Trade deal helps EU,Vietnam firms

06:00 | 20/12/2021 EVFTA

(VEN) - The EU-Vietnam Free Trade Agreement (EVFTA), if exploited to the maximum, will promote trade and investment connectivity for the two business communities.

trade deal helps euvietnam firms
Trade turnover between the EU and Vietnam has increased rapidly since the trade deal came into effect

Strong growth

The EU is one of the Vietnam’s leading partners in development cooperation, its fifth largest trading partner and sixth largest investor. In particular, the EVFTA, which took effect on August 1, 2020, has been providing great opportunities for the two business communities.

Despite the difficulties posed by the Covid-19 pandemic, trade turnover between the EU and Vietnam grew 13.4 percent in the first nine months of the year, reaching US$41.3 billion. Of that figure, Vietnam’s exports to the EU reached US$28.85 billion, an increase of 11.7 percent compared to a year ago, while imports reached US$12.4 billion, a year-on-year increase of 17.6 percent.

Guru Mallikarjuna, managing director of Bosch Vietnam, praised the efforts of the Vietnamese government in streamlining administrative procedures, promoting investment in public administration, improving competitiveness, and finalizing the legal framework to support compliance with international standards. Improvements in the local business environment will greatly benefit the European business community, Mallikarjuna said.

There is still much hard work to be done, such as ratification and implementation of the EU-Vietnam Investment Protection Agreement (EVIPA), Mallikarjuna said, adding that the investment deal will make it safer and easier to scale up investments in Vietnam.

A Decathlon Vietnam representative said Vietnam is and will remain an important manufacturing country. Decathlon’s business plans and production allocation show that business growth in Vietnam will rebound in 2022 and is expected to accelerate in the coming years. Vietnam has a large, young and highly qualified workforce in the manufacturing industry, facilitating the company’s future development, the representative said.

A Sanofi Vietnam representative said the company’s exports to Asian markets reached EUR11 million in 2020. The company has to date invested in a US$75-million modern factory in the Saigon Hi-tech Park (SHTP) and will continue to expand production in Vietnam.

trade deal helps euvietnam firms
Domestic businesses benefit from the EVFTA

Helping EU firms

European Chamber of Commerce in Vietnam (EuroCham) Chairman Alain Cany said the EVIPA will continue its ratification process in Europe. When the deal comes into effect, it will encourage more investments from large European firms, Cany said.

State Bank of Vietnam (SBV) Governor Nguyen Thi Hong expressed her belief that once approved, the EVIPA will further deepen bilateral economic and investment ties.

Over the past two years, thanks to the efforts of the political system and the support of international friends, partners and business communities, Vietnam has overcome the most difficult period posed by the Covid-19 pandemic. The country has switched to safe and flexible adaptation and effective control of Covid-19, restored production and supply chains, maintained macroeconomic stability, and created motivation for rapid and sustainable development.

Hong said the Vietnamese government will create favorable conditions for EuroCham and its members to invest in Vietnam’s priority sectors, such as high-tech, information technology, support industries, smart agriculture, environmental protection, renewable energy, infrastructure, social welfare, training of high-quality human resources, use of science for advanced and effective management, research and development, and innovation.

Vietnam has suggested that EuroCham and the EU Delegation to Vietnam continue accompanying the Vietnamese government to help the country become a truly attractive investment destination.

Thu Phuong