The European Union and Vietnam signed a Trade Agreement and an Investment Protection Agreement on 30 June 2019. Accordingly, EU exports to Vietnam will be taxed less as of 1 August 2020. The trade agreement will ultimately scrap duties on 99% of all goods traded between the two parties. It reduces regulatory barriers and removes red tape in trade between the two countries. Also, European companies will have access to public procurement markets in Vietnam on an equal footing with their local competitors. Under the new agreement, economic benefits go hand-in-hand with a strong commitment to environment protection and implementing the Paris Agreement on climate, through strong, legally binding and enforceable provisions on sustainable development.
Under the agreement, the two parties have committed to implement the Paris Agreement as well as other international environmental agreements, and act in favour of the conservation and sustainable management of wildlife, biodiversity, forestry and fisheries, involving independent civil society in the monitoring the implementation of these commitments by both sides.
The EU-Vietnam agreement is the most comprehensive trade agreement the EU has concluded with a developing country. It takes fully into account Vietnam’s development needs by giving Vietnam a longer, 10-year period to eliminate its duties on EU imports. However, many important EU export products, such as pharmaceuticals, chemicals or machinery will enjoy duty free import conditions as the agreement enters into force. Agri-food products like beef or olive oil will face no tariffs after three years, while dairy, fruit and vegetables will enjoy zero tariffs after a maximum of five years.