PHNOM PENH — The EU and ASEAN business communities and policy makers yesterday gathered for the second ASEAN – EU Business Summit in Phnom Penh to discuss ways of further enhancing the ASEAN business environment.
ASEAN Secretary-General Surin Pitsuwan told those assembled that the effects of globalisation made it difficult to avoid spill-over from one region to the rest of the world, adding that "that's why we have to open up to each other".
"The time is now for business communities in ASEAN and the EU to come together to mitigate the effects of these new economic dynamics through trade, investment and technology so that more opportunities will be created to advance our partnership and to eliminate or reduce the uncertainties within the two regions," he said.
EU Trade Commissioner Karel De Gucht said trade and investment between the European Union and ASEAN was vital for the future prosperity of both regions.
"In Europe, we know that 90 per cent of world's economic growth will take place outside our borders. ASEAN – as a motor for Asia's economic development – is set to have a major slice of that growth," he said.
More than 300 participants attended the summit, including many leaders in business from across Europe and the ASEAN region.
Viet Nam eyes EU trade deal
The European Union and Viet Nam are poised to launch negotiations on a bilateral free trade agreement (FTA) after agreeing upon a list of topics to be covered on Saturday.
The negotiations will cover a broad range of issues including the elimination of import tariffs, non-tariff barriers to trade, trade in services, and the trade aspects of rules relating to intellectual property and competition.
EU Trade Commissioner Karel De Gucht said the completion of the framework marked a clear desire to deepen trade relations and improve the business environment between the EU and Viet Nam.
"Last year, EU-Viet Nam trade in goods was worth over 18 billion euros (US$24.19 billion) and I believe an eventual free trade deal would provide real opportunities for European businesses to expand in a country that is economically growing stronger and stronger," he said.
Minister of Industry and Trade Vu Huy Hoang, who met with EU Trade Commissioner Karel De Gucht on the sidelines of the 11th ASEAN-EU Economic Meeting in Phnom Penh, said Viet Nam was committed to moving forward and would prioritise the FTA with the EU and the pending Trans-pacific Partnership negotiations.
The next step would be for the Commission to receive support from the EU member states, a process that could take a couple of months, said Jean-Jacques Bouflet, head of the Trade and Economic Section of the European Union delegation to Viet Nam.
"We hope that we can open the negotiations around the summer recess, and they may take up to three years," he said.
Presently, Viet Nam is able to export to the European market largely due to generalised systems of preferences whereby the EU provides lowered rates to Vietnamese products.
"This is the unilateral scheme which can't be guaranteed in the long-term because Viet Nam is increasing its standards of living. So Viet Nam has to prepare itself for the day when it will be rich and developed enough to no longer benefit from this scheme," he said.
"The free trade agreement is important in the sense that it will secure access to European markets in the long run. Beyond the tariff treatment, an FTA is the best tool to attract foreign direct investment," he told Viet Nam News.
Deputy Director of the Central Institute for Economic Management Vo Tri Thanh said the negotiations would be very tough because the FTA with EU would go beyond the conventional commerce agreement to touch on other issues, which have so far not been required under the World Trade Organisation agreement.
"For example, the negotiations will also cover labour, environment and competition. It will be a challenge for a transitional economy like ours, since we do not have much experience or really the capacity to deal with it," he said.
Viet Nam would be the EU's third partner in ASEAN, after Singapore and Malaysia, with whom it has already started negotiations on a free trade agreement.
Currently, Viet Nam has a trade surplus with the EU in Viet Nam's advantage of 7.6 billion euros. — VNS