Friday, October 05, 2007

EU emerges as Vietnam’s largest trade partner

17:50' 04/10/2007 (GMT+7)

Trade between Viet Nam and the European Union has gone from strength to strength since the two sides inked a framework agreement in 1975.

The EU now makes up 17 percent of Viet Nam’s foreign trade and is the Southeast Asian country’s biggest trade partner.

The EU now makes up 17 percent of Viet Nam’s foreign trade and is the Southeast Asian country’s biggest trade partner.
In the first six months of 2007 alone, two-way trade reached over 6.7 billion USD, increasing by 26.2 percent over the same period last year.

2005 marked a turning point with bilateral trade revenues skyrocketing to 8.1 billion USD, representing an increase of 27 fold over 1990 or doubling the 2000 figure.

Viet Nam’s exports to the EU surpassed 7 billion USD in 2006, increasing by 2.5 times over 2000, while imports from the bloc were estimated at 3 billion USD or 2.4 times over the first year of the decade.

Staple exports to the continent included footwear, apparel, seafood, fine art, bicycles, coffee and tea. Footwear netted the biggest slice of the pie with almost 2 billion USD worth of products sold in 2006. Apparel ranked second with over 1.24 billion USD coming into domestic coffers.

Germany, the UK, France and Holland have for years been Viet Nam’s largest export markets in the EU with annual growth rates estimated at between 20 and 30 percent.

Viet Nam’s major imports included equipment, machinery, technology, garment and textile materials and accessories, steel, pharmaceuticals, chemicals and chemical products.

A major reason behind the remarkable growth lays in the preferential taxes the two sides have granted each other over the years, said Dinh Van Hoi, Deputy Head of the Europe Department under the Ministry of Industry and Trade.

Hoi also highlighted Viet Nam’s efforts in issuing a masterplan on Viet Nam-EU relations on June 14, 2005, a programme of action for the 2006-10 period and an orientation for 2015 as effective tools in boosting bilateral trade ties.

Along with the framework agreement, Viet Nam and the EU have signed a number of other deals such as the Garment and Textile Agreement, an accord on footwear trade fraud control and an agreement on market approaches.

The two sides in 2004 concluded bilateral negotiations on Viet Nam’s World Trade Organisation membership.

However, barriers do still stand in the way of bilateral trade as the EU is imposing tough conditions on labour, environment and anti-dumping cases and ignoring Viet Nam’s development level in bilateral negotiations on the opening of markets, Hoi said.

He said for new heights to be reached in bilateral trade, further negotiations on trade policies, especially those with a direct impact onto the Vietnamese economy such as competitiveness and technological standards, are necessary.

Hoi also urged the bloc to intensify investment in oil and gas, new energies, shipbuilding, hi-tech industry and software technology.

(Source: VNA)