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Eu-Vietnam Free Trade Agreement (Evfta)

The EU-Vietnam Free Trade Agreement (EVFTA) was signed on June 30th, 2019, and came into effect on August 1st, 2020. This landmark agreement between the European Union (EU) and Vietnam is set to create new opportunities for both parties, particularly in the areas of trade and investment. In this article, we will delve deeper into the key features of the EVFTA and what it means for businesses and consumers in the EU and Vietnam.

Benefits for the EU:

The EVFTA is expected to increase the EU`s access to the Vietnamese market, which is a rapidly growing market with a population of nearly 100 million people. The agreement will eliminate tariffs on 71% of all goods traded between the EU and Vietnam, with the remaining tariffs being phased out over a period of 10 years. This will give EU exporters a significant advantage in the Vietnamese market, making their products more affordable and competitive.

Moreover, the EVFTA will also give EU service providers greater access to the Vietnamese market. European service providers will be able to operate in Vietnam, which will help boost the EU`s service exports to Vietnam. The agreement will also encourage greater investment flows between the two parties, which will create new opportunities for businesses in the EU.

Benefits for Vietnam:

The EVFTA is also expected to bring significant benefits to Vietnam. The agreement will give Vietnamese exporters greater access to the EU market, which is the second-largest economy in the world. The agreement will eliminate tariffs on almost all goods traded between the EU and Vietnam, making Vietnamese products more competitive in the EU market.

Furthermore, the EVFTA will also help improve the business environment in Vietnam, as it includes provisions for intellectual property protection, labor rights, and environmental protection. These provisions will help create a level playing field for businesses in Vietnam and make it easier for them to attract foreign investment.

Challenges:

Despite the significant benefits that the EVFTA brings, there are also challenges that need to be addressed. One of the main challenges is the need to improve Vietnam`s infrastructure, such as transportation and logistics, to facilitate trade and investment flows between the EU and Vietnam.

Another challenge is the need to address non-tariff barriers, such as regulations and technical standards, which can be a significant obstacle to trade. The EVFTA includes provisions to address these barriers, but it will take time to implement them fully.

Conclusion:

In conclusion, the EU-Vietnam Free Trade Agreement is a significant milestone for both parties. The agreement will create new opportunities for businesses and consumers in the EU and Vietnam and will help boost trade and investment flows between the two parties. While there are challenges that need to be addressed, the long-term benefits of the agreement are clear, and both parties are committed to implementing it fully.