Minister of Planning and Investment: EVFTA poses challenges for Vietnam

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The video conference on the action plan to implement the free trade agreement between the Socialist Republic of Vietnam and the European Union (EVFTA).

EVFTA to improve investment environment

According to the Minister Nguyen Chi Dung, within the EVFTA, the Ministry of Planning and Investment has chaired the negotiation on commitments to open the Government’s investment and procurement market.

In addition, the Ministry of Planning and Investment also chaired the negotiation and submission to competent authoritiesendorsing the EVIPA.

“It is fact that these agreements and 67 bilateral agreements on encouraging and protecting investment that Vietnam have signed in 30 years have contributed to strongly improving Vietnam’s investment and business environment towards more facilitation, equality, safety and friendliness for investors of all economic sectors,” said Minister Nguyen Chi Dung.

Besides, the implementation of the EVFTA and other new-generation free trade agreements has also posed challenges for Vietnam.

Particularly, Vietnam’s institutions, policies and management mechanisms have shortcomings: the infrastructure system and human resources have not met the economic development’s requirements.

Capacity and competiveness of Vietnamese enterprises are limited,the ability to absorb technology is limited and there are many difficulties in participating in the global value chain.

The broader access of foreign investors to the Vietnamese market will also put Vietnamese enterprises under greater competitive pressure in the domestic market.

The implementation of the dispute settlement mechanism under FTAs also poses greater challenges in law making and enforcement, prevention and effective handling of disputes and problems with investors.

There must be faster and more drastic action

According to the Minister of Planning and Investment, to effectively implement the EVFTA, it is necessary to perform tasks and solutions synchronously from both the State and enterprises.

Accordingly, the Ministry of Planning and Investment has developed an Action Plan to implement the agreement, focusing on four groups of tasks and solutions.

Firstly, to strengthen communication and disseminate information about the EVFTA and investment promotion activities;

Secondly, to further review and perfect institutions, policies and laws to improve the investment and business environment and ensure the implementation of Vietnam's commitments under the agreement;

Thirdly, to speed up the implementation of solutions to improve the competitiveness of the economy and businesses. This is one of the most important solutions to determine the success of the agreement’s implementation;

Fourthly, to build and perfect a mechanism to control and prevent disputes between the State and investors.

Minister Dung emphasized that the EVFTA will bring great opportunities for trade, investment and economic development in Vietnam, but also poses significant challenges.

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Therefore, it requires the Government, ministries, localities, organizations, associations and especially businesses to have faster and more drastic action to fully, synchronously and effectively perform the proposed tasks and solutions to responsibly implement signed commitments improve capacity, competitiveness and take full advantage of the opportunities brought by the EVFTA.