On behalf of Vietnam's President Nguyen Phu Trong, Vice President Dang Thi Ngoc Thinh said the EU – Vietnam Free Trade Agreement (EVFTA) brings mutual benefits for all parties involved, and suggested that the National Assembly (NA) should approve the deal at the earliest possible.
|Vietnam's Vice President Dang Thi Ngoc Thinh suggests the NA to approve the EVFTA and EVIPA. Source: VGP.|
Once the NA ratifies the trade deal, it would enter into force 30 days after Vietnam and the EU have notified each other that their respective legal procedures have been completed.
Vice President Thinh said the the deal would emphasize Vietnam’s geopolitical significance in the Southeast Asian and Asia – Pacific regions, at the same time heightening the country’s status on the global stage.
Along with the EVFTA, the EU – Vietnam Investment Protection Agreement (EVIPA) is a driving force for Vietnam to finalize its legal framework, with a view to improving the business environment towards greater fairness, transparency and friendliness to investors, Thinh added.
The EVFTA, officially signed last June after six years of negotiations, has been dubbed “the most ambitious” FTA the EU has ever reached with a developing country, according to the European Commission. It not only includes the almost full elimination of bilateral tariffs, but also a substantial reduction of non-tariff barriers. Moreover, it includes provisions to protect intellectual property, labor, environmental standards, and fair competition, while promoting regulatory coherence.
The EU is one of Vietnam’s largest trade partners with turnover of US$56.45 billion in 2019, of which Vietnam exported goods worth US$41.54 billion and imported goods worth US$14.9 billion.
On March 30, the European Council (EC) adopted a decision on the conclusion of the EVFTA following the ratification by the European Parliament on February 12. This decision cleared the path, on the EU side, for the entry into force of the agreement, said the EC.
A study from Vietnam’s Ministry of Planning and Investment suggested the EVFTA and EVIPA would help Vietnam’s GDP grow an additional 4.6% and boost the country’s exports to the EU by 42.7% by 2025.
Meanwhile, the European Commission estimated the bloc’s GDP would be added US$29.5 billion by 2035, along with additional growth of 29% in exports to Vietnam.
Regarding Brexit, the government proposed applying the EVFTA with the UK until the end of the transitional period on December 31, 2020, subject to an extension of another 24 months.
Meanwhile, the NA’s Committee for External Relations requested the government to initiate a free trade deal with the UK based on the EVFTA in replacement of the latter eventually, however, there would be adjustment to ensure benefits of the two countries.