Hanoi (VNA) – The EU-Vietnam Free TradeAgreement (EVFTA) strengthens EU economic links with Southeast Asia and willpotentially contribute to its recovery after the coronavirus crisis, moderndiplomacy.eu quoted an EUofficial as saying in a story published on August 3.

The EVFTA, which took effect on August 1, will not onlyultimately scrap duties on 99 percent of all goods traded between the two sidesbut also make it easier for European companies to do business in Vietnam,according to the site. They will now be able to invest and pitch for governmentcontracts with equal chances to their local competitors, it said.

Under the new agreement, the economic benefits go hand inhand with guarantees of respect for labour rights, environment protection andthe Paris Agreement on climate, through strong, legally binding and enforceableprovisions on sustainable development.

“The European economy needs now every opportunity torestore its strength after the crisis triggered by the coronavirus,” the sitequoted President of the European Commission Ursula von der Leyen as saying.

“Trade agreements, such as the one becoming effectivewith Vietnam today, offer our companies a chance to access new emerging marketsand create jobs for Europeans. I strongly believe this agreement will alsobecome an opportunity for people of Vietnam to enjoy a more prosperous economyand witness a positive change and stronger rights as workers and citizens intheir home country.”

“Vietnam is now part of a club of 77 countries doingtrade with the EU under bilaterally agreed preferential conditions,” EUCommissioner for Trade Phil Hogan commented. 

“The agreement strengthens EU economic links with thedynamic region of Southeast Asia and has an important economic potential thatwill contribute to the recovery after the coronavirus crisis.”

“It also shows how trade policy can be a force for good.Vietnam has already made a lot of effort to improve its labour rights recordthanks to our trade talks and, I trust, will continue its most needed reforms,”he noted.

According to moderndipmacy.eu, the EVFTA is the mostcomprehensive trade agreement the EU has concluded with a developing country.It takes fully into account Vietnam’s development needs by giving Vietnam alonger, 10-year period to eliminate its duties on EU imports.

However, many important EU export products, such aspharmaceuticals, chemicals or machinery already enjoy duty free importconditions as of entry into force. Agri-food products like beef or olive oilwill face no tariffs in three years, while dairy, fruit and vegetables inmaximum five years.

Comprehensive provisions on sanitary and phytosanitarycooperation will allow for improving market access for EU firms via moretransparent and quick procedures.

At the same time, the trade agreement expresses a strongcommitment of both sides to environment and social rights. It sets highstandards of labour, environmental and consumer protection and ensures thatthere is no “race to the bottom” to promote trade or attract investment.

Under the agreement, the two parties have committed toratify and implement the eight fundamental Conventions of International LabourOrganization (ILO), and respect, promote and effectively implement theprinciples of the ILO concerning fundamental rights at work.

They also agreed to implement the Paris Agreement, aswell as other international environmental agreements, and act in favour of theconservation and sustainable management of wildlife, biodiversity, forestry andfisheries.

Vietnam has already made progress on these commitments byratifying in June 2019 ILO Convention 98 on collective bargaining and in June2020 ILO Convention 105 on forced labour. It also adopted a revised Labour Codein November last year and confirmed that it would ratify the one remainingfundamental ILO Convention on forced labour by 2023.

The trade agreement also includes an institutional andlegal link to the EU-Vietnam Partnership and Cooperation Agreement, allowingappropriate action in the case of serious breaches of human rights.

Vietnam is the EU’s second largest trading partner in ASEANafter Singapore, with trade in goods worth 45.5 billion EUR in 2019 and tradein services of some 4 billion EUR in 2018.

The EU’s main exports to Vietnam are high-tech products,including electrical machinery and equipment, aircraft, vehicles, and pharmaceuticalproducts. Vietnam mainly ships to the EU electronic products, footwear,textiles and clothing, as well as coffee, rice, seafood, and furniture.

TheEVFTA is the second trade agreement the EU has concluded withan ASEAN member state, following the deal with Singapore./.