EU aims to be largest investor in Vietnam

Vietnam and the EU are working hard to accelerate the signing of the EVFTA. When will the EVFTA be signed?

The EVFTA is expected to be signed before the summer of this year and then will be approved by the European Parliament and the Vietnamese National Assembly. There was a plan for the signing to take place in December 2017. However, it was delayed due to a longer process of legal scrutiny by the two sides’ experts, the EU restructuring, and the European Court of Justice decision that free trade agreements between the EU and other countries require ratification by national and regional assemblies.

I think the EVFTA will be signed soon without problems. The difficulty will only be waiting for the approval of the European Parliament and the Vietnamese National Assembly.

Good preparations are needed to help the EVFTA prove its efficiency. Some 20 European experts have been dispatched to assist Vietnam in the preparations. There will be a lot of technical work to do in May and June this year.

How will the EU’s investment flow into Vietnam, and structure of trade exchange, change?

The signing of the EVFTA is a positive sign, showing that Vietnam is an attractive destination in the eyes of European investors. In the ASEAN region, the EU only has a free trade agreement with Singapore, and Vietnam will be the second. The EU is considering the signing of free trade agreements with other regional partners like Thailand, Indonesia and the Philippines. Compared to Singapore, Vietnam has an advantage in terms of human resources. Compared to other ASEAN partners, Vietnam has an advantage of signing in advance. It is likely that the EU’s investment flow into Vietnam will increase after the EVFTA is signed and takes effect. We are aiming to be the largest investor in Vietnam instead of the fifth position as present.

The EU has a negative balance of trade in goods with Vietnam, and it could be slightly improved after the EVFTA takes effect. As Vietnam’s exports to the EU are mostly low added value items, we will support Vietnam in producing higher added value products such as finished clothing and electronic items. In the last five years, Vietnam’s electronic products to the EU have been made by Samsung. I hope Vietnam will be able to produce more locally assembled products. For the EU, we hope to boost exports of engineering products, chemicals and consumer goods to Vietnam, and the country is expected to become the EU’s gateway to the ASEAN market.

What are the EU’s plans for Vietnam?

The EU is one of the largest official development assistance (ODA) donors for Vietnam. The EU is providing technical assistance for Vietnam in trade and public finance.

When preferential ODA packages from the World Bank and the Asian Development Bank to Vietnam are terminated, the EU can completely continue to support Vietnam.

The EU will also provide specific support programs for Vietnam. I am preparing to sign a letter to send to the minister of industry and trade concerning the EU’s support for Vietnam during the EVFTA implementation period. This includes improving the quality of Vietnam’s agricultural products in exports to the EU market, promoting branding for Vietnamese goods and enhancing capacity of small and mediums-sized enterprises. The EU is also interested in supporting Vietnam in ensuring energy efficiency.

What is your message for the Vietnamese business community?

Vietnam and the EU have witnessed stable socioeconomic development. In particular, 2018 will be a successful year for the two sides when the EVFTA is signed and comes into force. Accordingly, many new areas of cooperation between the two sides will be promoted, and businesses of both sides should make the most of these opportunities. I hope the two sides will further strengthen cooperation in education and tourism. On the occasion of the Lunar New Year, I want to extend my sincere New Year’s greetings to everyone.