Vietnam hoped to become EU’s largest trade partner in ASEAN

Export potentials 16:15 08/08/2017
Vietnam is expected to become the EU’s largest trade partner in the Association of Southeast Asian Nations (ASEAN) once the EU-Vietnam Free Trade Agreement (EVFTA) comes into effect in 2018, according to Minister of Industry and Trade Tran Tuan Anh.

The minister said Vietnam could also become the most promising destination in Southeast Asia for European businesses.

According to the Ministry of Industry and Trade (MoIT), the country may serve as an entry point for EU trade to ASEAN.

Once effective, the EVFTA will encourage investment from the EU into Vietnam and create opportunities for the two sides to access each other’s market, the ministry said.

The EU will eliminate about 85.6 percent of tax lines on Vietnam’s exports, with the rate increasing to 99 percent seven years later.

Meanwhile, Vietnam will liberalise 65 percent of import duties on EU exports. In another 10 years, about 99.8 percent of EU goods exported to Vietnam will enjoy a zero percent tax rate.

Statistics released by the MoIT show that the Vietnam-EU trade grew by 8.93 percent in 2016 compared with the previous year to reach 45.07 billion USD.

Bilateral trade expanded by 16.2 percent year-on-year in the first five months of 2017.

Of the figure, Vietnam’s exports to the EU rose 4.2 percent, mostly apparel, footwear, agro-forestry-aquatic products and computers, while its imports from the EU rose 14 percent, including machinery, equipment, pharmaceuticals and dairy products.

The country’s major importers were Germany, the UK, France, Italy, the Netherlands and Spain.

With a population of more than 500 million, the EU is an attractive market for Vietnamese products like garments, garments-textiles, seafood and coffee.

With the two sides’ commitment to opening up the market, two-way trade revenue is hoped to hit about 100 billion USD annually.

However, Vietnamese businesses are expected to face fierce competition, forcing them to improve their operations.

At the same time, the Vietnamese Government plans to fast-track institutional reform and complete the legal framework to catch up with the development pace and requirements of both domestic and global economies, the ministry said.

VNA

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