EVFTA a golden opportunity for Vietnam to recover after pandemic

16:45 02/11/2021

The EU-Vietnam Free Trade Agreement (EVFTA) will open up many opportunities for Vietnamese businesses to attract investment capital and expand export markets in the post-COVID-19 period.

EVFTA a golden opportunity for Vietnam to recover after pandemic -0
EVFTA a golden opportunity for Vietnam to recover after pandemic.

Vietnam has become the largest commodity trade partner of the European Union (EU) in ASEAN just one year after the EU-Vietnam Free Trade Agreement (EVFTA) took effect, according to a remark of Deputy Minister of Industry and Trade Dang Hoang An during the Vietnam-EU Trade Forum titled "EVFTA – Leverage for Trade and Investment Cooperation in the New Normal’ jointly held by the Ministry of Industry and Trade (MoIT) and the European Chamber of Commerce (EuroCham) in Hanoi.

In the context of economic recovery in the post-COVID-19 period, along with the shaping and development of new trade and investment trends, the EVFTA would facilitate and increase competitiveness for domestic enterprises so that Viet Nam can participate in the process of restructuring supply chains with European Union (EU) partners.

The participation in the chains would open up opportunities to attract investment capital and advanced technology, and create new resilience and sustainable growth in the future, he added.

The two sides could be optimistic about a strong surge in the Vietnam-EU trade and investment cooperation development in the new normal.

EuroCham Chairman Alain Cany stressed that the two sides need to closely cooperate with each other in resolving current issues, saying that with various advantages, Vietnam has chances in attracting new foreign investment inflows from European investors who are seeking a stable, safe, prosperous and competitive destination.

Ambassador Giorgio Aliberti, Head of the EU Delegation to Vietnam, said the EVFTA is projected to bolster the export of Vietnamese fruits and farm produce to the EU. However, firms have been facing obstacles in entering the EU market due to complicated procedures.

Business leaders needed centralised rules implemented in a clear and consistent manner across all provinces and cities. This would enable companies to plan their re-opening in advance and resume at their full capacities wherever it is safe to do so, he said.

"In short, the challenge now is to ensure that private enterprise is able to rebound and recover as fast as possible. In doing so, we can help to achieve the second of the Government’s twin goals: maintaining economic growth. The EVFTA gives us a tool with which to achieve this."

“If we can unlock the full potential of the EVFTA and resolve the teething problems of doing business in the ‘new normal’, we can help our companies to benefit from preferential tariffs and privileged market access. This, in the end, will benefit consumers on both sides who will get greater access to more competitive goods and services.”

Vietnam is in a stronger position than most to prosper in this post-pandemic period. The fundamentals that have underpinned its three decades of almost uninterrupted economic growth remain strong, according to Cany.

“And now that COVID-19 has been brought back under control, with the EVFTA in force, and the EVIPA soon to follow, Viet Nam has the chance to attract a new wave of foreign direct investment (FDI) from European investors looking for a prosperous, safe, and competitive place in which to invest and do business,” he said.

With a strong commitment to ensuring transparency, openness and favourable conditions in the trade and investment environment, Viet Nam has gained access to high-quality investment sources from the EU with projects using advanced technologies,.

In the context of the COVID-19 pandemic, Vietnam attracted US$22 billion from the EU in the first nine months of the year, up 4 per cent year on year, accounting for 5.5 per cent of Viet Nam's total FDI, according to an official from the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment.

To effectively take advantage of the EVFTA and new investment and business opportunities after the pandemic, An said that it needed great efforts from both the Government and the business community, especially as the pandemic was still complicated and unpredictable.

According to the General Department of Vietnam Customs, bilateral trade between Viet Nam and the EU after this agreement came into effect in August 2020 reached US$54.87 billion, up 12.1 per cent year on year, including the export turnover of $38.48 billion, up 11.3 per cent and import turnover at $16.39 billion, up 14 per cent.