Yesterday, from the Hongkong TDC, it was informed that because the European Union believed that the Vietnamese footwear industry had always been highly competitive in the European market, it would abolish the preferential tax treatment for its shoes before the end of this year.

The TDC believes that this move is worth the attention of Hongkong shoe manufacturers, because many Hong Kong businessmen are considering the relocation of production bases from Vietnam's increasingly expensive PRD to Vietnam next year to produce exports to the EU.

According to GSP, the EU will provide unilateral tariff preferences to developing countries.

The representative of the EU office in Vietnam explained that if the value of exports to the EU by a beneficiary country (such as Vietnam) accounted for 15% of the total value of the same products exported to all EU countries, that means that the relevant industries in the country were sufficiently competitive and no longer needed to give preferential treatment.

Over the two years ended 2006, the average value of Vietnam's shoe exports covered by GSP accounted for 19.9% of all EU shoe imports under the same tax system.

In addition, the average value of the total value of Vietnam's exports to the EU is 49.1%, which is also in line with the minimum requirement for the EU to abolish the GSP treatment in a country.