The removal of import tariffs within the framework of the free trade
agreement (FTA) with the EU will create better opportunities for Vietnam than
for its rivals in the European Union market, according to chief of the
consultants group of the EU Multilateral Trade Assistance Project Claudio
Dordi.
He said that the country’s
exports will increase and it will enjoy lower taxes on technology and
high-quality materials from the EU. In the meantime, the EU will export quality
services, improving Vietnamese businesses’ long-term competitiveness, he added.
At present, Vietnam exports five
staples: footwear, garments and textiles, coffee, seafood and wooden furniture
to the EU. The current tariffs applied on Vietnam’s goods stand at around 4.1
per cent, but garments have an 11.7 per cent tariff, seafood, 10.8 per cent, and
footwear, 12.4 per cent.
With 27 members and around 500
million people, the EU is the largest importer of garments and textiles in the
world, making up half of the world’s import value. The bloc’s 2013 import value
of garments and textiles is expected to hit $234.2 billion, and Vietnam’s
exports of the items, $2.37 billion.
Under the FTA, tariffs on
garments and textiles will be slashed from 11.7 per cent to zero per cent,
therefore facilitating the sector’s growth.
However, garment and textile
businesses said the Government should pay attention to the principles of origin
and the time period for two-way tariff cut during the negotiation.
Regarding the fisheries sector,
Secretary General of the Vietnam Association of Seafood Exporter and Producers
(VASEP) Truong Dinh Hoe said that the FTA should help the sector abide by
sanitary and phytosanitary (SPS) measures and market access.
The EU is an important market for
Vietnam, he said, adding that the eradication of tariffs on the majority of
export items will create favourable conditions for Vietnam to compete against
its rivals.
According to Director of the Ho
Chi Minh City Chapter of the Vietnam Chamber of Commerce and Industry Vo Tan
Thanh, the agreement will help improve the business environment and facilitate
direct investment and business activities from the EU and other nations in
Vietnam.
Head of the Ministry of Trade’s
Asia-Pacific Market Department Bui Huy Son, who is also Director of the
EU-MUTRAP project, said the EU is Vietnam’s leading partner in economics, trade
and investment.
The FTA is proceeding to the
third round of negotiation and the process is expected to finish in 2014.
He emphasised the necessity for
businesses and sectors to contribute their opinions to the FTA negotiations as
it is not only in their interest, but also necessary to the negotiations.
The General Statistics Office
said the EU became Vietnam’s largest importer in 2012 with revenues of $20.3
billion, representing 17.7 per cent of the nation’s total export turnover.
The EU purchases 7.7 per cent of
Vietnam-made products. Vietnam’s trade surplus with the EU was $11.5 billion
and $14.9 billion with the US.
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