy for many Russian companies.  As a result, they were unable to pay debts. 
For this reason, the amount of support per each t on of exported products was provided at high level. 
The figure provided (7 million VND/tone, equivalent to 500 USD/ tone) was correct. 
In 2001, compensation policies did not exist. There was only an export reward program applied at 900 
VND for each USD earned from export turnover (equiva lent to 60 - 70 USD/per ton) to the total 
export value of pork.  
In 2002: export subsidies remained.  WT/ACC/SPEC/VNM/3/Add.1 
 Page 21 
 
 
  In 2003: No export subsidies were  granted on export performance (tot al turnovers). Export subsidies 
were only provided to the increased export turnovers as compared to the corresponding export figure of the previous year.  
Question 46 
Supporting table ES:1. 
(a) While this is meant to be a technical discussion of Viet Nam's supporting tables, we 
would reiterate our position that Viet Nam undertake a commitment to bind export 
subsidies at zero upon accession. 
(b) In general, we need more detailed in formation about how the programs listed in 
supporting table ES:1 operate. 
(c) Concerning provision of interest rates support  to rice export enterprises, how does this 
program differ from the program listed in s upporting table DS:8?  This question also 
pertains to pork.  
(d) There a number of references to interest rate  support to assist export enterprises - 
under rice, pork, and coffee - could you explain how these programs operate? 
(e) What is meant by support to cover losses of  rice export transactions?   This question 
also pertains to pork and coffee. 
(f) What is an export bonus?  How is it paid?  We understand that this program was 
cancelled in 2001.  Can you confirm this? 
(g) What is meant by 'export promotion' ci ted under (5) Export bonus upon performance?  
What commodities are covered by this program? 
(h) What is meant by 'provision of support to certain markets' under pork. 
Answer:
 
(a), (b) and (c) 
Viet Nam takes note of this Member’s concer n on Viet Nam’s export support programs and is 
ready to provide related information of th ese programs. Viet Nam commits that export 
subsidies shall be bound at the currently app lied level and shall be subject to reduction 
according to relevant WTO rules upon Viet Nam’s accession. 
Interest rate support for rice exporters: basically , this program is the same as the program in 
Table DS:8, except that the program in Tabl e DS:8 is intended to support stockholding in 
general, while the program in Table ES:1 is  intended to support upon accession  for export 
specifically. 
(d) and (e) 
With regard to rice and pork: this program is the same as the program in Table DS:8, except 
that the program in Table DS:8 is intended to support stockholding in general, while the 
program in Table ES:1 is intended to support upon accession  for export specifically. 
With regard to coffee: In the years 2000, 200 1 and 2002, the world coffee price decreased by 
60 per cent (the lowest price level over the past 40 years). In response to the Coffee 
Temporary Storage Plan of the International Coffee Organization, in 2000 and 2001, Viet 
Nam bought 150,000 tonnes (equivalent to 20 per cent of Viet Nam’s coffee output) for temporary stockholding. The plan, however, fa iled due to several reasons (major coffee 
producing countries all had excessive coffee out put, some countries did not implement the WT/ACC/SPEC/VNM/3/Add.1 
Page 22  
 
  plan …), resulting in lower price. In such circ umstance, Viet Nam had to export this stored 
amount and compensate for the incurring losses. 
With regard to “Support to cover losses of ri ce export transactions”, due to interpretation 
mistake, it should be read as “Interest rate support for rice export transactions with deferred payments”.  
(f) Export bonus is the bonus con tingent upon export performance for some agricultural products 
in order to encourage export.  
Reason: In recent years, prices of agricultural products in the world decreased drastically, 
having considerable influence on domestic pri ces and negatively affecting the socio-economic 
livelihoods of farmers. To encourage export, the Government decided to provide export bonus 
on product-specific basis. The detailed amounts of  export bonus have been presented in Table 
ES:1.  
All the exporters of the above mentioned produc ts with valid documents are entitled to export 
bonus.  
(g) Trade Promotion Support Program (provision of information, database, consultancy, trade fair 
and exhibition, training, market survey, tr ademark promotion...) is to promote export 
activities. This is a separate program from th e Export Bonus Program which is contingent 
upon export performance and is intended fo r agricultural products in general.  
These subsidies are in conformity with Article 6.d. of the Agreement of Agriculture, and are 
allowed for developing countries. For this reason, Viet Nam has removed this program from the revised WT/ACC/4 Notification. 
(h) In the past, export subsidy was only granted to pork exported to Russia. Subsequently, the 
subsidy was also granted to pork exported to Hong Kong. 
Question 
47 
Export Subsidies – Supporting Table ES: 1  
a. Can Viet Nam provide additional information on the operation of the following export 
subsidy programs: 
- Export bonus 
- Export Promotion 
b. We have strong concerns regarding Viet Nam’s introduction of new export subsidies 
during the years 1999 – 2001, as no export subsidies were provided in 1996 – 1997 and only some were provided in 1998.  The intro duction of new export subsidies disregards 
the expectation that acceding countries will not introduce new support measures during 
the accession negotiations (‘standstill principle ’) and is contrary to the effort in the 
WTO to reduce and eliminate export subsidies.  
- Our expectation is that Viet Nam w ill give a commitment to bind export 
subsidies at zero as from the date of accession. 
Answer:
  WT/ACC/SPEC/VNM/3/Add.1 
 Page 23 
 
 
  a. Export bonus is the bonus contingent upon e xport performance for some agricultural products 
in order to encourage export.  
Reason: In recent years, prices of agricultural products in the world decreased drastically, 
having considerable influence on domestic pr ices and negatively affecting  the socio-
economic livelihoods of farmers. To encourage export, the Government decided to provide 
export bonus on product-specific basis. The detailed amounts of export bonus have been 
presented in Table ES:1.  
All the exporters of the above mentioned produc ts with valid documents are entitled to export 
bonus. 
- Trade Promotion Support Program (provision of information, database, consultancy, 
trade fair and exhibition, training, market survey, trademark promotion...) is to 
promote export activities.   
These subsidies are in conformity with Article 6.d. of the Agreement of Agriculture, and are 
allowed for developing countries. For this reason, Viet Nam has removed this program from the revised WT/ACC/4 Notification. 
b. In comparison with the agricultural outputs and export turnovers, export subsidies of Viet 
Nam are negligible. Since 1998, prices of ag ricultural products in the world decreased 
drastically, having considerable influence on dom estic prices and negatively affecting  the 
socio-economic livelihoods of farmers. Viet Nam is a developing country with small-scale 
agricultural production (12 millions of farmer  households, average 0,7 ha/ household), the 
consumption of agricultural products for farmer s is very important. Under the circumstances 
of unpredictable developments in the world ma rket, the maintenance of export subsidies for 
agricultural products shall enable Viet Nam to  keep political and socio-economic situation 
stable. Viet Nam never wants and does not have  enough financial resources to provide export 
subsidies for agricultural products. Therefore,  Viet Nam only provides subsidy with limited 
amount when there is no other options. This e xplains why Viet Nam did not provide subsidy 
in the years 1996 and 1997. 
Viet Nam commits that export subsidies shall be bound at the currently applied level and shall 
be subject to reduction according to relevant WTO rules upon Viet Nam’s accession. 
 
__________ 
  