CEOE shows great satisfaction for the approval of the Agreement between the European Union and Vietnam, as MEPs gave their consent to the free trade agreement by 401 votes, 192 votes against and 40 abstentions. The "most modern, comprehensive and ambitious agreement that has been concluded between the EU and a developing country" will contribute to setting high standards in the region and could lead to a future trade and investment agreement from region to region, said Parliament in a resolution passed by 416 votes in favor, 187 against and 44 abstentions. The agreement is "an important signal in favor of free, fair and reciprocal trade, in times of growing protectionist tendencies and serious challenges for rules-based multilateral trade," said MEPs.
Elimination of customs duties
The agreement will eliminate virtually all customs duties between the two parties over the next ten years, including Europe's main export products to Vietnam: machinery, cars and chemicals. In addition, it is extended to services such as banking, shipping and postal transport, where EU companies will have better access. Companies may also bid for public tenders made by the Vietnamese government and several cities, including Hanoi. The agreement also protects 169 flagship European products.
The agreement is also an instrument to protect the environment and sustain social progress in Vietnam, including labor rights. The Asian country is committed to implementing the Paris Agreement and ratifying two bills as requested by Parliament, one on the abolition of forced labor and the other on freedom of association, by 2020 and 2023, respectively.
Dispute resolution
Separately, Parliament agreed by 407 votes in favor, 188 against and 53 abstentions to an investment protection agreement that provides an investment court system with independent judges to resolve disputes between investors and the state. The resolution was passed by 406 votes in favor, 184 against and 58 abstentions. In order for the investment protection agreement to enter into force, the parliaments of the EU member states must first ratify it.Background
Vietnam is the second largest trading partner of the EU in the Association of Southeast Asian Nations (ASEAN) after Singapore, with a trade of goods worth 47.6 billion euros a year and 3.6 billion euros in relation to services. EU exports to the country grow between 5% and 7% annually, however, the EU trade deficit with Vietnam was 27,000 million euros in 2018.
The main EU imports from Vietnam include telecommunications equipment, clothing and food products. The EU mainly exports products such as machinery and transport equipment, chemicals and agricultural products to Vietnam.
