More opportunities for export sector in 2018

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Fabric production at an enterprise in Nhon Trach 6 Industrial Zone (Nhon Trach District) provided to Vietnamese garment enterprises to enjoy preferential treatment when exported to the EU and other FTA partner countries.

 

According to the Ministry of Industry and Trade, it is possible that the negotiation on Regional Comprehensive Economic Partnership (RCEP) will be complete in 2018. The RCEP is not merely a complementary trade agreement but also an agreement supplying the scale and scope to open up new growth potentials, as well as new regulations on international trade. Dong Nai is one of the 4 provinces and cities to have the largest export turnover in the country, so enterprises will pay significant attention to such information.

 

 

Deputy Minister of Industry and Trade Hoang Quoc Vuong said: "Vietnam - EU FTA will create more opportunities for Vietnamese goods to enter the EU market. EU is Vietnam's second largest trading partner with 20% of its exports to this market. "For the past few years, Vietnamese enterprises have taken initiative in input materials and other regulations to welcome FTAs with the EU. The purpose is that when the Vietnam-EU FTA goes into effect, enterprises will immediately enjoy the tax incentives.”

 

Mr. Le Bach Long, Vice Chairman of Dong Nai Young Entrepreneurship Association, Director of Nam Long Limited Company (Long Thanh District), said: "If the EU - Vietnam FTA is effective, Dong Nai will expand its export market to other countries in the union. This is a large market with 27 member countries so the opportunities are abundant. However, goods entering this market must meet the standards of origin and other specifications".

 

In recent years, the EU is the big export market of Dong Nai. The items local businesses are exporting to these countries include: textiles, footwear, wood products, electronic components, agricultural products ... Director of Department of Industry and Trade Duong Minh Dung said: "In 2018, Dong Nai's export turnover is expected to reach 18.3-18.5 billion USD, an increase of 9-11% over the previous year. This plan is achievable because this year the export markets provide more favorable conditions. In particular, Vietnam - EU FTA will be an opportunity for businesses in the province to expand exports to this large market. The EU market currently has 27 countries but Dong Nai's enterprises only export to 5-6 members of the union, while other markets are still pending for further plans.

Footwear, textiles, textile fibers, wood products, electronics and electronic components are the items that will significantly benefit from the Vietnam-EU FTA. As businesses in such fields have soon taken the initiative in terms of input materials, production technology ... At the same time, the EU is also a big market for Dong Nai’s key products.

 

Mr. Nguyen Van Hoang, Deputy General Director of Dong Tien Joint Stock Company, said: "About 65% of the company's garments are exported to the EU market. Therefore, Vietnamese-EU FTA will bring great advantages for export. Orders from this market are plentiful so the company is still recruiting more labor to expand production to fulfill the orders. The company is expected to increase its exports to the EU market."

 

Enterprises in the field of electronics, agricultural product processing, machinery and equipment, spare parts, steel, bamboo and rattan products... also have plans to expand the consumption of goods in the EU, especially the countries in the union which have long been unnoticed. President of Vietnam Textile and Garment Association Vu Duc Giang emphasized: "Vietnam's garment export turnover this year is estimated to reach USD 34-34.5 billion, up by USD 3-3.5 billion over 2016 mainly because the EU, the second largest textile and apparel export market of Vietnam, will reduce tariffs to 0%. The reduction of taxes will help businesses to increase their competitiveness in the same category over other countries, so it is easier to increase exports to the EU market". In addition, according to Jiang, if the RCEP is effective in 2018, it will help textile and other industries gain more export advantages.

 

According to the Ministry of Industry and Trade, the Vietnam-EU FTA will not only help increase the mutual trade but also attract investors from the EU and other countries into Vietnam. Specifically, in 2014 EU investment in Vietnam only ranked 6th but in 2017 it ranked 3rd. RCEP is a comprehensive regional partnership with 16 member countries, including 10 ASEAN ones together with China, Japan, Korea, India, Australia and New Zealand. The agreement has been negotiated since May 09 2013. If the RCEP is successfully finalized, it will create one of the largest free trade region in the world, with almost half of the global population and 39% of global GDP. The participating countries are rushed to complete the negotiation and sign the agreements in 2018.