Business opportunities between EU and Vietnam essential for recovery

Business opportunities between EU and Vietnam essential for recovery

Both the EU and Vietnam have in hands required tools to ensure the bilateral relations’ long-term prospects.

Coming out of a global crisis, this is the time for businesses from both the EU and Vietnam to grasp opportunities to recover and thrive.

Overview of the event. Photo: Hai Yen

EuroCham Chairman Alain Cany expressed his view at the event Meet Europe 2021: EU-Vietnam Partnership Post Covid and 2021 Whitebook Launch held today [November 25].

According to Cany, Vietnam’s exports to the EU expanded by 11% during the first 12 months since the EU-Vietnam Free Trade Agreement (EVFTA) became effective in 2020, while its imports from the EU also rose by 12%.

The result as Cany said, is encouraging amid the Covid-19 pandemic, “but also just the beginning.” As both sides are turning to a new phase in the fight against the pandemic, he said the most important issue would be to focus on realizing the trade and investment potentials between Vietnam and the EU.

“Our objectives are not only to survive in the post-pandemic but to thrive,” he stressed.

In this regard, Cany referred to the EVFTA and the upcoming EU-Vietnam Investment Protection Agreement (EVIPA) as the platforms to ensure the long-term prospects of the EU-Vietnam relations.

“In the next decade, we are going to witness the reopening of markets and declining tariffs, which would pave the way for a new wave of cooperation between the two business communities,” he said.

Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong added the EU remains Vietnam’s fifth-largest trading partner and sixth-largest investor.

Hong considered the EVFTA a major milestone in Vietnam-EU relations, evidenced by a 20% increase in bilateral trade relations during the first ten months of this year.

“The Vietnamese Government is committed to creating every condition for European businesses to further invest in Vietnam, especially in priority fields of hi-tech farming, supporting industries, renewables, infrastructure, and high-quality human resources training,” Hong said.

Sharing Hong’s view, Giorgio Aliberti, ambassador of the EU to Vietnam, stressed the EVFTA is a major policy framework to mitigate risks and instability in doing business for both sides, which is especially important during the pandemic.

Aliberti referred to a recent survey conducted by EuroCham that more than 60% of its members expected the deal to bring positive impacts, but also noted 35% expressed concern over administrative procedures as a barrier to the EVFTA implementation.

To further attract FDI from European businesses, Aliberti suggested the Vietnamese Government continue revising investment procurements to remove obsolete regulations.

The Ambassador expected the country’s business environment to be fully compatible with market mechanisms without discrimination between domestic and foreign companies.

EU businesses expanding investment in Vietnam

Representative of France-based sportswear company Decathlon Vietnam noted the firm made inroad in the country since 1995. In 2020, the company churned out over 150 million products that were delivered to stores in 60 countries around the world.

For Decathlon, Vietnam remains its second-biggest production hub globally, and continues to be significant despite the pandemic, he said.

He proposed the authorities give priority to vaccinating workers in its factories and ease mobility restriction for those fully vaccinated.

According to the representative, Vietnam should accelerate the localization process in manufacturing and processing, noting this could bring positive impacts for the supply chains in Vietnam.

In addition, there should be more incentives to encourage local producers to shift to automation to achieve greater productivity, he added.

Guru Mallikarjuna, managing director of Bosch Vietnam, highlighted the efforts of the Vietnamese Government in containing the pandemic and boosting growth.

Mallikarjuna noted the company is fully committed to investing long-term in Vietnam and called for the Government to improve the logistics chains for greater economic competitiveness.

Revealing the plan to turn Vietnam into one of its leading R&D centers, Mallikarjuna said the company is expected to expand investment activities in the country in the next five years, including the setup of new branches in Hanoi, Ho Chi Minh City, and scale up operation at the factory in Dong Nai.

Hanoi Times