European textile and clothing outsourcers and buyers are buoyed that the European Union (EU) has started free trade negotiations with key exporter Vietnam.

The negotiations were launched yesterday (March 2) in Hanoi after a meeting between new EU trade Commissioner Karel De Gucht and Vietnam prime minister Nguyen Tan Dung.

Vietnam's textile and apparel exports rose 20% during 2009 to US$439m.

A European Commission communiqué said EU and Vietnamese officials would now work towards the formal start of negotiations, agreeing a structure for the talks before they begin.

It said: "This key step reflects the deepening trade relations between the EU and Vietnam," noting total bilateral trade in goods was almost EUR12bn in 2008, and trade increased 12% annually from 2004-2008.

"Vietnam has seen rapid economic and social transformation over the past decade. Vietnam is a good example of an economy successfully opening up to trade and investment…," added the commission, noting its GDP growth averaged 8% from 2003-2008, and was 5% last year.