EVFTA to open up trade opportunities

09:15 | 20/12/2016 Cooperation

(VEN) - On the recent seminar in Hanoi on food safety and market access opportunities for agro-products and beverages industry offered by the EU-Vietnam Free Trade Agreement, domestic and foreign experts identified different opportunities for trade growth between Vietnam and 28 European countries.  

evfta to open up trade opportunities

The successful conclusion of the negotiations for the EVFTA was made in December 2015 and the entire written agreement was published in February 2016. The two sides are expected to officially close the deal in 2017 and the agreement will take effect in 2018.

After the agreement is signed, Vietnam will be able to access the market of 500 million people. In particular, 28 EU members will benefit from opportunities to access the ASEAN market with 630 million people via Vietnam.

Deputy Minister of Industry and Trade Cao Quoc Hung said that the EU was Vietnam’s second largest export market in 2015 worth of more than US$30 billion, accounting for 19 percent of Vietnam’s total export turnover, while being Vietnam’s fifth largest import market with its turnover of over US$10 billion.

According to the EVFTA commitments, the EU will eliminate 86.6 percent of tariff lines after the agreement takes effect, which will account for 70.3 percent of Vietnamese exports to the EU. In the next seven years, the EU will continue to revoke 99.2 percent of tariff lines, which will impact 99.7 percent of Vietnam’s exports to the EU. The remainder will be subject to zero-duty tariff rate quotas. Vietnam will immediately abolish 65 percent of tariff lines on EU goods and more than 99 percent of tariff lines over 10 years. The remaining will be offered tariff quotas with an import duty of zero percent.

The Ministry of Industry and Trade confirmed that Vietnam and the EU have a rich culinary culture with special agricultural products. The difference is among the EU’s temperate climate products and Vietnam’s tropical climate goods. Therefore, Vietnam and EU members will not see direct competition, but enjoy mutual benefits.

With such advantages, the EVFTA will offer opportunities for Vietnam and EU members to promote trade in the coming period.

However businesses in the two sides need to conduct market research to provide products suitable with each other’s consumer demand. In particular, as the EU is a fastidious market with stricter standards of food safety and hygiene, Vietnamese businesses needs to renew their production lines and prepare well for the production’s improvement.

Chu Huynh