06:10 | 27/08/2020 EVFTA
(VEN) - The EU-Vietnam Free Trade Agreement (EVFTA) officially took effect on August 1, opening up numerous opportunities to promote trade and expand investment for the two business communities.
Turning point for economic growth
Economic and trade relations between Vietnam and the EU have been continuously expanding, with two-way trade turnover increasing from US$4.1 billion in 2000 to US$56.45 billion in 2019. Vietnamese exports to the EU last year reached nearly US$41.5 billion and imports from the EU stood at over US$14.9 billion. Regarding investment, 26 out of 27 EU countries had invested in Vietnam in the first five months of the year, with 2,040 projects worth US$21.66 billion, up US$553 million compared to the same period last year.
At a forum on trade and industrial cooperation with the EU held by the Ministry of Industry and Trade on July 31 in Ho Chi Minh City, Deputy Minister of Industry and Trade Hoang Quoc Vuong said the figures prove that the EU is a leading trade partner of Vietnam.
The EVFTA will eliminate virtually all tariffs on goods traded between the two sides. However, in addition to benefits provided by the trade deal, Vietnam will face strict technical barriers and enforcement standards. Therefore, businesses need to understand the trade deal carefully by participating in information dissemination programs, conferences, seminars and training courses.
Different market characteristics
Deputy Chair of the European Chamber of Commerce in Vietnam (EuroCham) Jean Jacques Bouflet said Vietnam has made remarkable progress in the past few decades in streamlining conditions, improving the business environment and modernizing its legal framework. EuroCham is ready to organize dialogues to help Vietnam simplify procedures, making EVFTA implementation most effective. “The challenge in the future is to ensure the smooth and effective implementation of the EVFTA. Although the Vietnamese and EU authorities have provided legal tools, EVFTA’s success will depend on efforts from both sides,” Jean Jacques Bouflet said.
The EVFTA came into effect even as the world is combatting the Covid-19 pandemic, which has resulted in sharp global economic decline. Vietnamese Trade Counselor in Belgium and the EU Tran Ngoc Quan said the Covid-19 pandemic has reshaped the world and trade policy. Therefore, businesses need to be active and ready to respond to change. The EU has many strict barriers, and Vietnam needs to ensure that enterprises do not take advantage of the trade deal to introduce non-Vietnamese products to the EU.
Vietnamese Trade Counselor in Sweden Nguyen Hoang Thuy said each EU country has different characteristics, so that Vietnamese exporters need to focus on niche markets. For example, Eastern European countries, where many Vietnamese people live, are gateways for Vietnamese goods to penetrate the EU market.
|The Ministry of Industry and Trade together with Vietnamese trade offices abroad will make greater efforts to accompany businesses in order to utilize export opportunities provided by new-generation free trade agreements that Vietnam has signed.|
Thao Duong & Thanh Minh