A free-trade agreement with the European Union has been unanimously approved by the Vietnam Parliament recently, and this agreement will shed almost all tariff on traded goods between the two sides. The National assembly vote had followed earlier approval by the European Union in February and will go into effect in July, as reported by Vietnam Chamber of Commerce and Industry.
The agreement consist of the European Union will slash 99% of the import duties over seven years, and Vietnam over 10 years, opens up public procurement and curbs non-tariff barrier. As trade between the two sides reached US$56.45 billion last year, including US$41.5 billion of Vietnam exports, according to the Vietnam Customs.
The trade with the EU last year was 16% the nation’s total shipments, and since Vietnam has economy relied upon exports, around the last two decades has made more than a dozen similar free-trade agreements. The latest agreements are expected to increase the country’s GDP by 2.4% and pushing an extra 12% of exports by 2030, as World Bank reports forecasted in May. Another expectation was to lure more foreign companies shift their operations to Vietnam, as cited by the Chamber of Commerce and Vietnam’s Minister of Industry. The investment protection pact with the EU was also passed by Vietnam’s legislature.
