E-Malt.com News article: Vietnam: Brewing industry to spend a lot on stamps requested for brewery products by the government

Vietnam’s Ministry of Industry and Trade (MOIT) has requested brewery enterprises to stamp their products, a solution the ministry believes is important to avoid trade fraud, VietnamNet Bridge reported on May 19.

Breweries say they would have to spend VND700 more on every product made. They do not believe the stamp will help prevent trade fraud and increase state management capability.

According to the Vietnam Association of Beverage & Alcohol, there are over 100 alcohol and brewery manufacturers in Vietnam which run 200 beer production lines.

If they have to stamp their products before putting them for sale in the market, they would have to spend about VND3 trillion to buy stamping machines (VND15 billion for each). The will also have to pay for regular expenses to run the machines.

Enterprises will also have to spend money to buy stamps, VND200 for each, which means enterprises will have to spend VND2 trillion on stamps alone.

Regarding the management cost, the association estimates the figure could be up to VND1 trillion.

As such, if the stamping is required, enterprises will have to spend VND700 more for every product.

With the brewery industry churning out 10 billion products per annum, enterprises will have to spend VND7 trillion more on production cost, which means the profit would decrease by VND7 trillion. Meanwhile, the tax sum to be paid to the State is estimated to decrease by 1.5 billion.

According to Le Hong Xanh, general director of Sabeco, the operating 25 breweries of Sabeco would have to spend VND700 billion on stamping machines, and would have to buy 6 billion stamps a year, worth VND1.2 trillion.

Sabeco would also have to pay more for management cost and labor force.

“If so, the production cost will be higher, thus badly affecting production, sales and the tax payment to the state,” he said. Sabeco now pays VND13 trillion a year in tax to the State.

Meanwhile, the chair of the Vietnam Beverage & Alcohol Association Nguyen Van Viet commented that there was no need to stamp brewery products because the products controlled by strict regulations stipulated in legal documents.

“The stamping will not help much in fighting against smuggling and preventing counterfeit goods,” Viet said.

The initial plan on developing the beverage & alcohol industry said Vietnam would produce 4 billion litres of beer by 2015 and 6 billion litres by 2025.

However, MOIT, after considering the real production capacity, has decided to cut the expected beer output to 3.5 billion litres and 5.5 billion litres by 2015 and 2025, respectively.


20 May, 2015