Viet Nam firms should take advantage of EVFTA to boost exports to Germany
Viet Nam firms should take advantage of EVFTA to boost exports to Germany
Vietnamese enterprises need to take advantage of the European Union-Viet Nam Free Trade Agreement (EVFTA) to increase trade value, according to the Viet Nam Chamber of Commerce and Industry (VCCI).
At the webinar on promoting trade between Viet Nam and Germany through the EVFTA held in Ha Noi on yesterday, Hoang Quang Phong, VCCI vice chairman said being a new-generation FTA with high liberalisation, the EVFTA would eliminate most of the tariff barriers and reduce non-tariff barriers between Viet Nam and the EU, including Germany.
Therefore, the bilateral trade between the two countries is expected to see breakthrough growth in the future. Specifically, the agreement will remove 99.2 per of tariff lines for Vietnamese goods exported to Germany after seven years of the deal taking effect. About 98.3 per cent of tariff lines for German products imported to Viet Nam would be eliminated after 10 years of the deal taking effect.
The EVFTA also protects geographical indications for 39 Vietnamese products and 12 German products, helping brand and product value to increase in the markets of the two countries, Phong said.
In addition, the agreement also includes many other commitments on customs, sanitary and phytosanitary measures, technical barriers, trade remedies, e-commerce, intellectual property and public procurement, to create favourable conditions for Vietnamese and German goods to access their markets.
Viet Nam's export products have great opportunities from the EVFTA include footwear, garment, seafood, plastic products, fruits, rice, sweetcorn, garlic and mushrooms.
Local enterprises would take advantage to import many German products such as vehicles, electrical machinery and equipment, pharmaceuticals, plastic products, iron and steel, fuels, animal and poultry meat, milk and dairy products, alcohol and beverages.
At the conference, Nguyen Cam Trang, deputy director of the Ministry of Industry and Trade (MoIT)’s Import-Export Department, said in the first year of carrying out the EVFTA, Viet Nam has taken export opportunities to sharply increase many key export products to Germany such as machinery and equipment (up by 83.6 per cent), vehicles and spare parts (71.6 per cent), iron and steel (53.2 per cent), computers and electronics (34 per cent), and seafood (15.5 per cent).
According to VCCI, after 10 years of establishing the Vietnam-Germany strategic partnership (2011 - 2021), the bilateral trade value has increased sharply from $5.6 billion in 2011 to $10 billion in 2020. Of which, exports from Viet Nam to Germany achieved a growth rate of about 11.5 per cent each year.
However, the trade value with Viet Nam has accounted for only 1.83 per cent of Germany's total trade value, much lower than 24.41 per cent with China, 16.65 per cent with the US and 12.11 per cent with South Korea.
To promote exports to Germany, Vietnamese businesses need to understand the commitments in the EVFTA and know demand and the import and export regulations of this market, said Cam Trang from MoIT.
Therefore, the VCCI collaborated with Friedrich-Naumann Institute for Freedom (FNF) in Viet Nam to organise this conference on December 14 providing information on the EVFTA and investment and business opportunities with Germany for local enterprises.
At the same time, VCCI has also compiled a book on using the EVFTA to enhance goods import and export between Viet Nam and the German market and built a website about the German market for local enterprises, said Nguyen Thi Thu Trang, director of the VCCI’s Center for WTO and Integration.
Also at the conference, Thu Trang introduced specific requirements on import and export procedures of the German market. This is a part of activities on giving support to local enterprises to take advantage of the EVFTA.
Cam Trang from the MoIT said “the market information is very important. The MoIT with its network of trade offices in foreign countries has been providing market information and foreign partners to domestic enterprises. They will also support domestic enterprises to connect with foreign partners in trade and investment activities.”
In addition, other MoIT agencies such as the Import-Export Department and the Trade Remedies Authority are also ready to assist the businesses in the production and import and export of goods, and trade lawsuits.
Pham Hung Tien, FNF Viet Nam deputy director, said that Germany has seen many investment and trade opportunities with Viet Nam, including some new fields such as green energy. For many years, German enterprises have developed many wind power projects in Viet Nam.
“In the future, German enterprises will continue to be interested in wind power development projects in Binh Thuan and Ninh Thuan. These are also factors to promote investment and trade activities,” Tien said.
In addition, the vocational training also offers the prospect of attracting investment from Germany. With more than 20 years of cooperation in vocational training with Viet Nam, German enterprises believe that Viet Nam has a young workforce and they need to improve their skills for many jobs, he said.
According to Tien, qualified workers would help local enterprises receive new German investment for projects such as the mechanical engineering sector. This will create added value for local products or develop domestic enterprises to become suppliers of German enterprises.
The German enterprises also are looking forward to investment in Viet Nam to transfer technology, improve skills for manufacturing factories, and provide auto components and accessories for German enterprises in Viet Nam.
For trade, Tien said Vietnamese businesses should enhance participation in fairs held in Germany because German businesses often seek trade partners at these fairs.
In addition, domestic enterprises can directly contact the local chambers of commerce and industry in Germany to find commercial partners.
