On June 25, the Council of Ministers authorized the EU-Vietnam trade and investment agreements which are set to be signed by Swedish born EU Commissioner for Trade Cecilia Malmström and Romanian Minister for Business, Trade and Entrepreneurship Ștefan-Radu Oprea on the EU’s behalf in Hanoi on Sunday 30 June.
The agreements with Vietnam, the EU’s second largest trading partner in the ASEAN region under Singapore, tagged along behind those signed recently with Singapore.
The agreements are expected to bring benefits for European and Vietnamese companies, consumers and workers, while pave the way for a future region-to-region agreement with the entire Association of Southeast Asian Nations (ASEAN). The agreements are also set to promote respect for labor rights, environmental protection and the fight against climate change under the Paris Agreement.
Major economic advantages brought by the trade agreement are as follows:
1. Eliminating almost all customs duties on goods traded between the two sides in a progressive way that fully respects Vietnam’s development needs
2. Removing technical obstacles, such as those in the car sector
3. Ensuring that 169 traditional European food and drink products recognized as Geographical Indications are protected in Vietnam
4. Enabling EU companies to participate in bids for procurement tenders in Vietnam on an equal footing with domestic companies
Under the agreement, both sides are required to implement the principles of the International Labour Organisation (ILO) concerning fundamental workers’ rights in Vietnam where the ILO Convention on collective bargaining was recently ratified. Vietnam also notified the EU of its intention to ratify the two outstanding fundamental ILO conventions by 2023 at the latest.
President of the European Commission Jean-Claude Juncker said:
“I welcome the decision taken today by EU Member States. After Singapore, the agreements with Vietnam are the second to have been concluded between the EU and a Southeast Asian country, and represent stepping stones to a greater engagement between Europe and the region.
“It is also a political statement by two partners and friends standing together for open, fair and rules-based trade.”
Commissioner for Trade Cecilia Malmström said:
“I am very pleased to see that Member States have given a green light to our trade and investment agreements with Vietnam. Vietnam is a vibrant and promising market of more than 95 million consumers and both sides have much to gain from stronger trade relations. Beyond the clear economic benefits, this deal also aims to strengthen respect for human rights as well as protecting the environment and workers’ rights.
“I welcome Vietnam’s engagement in the process so far – their recent ratification of the International Labour Organisation Convention on collective bargaining is an excellent example of how trade agreements can encourage higher standards.”
Source: European Commission’s Press release