16:58 | 31/08/2015 Trade
(VEN) - The EU and Vietnam announced the basic completion of the EU-Vietnam Free Trade Agreement (EVFTA) after three years of negotiations. According to Head of the Trade and Economic Section of the EU Delegation to Vietnam Jean-Jacques Bouflet, Vietnamese footwear producers should see massive benefits.
Vietnamese footwear exports to the EU should see massive benefits (Photo: Can Dung)
According to the EVFTA, 99 percent of tariff lines would be removed and Vietnam would be freed from 65 percent of export duties at the time after the agreement takes effect, creating opportunities for promoting exports of made-in-Vietnam goods to the EU.
Jean-Jacques Bouflet said that tariffs for Vietnamese garments, textiles and footwear would be reduced to zero percent after seven years.
He also said that the EU was applying the Generalized Scheme of Preferences (GSP) for Vietnamese goods, including footwear. Plus the EVFTA, those items will benefit at the highest level.
According to Vietnam Leather, Footwear and Handbag Association Secretary General Phan Thi Thanh Xuan, thanks to the GSP and the EVFTA, Vietnamese footwear would improve in competitiveness in terms of the EU market. Businesses need to catch this opportunity to promote exports.
However they have to meet new non-tariff barriers such as product quality and corporate social responsibility as it will become increasingly serious. Businesses must strictly comply with these standards, otherwise orders will be refused.
With the presence of new non-tariff barriers, businesses have to strengthen investment in to upgrade their technology and improve product quality and are responsible for the environment and consumers, contributing to benefiting businesses in the long term.
Phan Thi Thanh Xuan also said that Vietnam mainly promotes the export of sports shoes to the EU. Low-quality products are not the sector’s advantage as it requires mass production and China remains leading in its kind of production.
Indonesia and India are the two most famous footwear exporters in the world. However, India focuses on leather shoe exports, while Indonesia has not yet participated in many free trade agreements.
Phan Thi Thanh Xuan said that the EU paid special attention to standards on general product safety through the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) regulation which was adopted to improve the protection of consumer health and the environment from the risks that can be posed by chemicals.
According to the Ministry of Industry and Trade’s statistics, the leather and footwear sector’s export turnover reached US$1.2 billion in July alone and US$7.05 billion in the first seven months of the year, an increase of 27.8 percent and 22.3 percent compared to a year ago, respectively.