A group of European business associations have again joined forces to urge the European Council to approve the EU-Vietnam Free Trade Agreement (EVFTA), a deal they say will boost economic growth and promote job creation both in the EU and Vietnam.
Finalised in December 2015, the trade deal is the most ambitious ever concluded between the EU and a developing country. It will eventually eliminate virtually all tariffs on goods traded between the two sides.
The agreement also includes a legally binding commitment to sustainable development, including the respect of human rights, labour rights, environmental protection and the fight against climate change, with an explicit reference to the Paris Agreement.
The pact was adopted by the European Commission in October of last year, and is now undergoing final legal review ahead of its signature and conclusion.
In a joint letter addressed to Donald Tusk, president of the European Council, and EU Trade Commissioner Cecilia Malmstrom, ten business associations – including including Amfori and the Federation of the European Sporting Goods Industry (FESI) – have appealed for a swift consideration and approval of the deal.
“Now, more than ever, it is critical that the EU continues to deliver on its agenda to advance an ambitious and sustainable trade policy that offers benefits for society at large, especially when protectionism is on the rise in many parts of the world,” the letter states.
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By GlobalData“As leaders of European trade and business associations, we write to urge the Council to consider and approve the EU-Vietnam Free Trade Agreement (EVFTA), an agreement that will boost economic growth and promote job creation both in the EU and Vietnam. The EVFTA negotiations were concluded three years ago, and the agreement is now undergoing final legal review. We call on the Council and all member states to dedicate the resources necessary to complete this review expeditiously so that the agreement can be approved in early 2019.”
Time is of the essence, the groups say, adding that as a fast-developing country of over 90m people with a growing middle class, Vietnam is an increasingly important consumer and sourcing market for EU companies.
However, they add that European companies are facing increased competition from countries with which Vietnam has free trade agreements, notably the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – which entered into force between six countries at the beginning of January and was joined by Vietnam today (14 January).
“If the EVFTA is not approved by the current Council and Parliament, EU businesses risk losing market share in important sectors in Vietnam and harming their competitiveness in the region,” the letter says.
The signatories argue that in addition to its commercial benefits, EVFTA will deepen EU ties with a “strategically important partner” in Southeast Asia – and also fill a void created by the US withdrawal from TPP and enable Vietnam to further diversify its global trading links.
The group urges the EU to avoid further delay by concluding the legal review so that the European Parliament can ratify the EVFTA before the European elections in May 2019.
“Failure to do so would create uncertainty, send the wrong message to our trading partners, and hurt the EU’s credibility in the global trading community,” it says. “We therefore respectfully urge you to support the ratification and implementation of this important trade agreement.”
