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Viet Nam and the Eurasia Economic Union signed Free Trade Agreement
25/6/2016 15:36' Send Print
The signing of the Free Trade Agreement between Viet Nam and the Eurasian Economic Union. Photo: Vietnam News Agency

The FTA between Viet Nam and the Eurasia Economic Union is the new generation, modern and comprehensive FTA with necessary flexiblity, high-level commitments and ensures balanced benefits, taking into account specific conditions of each side. It is a breakthrough of strategic significance, opening a new page in the cooperative relations between Viet Nam and the Eurasia Economic Union in general and to each member in particular.

Together with other FTAs, the pact will assist expansion of market for export of commodities, services and invesment of Viet Nam to the Eurasia Economic Union, creating important premise for Viet Nam to push forward commercial and invesment in members of the Commonwealth of Independent State (CIS), many of which have expressed their desire to become members of the Eurasia Economic Union.

The Agreement includes main chapters on Trade in Goods, Rules of Origin, Trade in Services, Investment and Intellectual Property, Sanitary and Phytosanitary measures (SPS), Customs facilitation, Technical Barriers to Trade (TBT), Electronic Technology in Trade, Competition, Legal and institution, among others.

About goods, the Union gives Viet Nam incentives, creating more important export opportunities for Viet Nam’s commodity of strength such as agricultural products, industrial goods as textiles, footwear, furniture and some processed products.

An important part of this Agreement is the Union will apply the tax rate of 0% for all aquatic products of Viet Nam right after the agreement takes effect. Along with the elimination of tariffs, the two sides will actively implement the SPS program, including the contents of equivalence for the treatment or management systems in related fields, mutual recognition on the concept of adaptation to regional conditions and use of audit results, information of major international organizations, promoting cooperation and implementing initiatives of trade facilitation, technical assistance and establishing effective mechanisms for consultation between the two parties.

Viet Nam agrees to open the market under roadmap for the Union for some livestock products, some industrial commodities including machinery, equipment, vehicles, among others. These goods generally do not compete with Viet Nam’s goods but on the contrary contribute to more diversification of the domestic market.

For agricultural products, though the Union is given priority and Viet Nam agrees to open for the Union’s products such as milk and milk products, and some starch food, in the current context, these goods are mainly for the Union’s consumption and not for export, thus as projected in the first five years of implementation, Viet Nam’s agriculture will not be affected by imports of agricultural products from the Union.

In overall, the two sides plan for market access of goods accounted for about 90% of tariff lines, equivalent to over 90% of bilateral trade turnover.

According to initial estimation of the Eurasian Economic Union, after the agreement comes into effect, bilateral trade turnover is expected to reach US$10-12 billion by 2020. In 2014, it was US$4 billion.Viet Nam’s export turnover to the Union will increase by 18-20% annually.

Other contents on intellectual property, competition, and sustainabble development in the Agreement are mainly cooperative and within Viet Nam’s commitments to the World Trade Organization (WTO) and other FTAs already signed or are under negotiations, creating a framework for the two sides to consider deeper cooperation when it is convenient.

The Eurasian Economic Union with a population of more than 175 million and GDP of US$ 2,500 billion, though newly established, has an extremely important role in the development of some members of the former Soviet Union towards a unified economic space.

The signing of the Agreement continues to testify the active and proactive role of Viet Nam in its comprehensive relations with members of the Eurasian Economic Union. The main goal of Viet Nam in negotiation and signing of the Agreement is to facilitate trade, services, investment, diversification of import, export market and avoid dependence on one market.

Also in Kazakhstan, Prime Minister Nguyen Tan Dung had talks with Kazakhstan President Nursultan Nazarbayev, Belarus Prime Minister Andrei Kobyakov; Armenian Prime Minister Hovik Abrahamyan; Russian Prime Minister Medvedev; Kazakhstan Prime Minister Karim Masimov; and Kyrgyzstan Prime Minister Sariev. He also had a joint meeting with Prime Ministers of members of the Eurosian Economic Union, and met with Chairman of the Standing Committee of the Union, Mr. Viktor B. Khristenko.

The leaders exchanged views on internal procedures of ratification of the Agreement and implementation of the Agreement when it comes into effect and agreed to effectively implement the Agreement in the spirit of friendship, contributing to socio-economic development of Viet Nam and members of the Eurasian Economic Union. 

Synthesized by ND