Research on EVFTA’s one-year implementation released

Thursday, 2021-11-04 11:38:12
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NDO/VNA – A research on one-year implementation of the Europe-Vietnam Free Trade Agreement (EVFTA) was launched at a workshop in Hanoi on November 3.

The research, entitled “One Year Implementation of EVFTA: Impacts on the Vietnamese Economy and Policy Formation", was implemented by the Vietnam Institute for Economic and Policy Research (VEPR) with support of Konrad Adenauer Foundation (KAS) Vietnam.

Signed after 10 years of negotiation, the EVFTA has become effective since August 2020 in a special context when the world was struggling against COVID-19 pandemic.

With strong commitments on the opening of market, the deal is expected to become a motivation for the economic growth of Vietnam, helping diversify market and promote trade, especially on strong products of Vietnam such as agro-fisheries products.

However, along with bright spots during one year of the implementation of the agreement, in general, Vietnamese firms have still faced many difficulties in making full use of the deal.

Addressing the event, Associate Prof. Dr. Nguyen Anh Thu, VEPR Director, said that one year after the EVFTA took effect, Vietnam’s trade revenue from the EU market reached US$39.8 billion as recorded by July 31, 2021, up 6.2 percent year on year.

Thu noted that the legal system of Vietnam is being changed positively to meet requirements of the deal.

However, Thu held that Vietnam is facing many challenges from both inside and outside. She advised businesses to be more active to improve their capacity and products’ quality to deeper engage in the global supply chain.

Meanwhile, Pham Van Long, a representative from the research team said that among eight businesses involving in the research, only two said that they saw rise in export revenue from the EU thanks to a rise in order, and the remaining said that they suffered reduction.

He said that the reasons behind the situation was tighter export conditions and higher logistics cost due to impacts of COVID-19.

In general, the EVFTA is one of the new generation FTAs that brings about strategic benefit to Vietnam through the development of the promising trade and investment partnership with one of the biggest and most important partner of Vietnam.

Due to COVID-19 impacts, the effectiveness of the deal as remarkably restricted. One year since the deal become effective on August 1, 2020, export value of goods might reach US$51.04 billion, up 12.27 percent in case of no COVID-19 and no tariff reduction, and 36.28 percent compared to the same period in the previous year.

Participants at the event proposed a number of recommendations on the reform of administrative procedure to make more favourable conditions for businesses in taking advantages from the EVFTA.