15:30 | 04/06/2015 Trade
The recent conclusion of the free trade agreement (FTA) between Vietnam and the Eurasia Economic Union (EAEU), comprising of Russia, Belarus, Kazakhstan, Armenia, and Kyrgyzstan, is expected to offer both opportunities and challenges to Vietnamese business players.
In an interview granted to the Vietnam News Agency, Minister of Industry and Trade Vu Huy Hoang highlighted the significance of the trade pact, the first of its kind struck between the union and an outside partner, which covers almost all commerce and investment fields from trade in goods and services, investment services, finance and banking to science-technology services, e-commerce, intellectual property, environmental protection and Government purchase.
The most important result of the deal is the opening of the goods market and investment services, the minister said, adding that the advantages of each side are supplementary. Vietnam has strength in farm produce, seafood, garment-textiles, footwear and food processing, while the EAEU, particularly Russia , boasts huge potential in mineral resources and mechanical products.
Trade between Vietnam and Russia is expected to top US$10 billion by 2020 thanks to the liberalisation of up to 90% of the tax line and 90% of the import-export turnover, he said.
However, the minister also pointed out some challenges, such as the stable quality of products, especially Vietnamese farm produce like tea and coffee; the strict requirements of EAEU markets; the geographical distance that requires a suitable transportation roadmap and connection with other markets; and the complicated payment methods required.
The limited understanding of Vietnamese businesses about the EAEU market, especially small-scale economic members like Armenia and Kyrgyzstan, is worrisome, he said, adding that local firms should study the market’s consumer tastes when seeking investment opportunities there.
The Ministry of Industry and Trade will promote its role in linking domestic firms with international partners, while cooperating with the press – including the Vietnam News Agency, the Voice of Vietnam, the Nhan dan (People) Newspaper, and the Department of Popularisation and Education, to disseminate Vietnam’s commitments to international economic integration as well as opportunities and challenges of the Vietnam-EAEU free trade pact.
The ministry is willing to support enterprises with information relevant to business contracts with the EAEU. It will also organise trade and investment promotion events and fact-finding tours to foreign countries, while working with the State-run agencies and EAEU offices to properly deal with any disagreements between businesses in the spirit of ensuring the interests of the involved parties, he said./
Source VOV News