EVFTA and EVIPA bring great and balanced benefits to both Vietnam and EU

	EVFTA and EVIPA bring great and balanced benefits to both Vietnam and EU
	EVFTA improves Vietnam’s business governance, farm produce exports

Mr. Vu Anh Quang, Ambassador Extraordinary and Plenipotentiary of Vietnam to the Kingdom of Belgium, Grand Duchy of Luxembourg, Head of the Delegation of Vietnam to the European Union (EU).

Mr. Ambassador, how do you assess the relationship between Vietnam and the EU today, especially on trade and investment? Are those results commensurate with the potential of Vietnam and the EU?

Vietnam is one of the Asia-Pacific countries with extensive cooperation with the EU.It is the second ASEAN country with a Comprehensive Partnership-Cooperation Agreement (PCA) with the EU; is the first ASEAN country to sign a Defense-Security Cooperation Agreement with the EU, a Partnership Agreement on Forest Law Enforcement, Governance, and Trade. In particular, Vietnam is the second ASEAN country to sign the new generation EVFTA and EVIPA on June 30, 2019.

Economy, trade and investment are always the focus of Vietnam - EU relations. Vietnam is the second largest trading partner of the EU in ASEAN and the EU is Vietnam's second largest export market. Two-way trade has increased every year – in 2018 it reached over 54 billion euros (over US$60 billion). The EU is currently the fifth largest foreign investor in Vietnam, with a total value of US$44 billion. EU investors have a technological advantage, which has contributed to the creation of a number of new high-tech industries in Vietnam.

However, the above-mentioned results of trade and investment cooperation are not commensurate with the great potential of both EU and Vietnam and there is plenty of room for both sides to strengthen cooperation and connectivity. The economic and commodity structure of Vietnam and the EU is not competitive but complementary. The potential of the EU market is very large with 512 million people, per capita income of US$36,580/year, total GDP of US$18,800 billion, accounting for 22 percent of the world economy and bigger than the market of 11 countries participating in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). EU businesses still have plenty of opportunities to exploit the potential of Vietnam's market with over 96.2 million people, economic and living standards of the people growing rapidly, the socio-political situation is stable. The position of EU is the fifth foreign investor in Vietnam is still too modest.

Both Vietnam and the EU are looking forward to the EVFTA and EVIPA. According to information from the National Assembly's Foreign Affairs Committee, these two new generation agreements may be approved by the European Parliament in the first half of 2020. What isthe Ambassador's evaluation of the feasibility of the EVFTA and EVIPA being approved in the first half of next year?

The EVFTA and EVIPA are very important for both Vietnam and the EU, not only for trade and investment. Therefore, both sides want these two agreements to come into effect soon.

Following the process in the European Parliament (EP), the EP's International Trade Commission is processing the EVFTA - EVIPA dossier, andis expected to vote on the two agreements on January 21, 2020 and submit them to the EP. The EP is expected to review and vote to ratify theagreements in February 2020. I hope the EP will complete the procedure for ratifying the agreements in the first quarter of 2020. I understand that the National Assembly of Vietnam is also planning to ratify the EVFTA and EVIPA at the May 2020 meeting.

According to the Ambassador, after taking effect, what opportunities will the EVFTA and EVIPA bring to Vietnam, especially in terms of promoting goods export and attracting investment?

The EVFTA and EVIPA will bring great and balanced benefits for both Vietnam and the EU abouteconomy,politics, society, environment, businesses, workers and consumers. Of course, the benefits of trade and investment are huge, as Vietnamese and EU economic products are complementary. The removal of 99 percent of tariff barriers will create new opportunities and advantages for Vietnamese goods to increase access to the EU market, which is now our second largest export market.

The EVIPA will reassureEU businesses to increase investment in Vietnam, especially strong EU industries such as high technology, clean energy, automation, finance-banking, transportation-ports, infrastructure and logistics. The two agreements will help Vietnam promote economic restructuring, change the growth model, increase competitiveness and create conditions for Vietnamese enterprises to participate more deeply in global value chains.

The EU is a "strict" market and the EVFTA and EVIPA are new generation FTAs with many strict terms that Vietnam must abide by. Could you evaluate the preparation of Vietnam and what are the recommendations for policy makers and the Vietnamese business community to make best use of the opportunities provided by these agreements?

The World Trade Organization and the EU assess these as "new generation, comprehensive" agreements, linked to "social, labor and environmental standards". EVFTA has a high level of commitment compared to the FTAs that we have signed, such as rules of origin of goods and customs, food safety, intellectual property, legal-institutional issues and sustainability.

Ministries, branches and business associations have researched and organized many workshops to inform and exchange about the opportunities and challenges of the EVFTA and EVIPA. Following the EU commitment, the National Assembly passed the revised Labor Code in November 2019, acceded to the International Labor Organization Convention (ILO) Convention in June 2019, offering a roadmap for accession twobasic conventions on remaining labor.

The EVFTA and EVIPA are two new generation comprehensive agreements.In order to make good use of opportunities, policy makers should proactively integrate their implementation into Vietnam's Socio-Economic Development Strategy in the 2021-2030 period, the socio-economic development program in the 2021-2025 period, associated with the policy of restructuring the economy towards inclusive development, bringing benefits to businesses and workers (such as creating more jobs, increase income and improve working conditions) so that people must be the main beneficiaries of the EVFTA and EVIPA.

In addition to policy making, creating a favorable business environment for the State, the role of business associations is very important, such as supporting access to information on markets, industries, investment and connection support, helping Vietnamese businesses reduce costs, especially small and medium enterprises. Not only Vietnamese businesses, besides taking the initiative to seize opportunities, should be aware that export goods to the EU market must meet quality standards, but also businesses need to fulfill their social responsibilities, ensure labor standards and environmental protection as the EVFTA has prescribed.