EVFTA paves way for high-quality FDI flows from Europe to Vietnam

The European Union (EU)-Vietnam Free Trade Agreement (EVFTA) is expected to trigger high-quality FDI flows from Europe to the Southeast Asian country, said Vietnamese Trade Counsellor in Italy Nguyen Duc Thanh.

EVFTA paves way for high-quality FDI flows from Europe to Vietnam hinh anh 1

Slated to come into effect on August 1, 2020, the agreement will also help Vietnam improve its position in global supply chains and create more added value, he said.

Under the deal, he expects Vietnam’s GDP to increase 2-3 percent in the first five years of implementation, 4.5-5.3 percent in the subsequent five years, and 7.0-7.7 percent in the five years to follow.

The Ministry of Planning and Investment estimated prior to the COVID-19 outbreak that, thanks to the EVFTA, Vietnam’s export revenue to the EU would expand about 20 percent this year, 42.7 percent in 2025, and 44.37 percent in 2030, primarily vehicles and transportation equipment, machinery, spare parts, phones and electronic components, pharmaceuticals, garments and textiles, and leather and footwear.

However, he added, figures from the General Department of Vietnam Customs show that exports to the EU from January to May were down 9.68 percent year-on-year.

Export value may therefore rise just 5 percent this year but higher levels will be posted from 2021 onwards.

The EU has committed to providing Vietnam with the highest-ever tax incentives, Thanh said, with up to 85 percent of tariff lines on Vietnamese goods cut to zero percent as soon as the agreement takes effect, with tariffs on most of the remaining goods eliminated after seven years.

New added value will be created for any party aware of new global trends post-COVID-19, puts forth business strategies, and develops its economy sustainably, the Trade Counsellor emphasised.

 

He also pointed to the challenges ahead, such as strict regulations, standards, and technical barriers set by the EU, and suggested Vietnamese companies satisfy the demand of European consumers in taste, packaging, and food safety while scaling up production, stepping up cooperation, and ensuring transparency.

He said Vietnam needs to act fast to optimise the opportunities generated by the agreement, as the EU is yet to conclude negotiations over FTAs with Thailand and Indonesia.

Thanh also warned of changes in the post-COVID-19 period when major Western European countries restore domestic supply chains to ease reliance on goods from Asia.

Given this, Vietnam needs to find its own path, he said, suggesting it cut the processing of low value added goods.

According to the Trade Counsellor, Vietnam can optimise the agreement to promote the export of certain products to Italy, such as electronic motors, phones and spare parts, honey, footwear, garments and textiles, face masks, pharmaceuticals, machinery, equipment, wooden items, and agro-fishery products, especially rice.

He affirmed that the commercial affairs office of the Vietnamese Embassy in Italy stands ready to act as a bridge for trade between the two countries./.VNA

Even with EVFTA, Vietnamese fruit still relies on Chinese market

Even with EVFTA, Vietnamese fruit still relies on Chinese market

Vietnamese fruit exporters have been trying to stop their reliance on China, but no progress has been made in finding new markets.

Vietnamese goods entering EU not straightforward under EVFTA

Vietnamese goods entering EU not straightforward under EVFTA

Quality standards, rules of origin, and legal aspects are said to be among the barriers Vietnamese businesses will have to overcome to gain a foothold in the European market under the EU-Vietnam Free Trade Agreement (EVFTA).

 
 

Other News

.
US firms create record 4.8 million jobs in June
US firms create record 4.8 million jobs in June
BUSINESSicon  03/07/2020 

The reopening of businesses has spurred job growth but a rise in Covid-19 cases may hamper recovery.

Chubb Life Vietnam honored “Best Companies to Work for in Asia 2020”
Chubb Life Vietnam honored “Best Companies to Work for in Asia 2020”
BUSINESSicon  03/07/2020 

Chubb Life Vietnam has been recognized as one of the “Best Companies to Work for in Asia 2020” by HR Asia, the continent’s leading publication for Human Resources professionals.

VN government to sell stake in country’s biggest brewery
VN government to sell stake in country’s biggest brewery
BUSINESSicon  03/07/2020 

The Government will sell its 36% stake, equivalent to 230.8 million shares worth some VND37.6 trillion (US$1.6 billion), in the Saigon Beer-Alcohol-Beverage Corporation (Sabeco), the country’s biggest brewery, this year.

Fabric production an issue for Vietnam's textile industry
Fabric production an issue for Vietnam's textile industry
BUSINESSicon  03/07/2020 

Fabric production is a challenge for Vietnam's textile and garment industry when it comes to free trade agreements (FTAs) requirements on product origin.

Vietnam's FDI inflows to increase
Vietnam's FDI inflows to increase
BUSINESSicon  03/07/2020 

A new wave of foreign direct investment driven by global uncertainty such as the US-China trade war and the COVID-19 pandemic is imminent in Vietnam, 

Predatory debt collectors hustling on borrowed time
Predatory debt collectors hustling on borrowed time
BUSINESSicon  02/07/2020 

Debt-collecting businesses are to be banned in Vietnam as part of local government action to protect customers’ rights, with the upsurge of predatory lending services triggering heated debate and eroding public trust.

Proposal steers sports betting to starting line
Proposal steers sports betting to starting line
BUSINESSicon  03/07/2020 

A proposed national steering committee is expected to help Vietnam build clearer prize-winning entertainment rules and set up closer connections between government authorities and investors 

EVFTA will broaden skies for aviation across Vietnam
EVFTA will broaden skies for aviation across Vietnam
BUSINESSicon  03/07/2020 

Never-before-seen activities in Vietnam’s aviation sphere are expected to come to EU businesses soon on the back of the landmark EU-Vietnam Free Trade Agreement.

RCEP benefits on horizon for ASEAN
RCEP benefits on horizon for ASEAN
FEATUREicon  02/07/2020 

With the Regional Comprehensive Economic Partnership scheduled to be signed this November, doors will soon open to attract more investment and swell Vietnam’s trade with international partners.

An abundance of advantages to diversify ops into Vietnam
An abundance of advantages to diversify ops into Vietnam
BUSINESSicon  02/07/2020 

Amidst the new wave of foreign investment and relocation after the pandemic, director general of the Foreign Investment Agency Do Nhat Hoang explained Vietnam’s outstanding advantages and how it can seize arising opportunities.

Vietnam closes in on tech app tax avoiders
Vietnam closes in on tech app tax avoiders
BUSINESSicon  02/07/2020 

Apple and Google are once again under fire over tax avoidance in Vietnam, with none of their revenues from their app markets being retained in the country. However, a new law could soon enable local authorities to take their cut.

Drugmakers fight to attain approval
Drugmakers fight to attain approval
BUSINESSicon  02/07/2020 

Switzerland’s drug maker Novartis Pharma Services AG has announced a GMP qualification for Lek Pharmaceuticals d.d. within the scope of certification for medicines in Vietnam,

PouYuen lays off thousands  due to Covid-19 difficulties
PouYuen lays off thousands due to Covid-19 difficulties
BUSINESSicon  02/07/2020 

More than 6,000 workers of the Taiwanese company, PouYuen, in HCM City have been laid off due to the company's business difficulties during the Covid-19 pandemic.

Fitch Solutions revises up Viet Nam’s 2020 GDP growth
Fitch Solutions revises up Viet Nam’s 2020 GDP growth
BUSINESSicon  02/07/2020 

Fitch Solutions have revised up its 2020 real GDP growth forecast for Viet Nam slightly to 3.0 per cent, from 2.8 per cent previously.

Domestic demand the driving force for agriculture to develop
Domestic demand the driving force for agriculture to develop
BUSINESSicon  03/07/2020 

Nguyen Quoc Toan, director-general of the General Department for Agricultural Products Processing and Market Development, under the Ministry of Agriculture and Rural Development, 

Zalo Bank not licensed by SBV and MoIT
Zalo Bank not licensed by SBV and MoIT
BUSINESSicon  02/07/2020 

The State Bank of Vietnam (SBV) and the Ministry of Industry and Trade have affirmed that they have not licensed Zalo Bank to provide online built-in financial services.

EVFTA to come into effect in a month
EVFTA to come into effect in a month
BUSINESSicon  02/07/2020 

The EVFTA will abolish 65 per cent of the duties on EU exports to its developing partner, with the remainder phased out over a 10-year period.

Footwear sector to improve supply chain to take advantage of EVFTA
Footwear sector to improve supply chain to take advantage of EVFTA
BUSINESSicon  02/07/2020 

Vietnam’s leather and footwear industry should improve its supply chain performance to take advantage of the milestone trade deal that Vietnam has signed with the EU and to recover from the effects of the COVID-19 crisis, 

World Bank Vietnam has new head
World Bank Vietnam has new head
BUSINESSicon  02/07/2020 

From July 1, Ms. Carolyn Turk will work at the World Bank (WB) Hanoi office as its country director in Vietnam, according to the office.

China maintains position as Vietnam's largest import market
China maintains position as Vietnam's largest import market
VIDEOicon  02/07/2020 

Despite the first half of the year seeing Vietnamese export turnover to China only reaching a mere US$34.8 billion, China retained its place as the country’s largest import market, according to the General Statistics Office.

 
 
 
Leave your comment on an article

OR QUICK LOGIN