Prime Minister Nguyễn Xuân Phúc witnesses the signing ceremony for the Europe-Vietnam Free Trade Agreement (EVFTA) and the Europe-Vietnam Investment Protection Agreement (EVIPA) on June 30. - VNA/VNS Photo Thống Nhất

HÀ NỘI – History was made yesterday as Việt Nam and the European Union signed agreements on free trade and investment protection at a ceremony in Ha Noi.

The EU-Vietnam Free Trade Agreement (EVFTA) will ensure the balance of benefits for both Việt Nam and the EU.

Once in effect after the European Parliament approves it, the EVFTA will boost Vietnamese exports, especially agriculture and aquaculture and other products in which Việt Nam has comparative advantages.

The deal is set to cut tariffs on 99 per cent of goods traded between the two sides.

The Europe-Việt Nam Investment Protection Agreement (EVIPA) will ensure the two sides’ businesses and investors are treated fairly.

The EVIPA will also help Việt Nam develop good, transparent investing and legal frameworks in order to draw more foreign capital from the 28 member nations of the EU.

The signing of the two agreements with the EU shows Việt Nam is determined and committed to making deeper integration into the global economy and contributing to its growth, especially in the context of twisted and unpredictable developments in politics and economy.

Việt Nam will have an opportunity to tap the EU markets with total population of 508 million and total gross domestic product (GDP) of around US$18 trillion.

Under the EVFTA, Việt Nam’s exports to the EU market are forecast to rise 4-6 per cent compared to a non-FTA trade relation to reach $19 billion. Its exports are expected to touch $75 billion in 2028.

“The signing of the two agreements has started a new chapter in EU-Việt Nam relations, but there is still work that needs to be done and the best efforts of Việt Nam and the EU are required to resolve them,” said Minister of Industry and Trade Trần Tuấn Anh.

“This (the signing ceremony) is an important event that meets the expectations of Việt Nam and the EU and shows the EU’s high appreciation to Việt Nam,” said Nguyễn Chí Dũng, Minister of Planning and Investment.

The two agreements would drive the two sides’ economic growth and help boost the ASEAN community’s economic relation with the EU and the world, Dũng added.

The two new-generation agreements would assist Việt Nam to accelerate its reform in key issues such as economic growth, administrative framework, labour policy and development sustainability, thus fostering a stable, sustainable and environmentally-friendly market-oriented economy for Việt Nam, he said.

With the agreements taking effect, Việt Nam expected to bring EU investors and businesses and high value-added development projects to the country, create opportunities for Vietnamese companies to approach the EU markets and allow Vietnamese consumers to EU-made purchase products at lower prices, he said.

According to Prime Minister Nguyễn Xuân Phúc, the ratification of the two agreements will upgrade the relationship between Việt Nam and the EU, especially amid rising protectionism and slowing global trade.

“The agreements show the two sides’ long-term visions to set up a win-win relationship as both sides want brighter future of sustainable, peaceful and stable development,” he said.

The Vietnamese Government will soon release a national action plan and ask Government agencies and organisations, businesses and people to commit to the agreements, PM Phúc added.

SMEs, people in focus

The agreements will open up both EU and Vietnamese markets for small- and medium-sized enterprises (SMEs) and people as the two sides are aligning new rules and trade with less red tape and tariffs, according to Cecilia Mamlstrom, European Commissioner for Trade.

SMEs would be guided to take advantage of the new deals as the EU wants a broader partnership with Việt Nam in a variety of fields, she told reporters.

However, because Vietnamese businesses and people were not as well-developed as their European partners, there would be challenges for the Vietnamese to make best use of the agreements, minister Anh said.

The upcoming national action plan would create better conditions for local businesses and people to access EU regulations, which focus on the quality, technical requirements and safety of the products, the minister added.

He also urged local firms to review their operations to meet the EU’s standards as there would be more trade conflicts between them and overseas companies. – VNS