Source: Socialist Republic of Vietnam
Vietnam is among countries in ASEAN and the Asia-Pacific to have developed comprehensive relations with the EU, he said, describing the signing of the EU-Vietnam Free Trade Agreement (EVFTA) as an extraordinary step in bilateral ties.
The trade pact is the first comprehensive and ambitious trade and investment agreement the EU has ever concluded with a developing country in Asia, said Borrell, who is Vice President of the European Commission.
The EU is Vietnam’s second-largest export market, accounting for 17% of its total exports. Since Vietnam’s exports to the EU make up just 2% of the bloc’s total imports, there is huge space for the country to boost shipments. Two-way trade has in fact shot up over recent years, with exports primarily being furniture, telephones, machinery, and footwear, while the EU’s exports are mainly aircraft, machinery, pharmaceuticals, and electrical equipment.
The EVFTA came into force at a time when the global economy had been battered by the COVID-19 pandemic, and has created motivation for trade in goods between the two and boosted the confidence of EU and other investors seeking to develop Vietnam-EU trade links.
Despite the pandemic, the implementation of the deal has already shown robust signs, with Vietnam’s exports to the EU in August and September topping US$3.25 billion and US$3.1 billion, respectively, year-on-year increases of 4% and 9.5%.
The EVFTA is expected to bring more practical benefits to businesses and people of both sides in the medium and long terms. It is projected to help Vietnam increase its GDP by 4.6% and exports to the EU by 42.7% by 2025. Meanwhile, the EU’s GDP will rise by an additional US$29.5 billion and shipments will increase 29% by 2035.
Borrell also hailed Vietnam, a member of ASEAN and the UN, as an attractive partner of the EU, saying the forums the country has engaged in are vivid illustrations of its strong commitment to multilateralism and a rules-based international order.
At the 53rd ASEAN Foreign Ministers’ Meeting on September 12, Deputy Prime Minister and Foreign Minister Pham Binh Minh affirmed that in its role as ASEAN Chair 2020, Vietnam supported efforts to deepen ASEAN-EU relations towards upgrading ties to a strategic partnership.
Vietnam’s efforts paid off, with ASEAN and the EU announcing the official upgrade of ties to the strategic partnership level on December 1.
Leaders of both sides pledged to make further efforts to create a practical framework for an ambitious ASEAN-EU free trade agreement, which expresses their strong commitment to providing benefits to their people through economic integration and trade liberalisation.
The EVFTA could be used as a model if the EU was to decide to clinch free trade deals with ASEAN or other member states.
Regarding peace and security, Vietnam and the EU have signed a Framework Participation Agreement (FPA), paving the way for Vietnam to join the crisis management activities of the EU. The first of its kind the EU has inked with an ASEAN country, the agreement will help contribute to the EU’s activities in global peace and security.
Consultations on security and defence between the two sides are held regularly. At the second consultation, held on December 1, the two sides reiterated their commitment to maintaining a rules-based international order, freedom of navigation, and the unity and universality of the 1982 United Nations Convention on the Law of the Sea (UNCLOS).
Vietnam and the EU called upon relevant parties to settle disputes at sea via peaceful means and in line with the 1982 UNCLOS.
Ambassador Vu Anh Quang, head of the Vietnamese mission to the EU, said Vietnam sees comprehensive cooperation with the EU – the world’s leading economic-political hub – as a top priority in its foreign and international integration policies.
Both sides have created frameworks and mechanisms to bolster bilateral relations, such as the Framework Agreement on Partnership and Cooperation (PCA), which created a breakthrough for the signing of the EVFTA and the EU-Vietnam Investment Protection Agreement (EVIPA), he said, expressing his hope that the ties will develop in a more practical and comprehensive manner, particularly in economy, politics, trade, and investment.
Since the establishment of diplomatic ties in 1990, Vietnam and the EU have experienced sound cooperation in various spheres. At the second meeting of the Joint Committee under the EU-Vietnam Comprehensive Partnership and Cooperation Framework Agreement on December 15, both sides agreed to enhance the bilateral partnership as well as cooperation at multilateral forums, so as to maintain a rules-based international order and promote peace and prosperity through sustainable recovery.