Vietnam’s FTA with EU goes beyond other pacts: minister

By Staff reporters   July 3, 2018 | 04:11 pm GMT+7
Vietnam’s FTA with EU goes beyond other pacts: minister
Vietnam's export value to EU could reach $16 billion if the EVFTA goes into effect next year. Photo by AFP

The deal could increase the value of Vietnam’s exports value into the EU to $16 billion in the first one or two years.

Vietnam’s free trade agreement with the European Union goes beyond all other trade pacts in enabling exports, and the nation should reap due benefits, says Industry and Trade Minister Tran Tuan Anh.

If the EU-Vietnam Free Trade Agreement (EVFTA) goes into effect next year, Vietnam’s exports to the bloc could rise by as much as 4-6 percent a year in the first 10 years, he told the media recently.

Up to 99 percent of Vietnamese products exported to the EU would be free of tariffs once the deal goes into effect, the highest tariff-free rate for exports that Vietnam has ever achieved in any FTA, the minister said.

He said the deal would provide new opportunities for Vietnam to increase exports of clothing, seafood and agricultural products.

“The products that we could not export before due to high tariffs can now be exported to the EU market with more competitive prices,” Anh said.

If the EVFTA goes into effect next year, exports from Vietnam into the EU could increase by $16 billion in the first one or two years, and reach $75-76 billion in 2028, he said.

The deal would also benefit the EU, increasing the region’s income by $34.4 billion in the long run.

Cecilia Malmström, European Commissioner for Trade, said the deal also provides a big opportunity for European exporters.

“We hope to finish processing this free trade agreement quickly so that businesses, workers and consumers alike in the EU could reap benefits as soon as possible,” she was quoted by the WTO Report Center under the Vietnam Chamber of Commerce and Industry (VCCI) as saying.

Minister Anh said he recognized that signing of the EVFTA would also give rise to several challenges.

“There would certainly be competitive pressure in the farming and automobile sectors. But that’s not unusual,” Anh said.

Vietnam expects the deal to be signed at the end of this year and be ratified in the beginning of next year, he added.

“Parties have finished the legal review process and reached an agreement on the EVFTA and the Investment Protection Agreement (IPA),” said the minister.

The IPA is a separate agreement on conflict resolution between governments and investors.

Vietnam is the second country in the Southeast Asian region after Singapore with which the E.U. has reached a free trade agreement.

Last year, trade turnover between Vietnam and the EU reached $51 billion, in which Vietnam’s exports to EU reached $38.3 billion and EU’s exports to Vietnam reached $12.1 billion.

 
 
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