National Assembly officially approves EVFTA, EVIPA

The EVFTA received approval of 95.45 percent of voters, while the figure for EVIPA was 94.62 percent. (Photo: VNA)

The National Assembly passed resolutions ratifying the EU – Vietnam Free Trade Agreement (EVFTA) and Investment Protection Agreement (EVIPA) at its ongoing ninth session in Hanoi on June 8.

The EVFTA received approval of 95.45 percent of voters, while the figure for EVIPA was 94.62 percent.

Both agreements were signed between Vietnam and the EU in Hanoi on June 30, 2019.

The NA’s resolution ratifying the EVFTA stipulates the direct application of the full trade pact excluding clauses 2, 3, 4, and 5 in Article 3.57 of Chapter 3. To carry out the excluded terms, the NA will issue a resolution on approving and allowing the enforcement of judgments by agencies handling investment conflicts under the agreement.

Full content of the EVIPA is also applied directly as stipulated by the resolution ratifying it. The pact is set to be applied to the UK from the time it takes effect to December 31 2020. The duration can be extended to a maximum of 24 months following the agreement between Britain and the EU on the withdrawal of the nation from the bloc.

The EVFTA is expected to give Vietnamese companies better access to European markets, thus ensuring Vietnam’s economic security.

The trade pact will erase import tax for Vietnamese products. In exchange, Vietnam is expected to become more attractive to European investors.

The trade pact is expected to boost Vietnam’s total gross domestic product (GDP) by 2.4 per cent and exports by 12 per cent by 2030 while helping reduce poverty for 100,000-800,000 Vietnamese people.

In the early stage, tariffs will fall to zero per cent for 71 per cent of Vietnamese exports. Soon, all Vietnamese products will enjoy zero per cent when being shipped to Europe.

The EVIPA will help Vietnam strengthen its important political and economic position in the Southeast Asia and Asia-Pacific regions, heightening the nation’s status in ASEAN and other international organisations.

The investment protection deal will encourage Vietnam to keep working to complete its legal system and improve the investment and business environment for all investors.

The EVIPA will replace the 21 bilateral investment protection agreements that Vietnam has with European governments. The agreement contains four chapters, 92 articles and 13 appendices.

The ratification of the two deals will help tighten the bond between Vietnam and the European Union in economic development, trade and investment.

The COVID-19 pandemic has greatly affected the production and import-export of not only Vietnam, but the world. Therefore, the ratification of the EVFTA is extremely important to accelerating the process of economic recovery and direct the strategic shift of production, supply and consumption chains towards sustainability and more equilibrium for Vietnam and EU member states.

On the business side, especially for small- and medium-sized enterprises (SMEs), the EVFTA approval and supportive methods will improve the competitiveness of Vietnamese products and businesses, providing them market diversification opportunities and helping regain growth momentum after the disease outbreak.

To ensure the effective and full implementation of the agreement, the Government has assigned the MoIT to elaborate on the major orientation and main contents of the Government's Action Plan on the Implementation of EVFTA.

The MoIT has implemented five main task groups, in which propaganda, information dissemination and awareness-raising about opportunities and challenges of the agreement have been promoted.

The ministry in collaboration with the Vietnam Association of Small and Medium Enterprises recently held a meeting to help SMEs take advantage of opportunities and effectively implement the EVFTA. In this conference, they created a full awareness of the opportunities, challenges and requirements for the business community to renew itself and improve competitiveness.

Legislators also voted on the resolutions ratifying the EVFTA, the EVIPA and the ILO’s Convention 105 (Abolition of Forced Labour Convention), which won the majority of support./.