The Benefit Of EVFTA On Vietnam

After many years of heightened negotiations, the comprehensive and contemporary EU-Vietnam Free Trade Agreement, otherwise known as EVFTA, finally came into action. The agreement is dubbed both comprehensive and contemporary as it promises to gradually eliminate almost all tariffs between both regions over the next decade, as well as focus on binding rules on labor, climate change, and human rights.  

99% elimination of tariffs:
The agreement is a win-win deal with equitable benefits for both Vietnam and the EU. One of these notable benefits is as stated an up to 99% elimination of tariffs. These cuts will help Vietnam boost its exports in many areas, these could include agriculture, fishery, and even forestry, into the European market and thus help Vietnam step into a larger playground. Vietnamese rice and seafood exports will also see a reduction of tariffs in which these fields will, without doubt, reap the benefits of the plan. 

Elimination of customs duties:

Both businesses and consumers will be aided in an advantageous deal through the elimination of customs duties over a 7 year transitional period for Vietnamese stock and 10 years for the EU. This condition in the FTA will help increase greater competitiveness, lower cost, and strengthen both economies, as well as lead to an evident increase in Vietnamese exports to the EU.

Increase the import-export between Vietnam and EU:

Vietnam has also gone further than the World Trade Organisation (WTO) in the agreement with reference to the amount of market access being granted to EU service providers. Increased sub-sectors will be opened up, giving the EU the most attainable access to Vietnam’s market, and further help Vietnam to continue its current evolution and reform.

The benefits of the EVFTA will enable Vietnam to move into exporting more complex, high-tech goods such as machinery, medical devices, and vehicles. This deal will intensify relations between both parties and at a time where the Vietnamese economy is developing significantly, help contribute to Vietnam becoming the manufacturing hub of Asia.

>> Read more of our insight of Vietnam at: Vietnam Profile

>> Know further details about Vietnam-EU Free Trade Agreement (EVFTA) at  Center for WTO and FTA