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Vietnam, EU trade deal to spur growth

Publication Date : 30-11-2012

 

A free trade agreement with the EU would bring Vietnam tangible benefits in terms of removed tariff barriers and increased legal certainty as well as wider intangible benefits that could help strengthen Vietnamese production chains, said the head of the Trade and Economic Section of the EU Delegation to Vietnam, Jean Jacques Bouflet, at a workshop in Hanoi yesterday.

Entitled "Challenges in 2013: The Road Ahead to an EU-Vietnam Free Trade Agreement", the workshop was hosted by the Vietnam-EU Business Forum.

Vietnam has became the third Asian country to kick off free trade negotiations with the EU following Singapore and Malaysia, the director of the Ministry of Industry and Trade's Multilateral Trade Policies Department, Luong Hoang Thai, told the gathering.

Negotiations for a free trade agreement with the EU have begun in the context of a global economic crisis, so it would be more difficult to reach strong commitments than when the economies were seeing good growth, Thai said. However, negotiations were proceeding with a long view towards long-term growth, he said, noting that recession was simply part of the economic cycle.

The negotiations also included new aspects not previously discussed in trade negotiations, including public purchasing, Thai said.

There was great potential for enhanced trade and economic relationship, said Bouflet, pointing out that the EU common market of 500 million consumers still had abundant market opportunities for Vietnamese products. In return, the EU would offer top-quality investment, advanced environmentally-friendly technology, management expertise and more.

However, to achieve an agreement within two years, strong political commitments, goodwill and a frank and practical approach were needed, he stressed.

"It's important that Vietnam enhance economic restructuring and boost enterprise competitiveness to overcome challenges that a free trade agreement would bring," said economic expert Pham Chi Lan.

The former vice chairman of the Vietnam Business Association in the Czech Republic and Slovakia, Pham Xuan Ha, stressed that the legal system needed to be reformed to create a more favourable business environment.

The EU was the second biggest market for Vietnamese products in 2011 and in the first nine months of this year and was a key foreign investment partner and source of official development assistance for Vietnam, Bouflet said.

The EU imported goods from Vietnam worth over US$16.5 billion in 2011, equal to 17.6 per cent of Vietnam's total exports. The figure for the first nine months of this year was $14.4 billion, compared to $14.7 for the US.

 

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