EVFTA paving way towards sustainable development in Vietnam
EVFTA paving way towards sustainable development in Vietnam
At the Forum on Trade and Industrial Cooperation with the EU themed "EVFTA – Opportunity for strategic cooperation towards sustainable development", Deputy Minister of Industry and Trade Hoang Quoc Vuong encouraged enterprises on both sides to seize the unprecedented opportunities to work towards sustainable economic development.
The forum aims to advance trade and economic connection between Vietnam and Europe, preparing for enterprises on both sides to embrace the EVFTA
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The forum was broadcast live to 27 domestic and foreign locations such as Hanoi, the southern provinces, and economic and commercial counsellor's offices of the Vietnamese embassy in Europe.
According to statistics from the Ministry of Industry and Trade, Europe has seen bilateral trade turnover increasing by 14 times since 2000, from $4.1 billion to $56.45 billion. On the contrary, Vietnam's export turnover to Europe surged to $41.54 billion last year, expanding 15-fold from $2.8 billion.
In the first five months of 2020, 26 of the 27 European countries invested a total of more than $21 billion into 2040 projects, increasing $553 million over the same period last year.
Deputy Minister Vuong said that the figures prove Europe to be a leading trade partner of Vietnam over the past three decades, ranking as the second export market after the United States.
After 10 years of negotiation and careful consideration, as well as completing ratification procedures, the EVFTA will officially come into effect on August 1, 2020, benefiting the business communities of both sides. The EVFTA is the first agreement that Europe has signed with a developing country in Southeast Asia.
This new-generation agreement also provides Vietnam with unprecedented benefits. For example, Vietnam commits to eliminate import duties on 48.5 per cent of tariff lines, equivalent to 64.5 per cent of EU exports. After seven years, import taxes on 91.8 per cent of tariff lines will be removed by Vietnam, equivalent to 97.1 per cent of EU exports. After 10 years, the elimination rate will be 98.3 per cent of the total tariff lines, equal to 99.8 per cent of the EU’s exports.
Similarly, nearly 100 per cent of Vietnam’s exports to the EU will see import tax eliminated after 10 years. So far, this is the highest level of commitment a partner has given Vietnam in a trade agreement.
The two sides have committed to open and welcome investment into new areas like trade, sustainable development, and government procurement, in addition to attractive fields like banking and finance, digital trade, and logistics.
The agreement expands the market for export products, especially competitive products such as tropical products, seafood, automobiles, and materials for footwear, textile, and garment. It also offers European investors priority in the Vietnamese market.
The World Bank forecasts the global economy to fall by 5.2 per cent in 2020, including a 7 per cent fall in developed countries and 3 per cent in emerging and developing markets.
Deputy Minister Vuong stated that, “It is anticipated that COVID-19 and its impacts will last long into the future. The EVFTA will enhance the investment and trade partnership between Vietnam and Europe. However, we have to frankly admit that the agreement is not the only hope for the Vietnamese economy amidst the COVID-19 pandemic. The true conditions for a breakthrough will come principally from our inner strength and enterprises’ determination to renew themselves."
