Vietnam, EU sign landmark free trade deal

Vietnam, EU sign landmark free trade deal.

The European Union signed a landmark free trade deal with Vietnam on Sunday, the first of its kind with a developing country in Asia, paving the way for tariff reductions on 99% of goods between the trading bloc and Southeast Asian country.

The European Union has described the EU-Vietnam Free Trade Agreement (EVFTA) as “the most ambitious free trade deal ever concluded with a developing country”.

It was signed in Hanoi between European Union Trade Commissioner Cecilia Malmstrom and Vietnam’s Minister of Industry and Trade Tran Tuan Anh, three-and-a-half years after negotiations ended in December 2015.

It will eliminate 99% of tariffs, although some will be cut over a 10-year period and other goods, notably agricultural products, will be limited by quotas.

The EU is Vietnam’s second-largest export market after the United States, with main exports including garment and footwear products.

The Vietnamese government said on Sunday that EVFTA would boost EU exports to Vietnam by 15.28% and those from Vietnam to the EU by 20.0% by 2020.

The agreement will boost Vietnam’s gross domestic product by 2.18%-3.25% annually by 2023 and by 4.57%-5.30% annually between 2024-2028, the government said.

Source: Reuters