Businesses cheer European ratification of unique trade pact with Vietnam

09:10 | 29/02/2020 Cooperation

(VEN) - Vietnam Economic News’ Thu Hang, Nguyen Hanh and Thuy Duong sought the opinions of experts and businesses on the European Parliament (EP)’s ratification of the EU-Vietnam Free Trade Agreement (EVFTA) on February 12.

businesses cheer european ratification of unique trade pact with vietnam
Deputy Minister of Industry and Trade Do Thang Hai

Deputy Minister of Industry and Trade Do Thang Hai: Businesses must formulate strategies to utilize the EVFTA

Vietnam’s export turnover in 2019 saw a record high thanks to market openings, especially the effects of new-generation free trade agreements (FTAs). In fact, Vietnam has made good use of the advantages provided by FTAs.

As for the EVFTA, we are working to disseminate information regarding the advantages provided by the trade pact, aiming at increasing business awareness of its opportunities.

We also hope localities, associations and businesses will adopt strategies for export products and markets.

However, export turnover will not increase naturally with the effects of the EVFTA, especially for agricultural products. Businesses must ensure product quality and must meet the strict regulations of the market.

businesses cheer european ratification of unique trade pact with vietnam
Vo Tri Thanh, director of the Institute for Brand and Competitiveness Strategy

Vo Tri Thanh, director of the Institute for Brand and Competitiveness Strategy: The EP ratified the EVFTA quickly

The EP ratified the EVFTA quickly, creating favorable conditions for Vietnam’s economic development. Vietnam needs to continue promoting economic restructuring and helping business compete more effectively and take advantage of more opportunities offered by the EVFTA.

When the EVFTA takes full effect, the country’s export tariffs on many products will instantly be slashed to zero percent. However, businesses must have plans to implement the restructuring in order to make the most of opportunities provided by the trade pact.

businesses cheer european ratification of unique trade pact with vietnam
Pham Xuan Hong, Chair of the Saigon 3 Garment Joint Stock Company

Pham Xuan Hong, Chair of the Saigon 3 Garment Joint Stock Company: Expectations from the EVFTA

Like many other industries, the garment and textile sector is facing a shock due to the Coronavirus disease 2019 (Covid-19), resulting in a temporary raw material supply interruption. Although businesses have prepared fabric for the whole first quarter, a supply shortage is likely. The ratification of the EVFTA will help diversify supply sources and avoid dependence on certain markets.

When the EVFTA takes full effect, we expect the company’s 20-percent growth target in 2020 will be achieved.

businesses cheer european ratification of unique trade pact with vietnam
Tran Quoc Manh, board chairman of the Saigon Trade and Production Development Corporation (SADACO)

Tran Quoc Manh, board chairman of the Saigon Trade and Production Development Corporation (SADACO): Increasing access to modern machinery and distribution channels

The EVFTA will benefit Vietnam’s timber industry both by reducing export taxes and by providing access to modern machinery and equipment, as well as to EU distribution channels. However, in addition to the advantages, wood businesses will also face challenges because of technical barriers, including the source of wood materials for production.

SADACO has made careful preparations to meet EU standards. We expect the company’s exports will increase thanks to tax reduction and market expansion.

businesses cheer european ratification of unique trade pact with vietnam
Phung Thi Thu Huong, general director of Green Path Vietnam

Phung Thi Thu Huong, general director of Green Path Vietnam: Businesses should understand fully and comprehensively the contents of the EVFTA

Seven years after the trade pact enters into force, the EU will abolish 99.2 percent of tariff lines, equivalent to 99.7 percent of Vietnam’s export turnover. To make good use of the opportunities provided by the trade pact, businesses need to be active in studying and understanding the contents of the EVFTA fully and comprehensively since it includes strict regulations on technical standards, intellectual property and sustainable development.

Thu Hang, Nguyen Hanh & Thuy Duong