EU trade pact offers great opportunities for the agricultural sector

14:47 | 22/09/2019 Economy- Society

(VEN) - The EU-Vietnam Free Trade Agreement (EVFTA) provides a major opportunity for Vietnamese businesses to enter a lucrative market of 508 million people and gross domestic product (GDP) of around US$18 trillion. Agricultural businesses, in particular, are expected to create a breakthrough in order to increase exports and avoid dependence on traditional markets.

eu trade pact offers great opportunities for the agricultural sector
Minister of Industry and Trade Tran Tuan Anh speaks at the conference

Attending a conference titled “EVFTA: Important commitments in the agricultural sector”, Minister of Industry and Trade Tran Tuan Anh said Vietnam made remarkable achievements in agriculture in 2018. However, in the first seven months of this year, export turnover of agro-forestry-fishery products increased by only two percent compared to a year ago, reaching US$23.03 billion. Therefore, speedy implementation of the EVFTA will benefit the agricultural sector.

Luong Hoang Thai, director general of the Multilateral Trade Policy Department under the Ministry of Industry and Trade, said the EU spends a total quota of 80,000 tonnes a year for milled rice, unmilled rice, and fragrant rice entitled to zero-percent tax rate. As soon as the EVFTA comes into effect, half of the EU tariff lines for Vietnamese seafood will be removed, and the remaining tariffs will be abolished within three to seven years under a specific schedule. Tariff lines for fresh and processed fruit and vegetables, juices and fresh flowers will be eliminated.

Pham Thi Hong Hanh from the International Cooperation Department under the Ministry of Agriculture and Rural Development said that in addition to a wide range of tariff benefits, the EVFTA will also help the agricultural sector expand its export markets, diversify the supply of raw materials for agricultural production, provide better access to technology, and improve management capacity.

However, the trade deal also poses many challenges, especially with Vietnam being at the lowest level of development compared to other countries in the region that have signed free trade agreements with the EU. The EVFTA sets out requirements to adjust and amend legal regulations, and has many regulations related to not only product standards, but also the production process.

The Ministry of Industry and Trade and the Ministry of Agriculture and Rural Development have been active in providing information and supporting businesses to raise their awareness and understanding, and coordinating with other ministries and departments to help agricultural firms increase exports and promote market expansion. The two ministries are committed to strictly follow the prime minister’s direction on providing maximum support for businesses in their trade and production activities. In addition, the Ministry of Industry and Trade will strengthen trade promotion activities.

Domestic businesses should make thorough preparations and do careful research of the opportunities and challenges

presented by the trade pact with the EU, and adopt measures to improve their product quality, competitiveness and

productivity.

Thuy Duong & Hoang Ty