What benefits do Vietnamese businesses derive from the implementation of EVFTA?

DNHN - After three years since the EU-Vietnam Free Trade Agreement (EVFTA) took effect, the economic and trade relations between Vietnam and the EU have seen many significant changes in both quality and quantity thanks to the agreement.

According to data from the Ministry of Industry and Trade, after nearly three years of implementing the EVFTA Agreement (since August 1, 2020), Vietnam has exported more than $120 billion worth of goods to the European Union (EU). From August 1 to December 31, 2022, EU exports will reach $15.62 billion, an increase of 3.8% over the same period in 2019. In 2021, exports to the EU reached $40.12 billion, an increase of 14.2%, and a trade surplus of USD 23.23 billion was recorded. In 2022, exports to the EU will total 46.8 billion US dollars, resulting in a trade surplus of 31.4 billion US dollars.

From the information presented above, it is clear that understanding and implementing EVFTA not only contributes to economic growth but also provides numerous benefits to Vietnamese businesses. Beginning in 2023 and ending on July 31, 2023, exports to the EU totaled USD 25 billion. According to a survey by VCCI, a significantly greater proportion of businesses have a relative or thorough understanding of EVFTA than other FTAs. Increasing numbers of businesses are promoting market research and enhancing product quality to meet EU standards, thereby expanding the market and reinforcing the position of many Vietnamese products in Europe. Some noteworthy examples include:

Vietnamese rice is well-liked and solidifies its position in the European market.

According to experts, rice is not a key export commodity to the EU, but rice exports have steadily increased in recent years. This demonstrates that EVFTA has actively supported the exports of Vietnam. The EU provides Vietnam with an annual quota of 80,000 tonnes of rice, including 30,000 tonnes of milled rice, 20,000 tonnes of unmilled rice, and 30,000 tonnes of fragrant rice, by the EVFTA. Specifically, the EU will completely liberalize broken rice, enabling Vietnam to export an estimated 100,000 tonnes of rice to the EU annually. After three to five years, the EU will eliminate taxation on rice products.

According to the Ministry of Industry and Trade, although the volume of rice exports to the EU is relatively small compared to other regional markets, the added value is extremely high because 27 EU countries are markets for high-quality fragrant rice products from Vietnam. Male. This market is challenging, but consumers are willing to pay a premium for superior products. In addition, businesses maximize the amount of rice exported under the tariff quota to take advantage of the EU's 0% tax rate for Vietnam. Statistics indicate that in 2022, rice exports to the EU market increased dramatically, reaching 94,510 tonnes and surpassing the annual quota of 80,000 tonnes of rice allocated to Vietnam by the EU under the EVFTA Agreement. This result demonstrates that the quality of Vietnam's rice is on the rise and meets the stringent standards of discerning markets. Government commerce.

In the last five years, rice exports have maintained a volume of over six million tonnes per year and a value of over three billion dollars per year, according to statistics. In the first half of 2023, Vietnam's rice export volume reached 4.3 million tonnes and 2.3 billion USD, an increase of 22% in volume and 35% in value over the same period in 2022. Rice exports to certain EU markets, such as Poland (up 117%), Belgium (165%), and Spain (300%), grew at triple-digit rates.

As a result of EVFTA, Vietnamese pangasius seeks to reenter the competition for market share.

The EU was formerly Vietnam's largest pangasius import market, with peak sales of $511 million in 2010, representing 36% of Vietnam's pangasius exports. In the subsequent years, however, pangasius exports to this market plummeted due to negative media campaigns in some European nations. Specifically, Cuatro TV station in Madrid, Spain broadcast false information about images of Vietnamese pangasius raised in the Mekong River at the beginning of 2017. According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the European supermarket chain Carrefour Group ceased selling pangasius in Spanish stores immediately after this report. Belgium and on French fruit and vegetable stands. Some Spanish schools also refuse to serve Vietnamese pangasius.

Long affected by the COVID-19 epidemic, Vietnam's pangasius exports to the EU will experience a breakthrough increase in 2022 due to a sharp rise in demand. The Russia-Ukraine conflict and a series of sanctions imposed by other nations on Russia's economy and trade have increased the EU's demand for whitefish imports from Vietnam.

In the effort to gradually bring Vietnamese pangasius back to the race track after decades of difficulties, Pangasius exports to the EU 4 decreased in the first month of this year compared to the same period last year.

The export value of leather, footwear, electronics, and textiles to France accounts for approximately 60% of Vietnam's total export value to France. Vietnam's exports to France reached more than 2.12 billion euros (approximately 2.3 billion U.S. dollars) in the first four months of 2023, despite a declining global economy and difficult trends for export goods in general.

In addition to textile and apparel exports exhibiting signs of deceleration, footwear and phone exports grew substantially during the same period in 2022, at rates of 30.5% and 21.9%, respectively. Including the previous year, our exports to France increased by 18.8% between 2020 and 2021, from 6.12 billion euros (approximately 6.64 billion USD) to over 7.27 billion euros (approximately 7 billion USD).89 billion US dollars) - a record high.

EVFTA's prestige and preferential tariff conditions are creating advantageous conditions for Vietnam's exports. Vietnam is one of the potential destinations for France and Europe as they seek to diversify their supply and invest in production to reduce their reliance on China. After the Vietnam Trade Office in France implemented a series of promotional activities, image building, and consumer orientation on the French market, Vietnamese products are gradually gaining a foothold and gaining consumer favor. Native usage is recognized.

In addition to taking advantage of the EVFTA's benefits, Vietnamese businesses must have a methodical development plan, identify the appropriate target market from which to continuously improve product quality, and learn and meet the standards by the requirements of the target market.

Phong Linh