Vietnam Free Trade Agreement
Vietnam has overtaken its regional rivals Indonesia and Thailand, and is the EU`s second largest trading partner in ASEAN. Today, EU companies have the opportunity to apply for contracts with Vietnamese ministries and state-owned enterprises throughout the country. Vietnam will allow European investors to award public contracts to ministries such as the Ministry of Defence, Vietnam Railways Corporation and dozens of public hospitals, under the control of the Ministry of Health. The European Commission estimates that the agreements would help increase exports to Vietnam by 29% in 2035 and increase GDP to $29.5 billion. It took more than eight years and a dozen rounds of dialogue for both sides to negotiate the EVFTA. Nicolas Audier, President of EuroCham in Vietnam, welcomed the results of the vote: „The EVFTA is now more important than ever, as trade wars and a global pandemic disrupt normal affairs on an unprecedented scale. Free, fair and rules-based trade is the best roadmap for economic growth, and Vietnam will now have privileged access to an EU consumer market of around 500 million people who want to do business and invest with a strong, secure and prosperous nation in the heart of Asia. At this stage, free trade between the EU and Vietnam is a sign of improved international economic relations. This cooperation aims to protect the rights of the different actors in both environments by recognising reciprocal norms. It also provides more comfort and less danger for local workers in their daily lives, so they can do their jobs properly and fairly. Second, a large part of the direct export interest in Vietnam.
The data below show that more than 70% of Vietnam`s exports are related to FDI. EU investors will therefore also benefit from the increase in export capacity resulting from lower import duties in the EU. More importantly, the agreements call on Vietnam to adopt international standards that further increase the prospects for related exports, which are subject to rigorous monitoring of standards in jurisdictions such as the EU. Such agreements illustrate the strength of EU-Vietnam relations and the opportunities Europe sees in the Southeast Asian country. The EU is achieving a long-term goal of increasing its influence and expansion in ASEAN markets by targeting Vietnam, and European entrepreneurs will have better access to one of the fastest growing Asian economies when the agreements come into force. Despite the interruption of the coronavirus pandemic and the slowdown in the global economy, Vietnam is expected to continue to record economic growth of 4.8% this year, returning to 6.8% in 2021. In addition to the elimination of tariffs and non-tariff barriers for goods and services, it contains important provisions on intellectual property protection, investment liberalization, public procurement, competition and sustainable development. The agreement will add new GIs in the future. The Free Trade Agreement between the European Union and Vietnam (EVFTA) is the second free trade agreement between the EU and an ASEAN country after Singapore. Vietnam is the second country to have signed trade and investment agreements in the region. Given the recent slowdown in trade growth in the major economies, Vietnam remains an outlier. The country`s import and export sales exceeded $500 billion in 2019.
The country`s advantages, which resulted from the escalation of trade tensions between the United States and China in June 2019, eventually do so. At that time, the country`s GDP increased by 6.71% (fourth from the previous quarter, Q2 2019), which was a sign of manufacturing export growth of 9.14%.