Vietnamese goods entering EU not straightforward under EVFTA

Quality standards, rules of origin, and legal aspects are said to be among the barriers Vietnamese businesses will have to overcome to gain a foothold in the European market under the EU-Vietnam Free Trade Agreement (EVFTA).
vietnamese goods entering eu not straightforward under evfta

In the EVFTA, the two sides commit to eliminating 99 percent of import tariffs on each other’s goods within seven years in the EU and 10 years in Vietnam (Photo: VNA)

The European Parliament ratified the EVFTA on February 12 and Vietnam’s National Assembly did likewise on June 8. The pact is expected to take effect in August.

Following the agreement being ratified in Vietnam, EU Trade Commissioner Phil Hogan wrote on Twitter “This deal will increase opportunities & cooperation between us, create jobs, drive investment & improve standards. With the right rules, trade can benefit everyone.”

The two sides commit to eliminating 99 % of import tariffs on each other’s goods within seven years in the EU and 10 years in Vietnam.

The Southeast Asian country pledges to remove 48.5 % of tariff lines on EU goods immediately when the deal comes into force, 58.7% within three years, 79.6% within five years, 91.8 % within seven years, and 98.3% within 10 years. It is also set to abolish the majority of tariffs on exports to the EU within 15 years.

Despite considerable opportunities, an array of challenges is also awaiting Vietnamese goods on the road to the EU.

Quality standards are among such challenges.

The EU will cut tariffs under the EVFTA but its technical standards remain unchanged, so Vietnamese products must meet these standards before entering the market.

EU countries have recently been in dire need of medical supplies, including face masks, to cope with the COVID-19 pandemic. Many Vietnamese enterprises are capable of producing a large quantity but their products are still unable to enter the EU since they only meet Vietnamese standards.

Talking about agricultural exports, Nguyen Canh Cuong, former Trade Counsellor of Vietnam in Belgium, said Europe has strict and regularly-updated regulations on the use of pesticides, and the rules often outpace research by chemical companies.

Whenever the EU revises its regulations, exporters must also change the pesticide types they use, thus raising production costs. If businesses do not comply with these regulations, their exports to the EU will be cancelled or returned if violations are detected, he noted.

Pierre Groning from the German Chemical Industry Association said rules of origin may also be a challenge for small- and medium-sized enterprises in Vietnam.

They should proactively learn about and adhere to EU regulations so as to have their products’ origin certified in line with the EVFTA’s rules of origin, he recommended, noting that this could force them to make changes to both production processes and input materials.

Nonetheless, he went on, the agreement will also bring them rare opportunities to enhance their competitiveness and be innovative.

According to the Belgium-Vietnam Chamber of Commerce, companies will have to compete with one another not only in product quality and price but also in their understanding of the European market, especially technical and legal issues.

Chamber Chairman Huynh Trang Long pointed out that there are major differences between Vietnam and European countries in the use of commercial techniques.

He took payment methods as an example, saying that many Vietnamese businesses, both exporters and importers, make payments by telegraphic transfer, as this method is quite simple. Risks from this method may be negligible for Vietnamese enterprises in general but not for importers, as it may lead to disputes.

European enterprises often prioritise letters of credit for making payments, he said, suggesting Vietnamese companies consider doing likewise.

Long also recommended that local enterprises equip themselves with preventive measures, since international trade always features unpredictable risks relating to geographical distance, transportation, and law.

Meanwhile, Cuong warned that companies that do not have sufficient risk assessment capacity could be coerced by partners, which may subsequently cause financial losses.

Without experts on EU law, he said, the risk of loss is quite high.

Source: VNA
english.vov.vn

Related News

Highest determination to remove IUU "yellow card".

Highest determination to remove IUU "yellow card".

VCN - The 5th inspection of the European Commission (EC) is expected in October 2024, which is the decisive time for Vietnam to remove the "Yellow Card" warning in 2024. This is considered an important and urgent and important task because the EU is in the top 5 largest export markets of Vietnamese seafood, after the US and China.
Hanoi Customs faces difficulties in state budget collection

Hanoi Customs faces difficulties in state budget collection

VCN - According to Hanoi Customs Department, although the import-export turnover of goods in the first six months of the year at the unit increased, many imported products with large revenue contribution and high tax rates decreased, having a great impact on the unit's budget revenue results.
Consumption index of the entire processing and manufacturing industry increased by 10.8%

Consumption index of the entire processing and manufacturing industry increased by 10.8%

VCN - In the first 6 months of 2024, the consumption index of the entire processing and manufacturing industry increased by 10.8% compared to the same period in 2023 (the same period last year decreased by 2.2%), while the decrease of the inventory index is the positive signal that shows the recovery of industrial production.
E-commerce: The door to bring Vietnamese goods to the world

E-commerce: The door to bring Vietnamese goods to the world

VCN - Cross-border e-commerce is one of the important pillars on the journey to promote Vietnam's export potential. On the Amazon e-commerce platform alone, Vietnamese businesses have expanded their international business scope with the number of products exported and sold on Amazon increasing by 300% in the past 5 years.

Latest News

Technology increases competitiveness in the logistics race

Technology increases competitiveness in the logistics race

VCN - In the context that the logistics industry in Vietnam is forecast to continue to grow strongly, many businesses are actively applying technology and expanding service chains to take advantage of opportunities and keep pace with the general trend.
MoIT proposes key solutions to cope with rising sea freight prices

MoIT proposes key solutions to cope with rising sea freight prices

The Ministry of Industry and Trade (MoIT) has requested local associations and businesses to coordinate implementing key solutions to promote imports and exports as sea freight rates rise.
Vietnamese seaports to handle 1.2-1.4 billion tonnes of cargo by 2030

Vietnamese seaports to handle 1.2-1.4 billion tonnes of cargo by 2030

Vietnam's seaport cargo throughput is set to reach 1.2-1.4 billion tonnes by 2030, with container cargo expected to range from 46.3 to 54.34 million TEUs, according to a detailed plan for the development of seaport groups, wharfs, jetties, buoy berths, and water areas in 2021-2030, with a vision to 2050.
Binh Dinh seeks investment opportunities from Germany, France

Binh Dinh seeks investment opportunities from Germany, France

A delegation from the south central province of Binh Dinh led by Permanent Vice Secretary of the provincial Party Committee Le Kim Toan paid a working trip to Germany and France to explore investment opportunities from July 17-22, reported the provincial Department of Planning and Investment.

More News

Warnings as HRC steel imports continue to increase rapidly

Warnings as HRC steel imports continue to increase rapidly

The amount of imported hot-rolled coil steel in the first six months of this year increased sharply to an alarming level, 1.7 times higher than domestic production.
MoIT warns about international trade fraud

MoIT warns about international trade fraud

Trade experts said that the number of cases was increasing and taking place in all markets from Africa, the Middle East, India to developed countries such as the US, the Netherlands, and Italy.
Enterprises self- renovate to promote exports to the Central region

Enterprises self- renovate to promote exports to the Central region

VCN - Opportunities to cooperate and promote the export of products of Central region enterprises directly into foreign distribution networks and effectively participate in the global production value chain... are assessed to have a lot of potential.
Corporate culture "lighting the way" for sustainable development

Corporate culture "lighting the way" for sustainable development

VCN - The government aims to cultivate and develop numerous business leaders capable of heading strong economic conglomerates by 2030, leveraging their roles to lead and pave the way. To achieve this goal, financial strength alone is not enough; a robust foundation in business culture is essential.
The fast-moving consumer goods industry aims for green and sustainable development

The fast-moving consumer goods industry aims for green and sustainable development

VCN - Vietnam's consumer goods industry currently has the fastest growth rate in the ASEAN region. However, for sustainable development in the future, businesses in the fast-moving consumer goods industry need to aim for green consumption.
Stronger “medicine” needed to help businesses overcome difficulties

Stronger “medicine” needed to help businesses overcome difficulties

Businesses have suggested the Government maintain its support to help them overcome difficulties, recover production and business activities, and promote growth, given the fact that many of them still face difficulties despite the country’s GDP growth rate of 6.42% in the first half of this year.
Insiders optimistic about durian export to China

Insiders optimistic about durian export to China

Insiders believe in a bright prospect for durian export to China though the world’s largest durian consumer is expanding the cultivation of this fruit.
Vietnam

Vietnam's cashew industry facing fluctuations in raw material prices

VCN - Although exports recorded double-digit growth in the first half of 2024, Vietnam's cashew industry is facing fluctuations in raw material prices.
Many seafood enterprises focus on developing the domestic market

Many seafood enterprises focus on developing the domestic market

VCN - In addition to promoting exports, many seafood businesses are expanding their market share in the domestic market to complete their plans.
Read More

Your care

Latest Most read
Technology increases competitiveness in the logistics race

Technology increases competitiveness in the logistics race

VCN - Logistics plays an important role in the entire process from social production, import and export, circulation and distribution to consumption, creating added value, making an increasingly greater contribution to promoting the growth of the country'
MoIT proposes key solutions to cope with rising sea freight prices

MoIT proposes key solutions to cope with rising sea freight prices

The Ministry of Industry and Trade (MoIT) has requested local associations and businesses to coordinate implementing key solutions to promote imports and exports as sea freight rates rise.
Vietnamese seaports to handle 1.2-1.4 billion tonnes of cargo by 2030

Vietnamese seaports to handle 1.2-1.4 billion tonnes of cargo by 2030

Vietnam's seaport cargo throughput is set to reach 1.2-1.4 billion tonnes by 2030, with container cargo expected to range from 46.3 to 54.34 million TEUs, according to a detailed plan for the development of seaport groups, wharfs, jetties, buoy berths, and water areas in 2021-2030, with a vision to 2050.
Binh Dinh seeks investment opportunities from Germany, France

Binh Dinh seeks investment opportunities from Germany, France

A delegation from the south central province of Binh Dinh led by Permanent Vice Secretary of the provincial Party Committee Le Kim Toan paid a working trip to Germany and France to explore investment opportunities from July 17-22, reported the provincial Department of Planning and Investment.
Warnings as HRC steel imports continue to increase rapidly

Warnings as HRC steel imports continue to increase rapidly

The amount of imported hot-rolled coil steel in the first six months of this year increased sharply to an alarming level, 1.7 times higher than domestic production.
Mobile Version