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Vietnam’s products benefited from EVFTA

29/12/2020

Seafood, rice, textiles, footwear, plastic products, etc. are items that are quick to seize opportunities to boost exports to the EU market as soon as EVFTA took effect from August 1, 2020.

Vietnam's group of agricultural and aquatic products such as seafood, rice, coffee, etc. are considered commodities that are quick to seize opportunities to boost exports to the EU market right after the Vietnam - EU Free Trade Agreement (EVFTA) took effect from August 1, 2020.

Data from the Ministry of Industry and Trade shows that, since the EVFTA Agreement took effect until the end of December 18, 2020, the authorized organizations have issued nearly 62,500 certificates of origin (C/O) to enjoy preferential treatment in the EU market with a turnover of USD 2.35 billion.

The items that have been granted C/O are mainly footwear, seafood, plastic and plastic products, coffee, textiles, bags, suitcases, vegetables, bamboo- rattan knitted products; agricultural products; electronics, etc.

EVFTA's implementation in the third quarter of 2020 has created positive changes on Vietnam's merchandise exports to the EU, a market that is currently experiencing a decline due to the impact of the Covid-19 pandemic. Accordingly, Vietnam's exports to the EU market have continued to have positive results since the implementation of EVFTA.

Specifically, for the whole 2020, exports to the EU market are estimated at over USD 34.8 billion, a decrease of 2.3% over the same period in 2019 due to the negative impact of the pandemic. However, after 5 months of implementing the EVFTA Agreement, exports to the EU market reached about USD 15.38 billion, an increase of about 1.6% over the same period in 2019. Many export products of Vietnam have had positive changes in the EU market following the implementation of EVFTA, such as seafood, shrimp, rice, etc.

Deputy Minister of Agriculture and Rural Development, Phung Duc Tien, said that the impact of EVFTA was clear, when in September 2020, seafood exports increased by 10% over the same period in 2019; October increased by 12%; November increased by 13%. The EU market recovered strongly from September with an increase of 19-30%. Accumulated 11 months, exports to the EU reached USD 900 million. It is estimated that exports to the EU (excluding the UK) in 2020 will reach about USD 992 million.

However, the main driver for the recovery is the shrimp industry. By the end of November, shrimp exports reached about USD 3.5 billion, an increase of nearly 14% over the same period in 2019. Only shrimp exports to the EU reached USD 473 million, increased by 5.2% over the same period.

In addition to seafood, the story of Vietnam rice exported to the EU, which was sold for the first time at over USD 1,000/ton after the EVFTA took effect, created optimistic breeze for the agricultural industry. Right in August 2020, a number of enterprises exported rice containers to the EU to enjoy tax incentives under EVFTA, of which, Trung An High-Tech Agricultural Joint Stock Company successfully exported the first batch of 3,000 tons signed with an importer from Germany after EVFTA took effect, with two varieties of rice, ST20 and Jasmine.

At that time, Loc Troi Group exported fragrant rice batches to the EU under EVFTA with 126 tons of Jasmine 85 variety, packed in 18 kg specifications. According to EVFTA's commitment, the EU will give Vietnam a quota of 80,000 tons of rice/year. In particular, the EU will fully liberalize broken rice, this commitment will enable Vietnam to export about 100,000 tons per year.

Together with EVFTA, which has been in effect since 2020, the FTA with the UK (UKVFTA) has just ended the negotiation, the Ministry of Agriculture and Rural Development said that this will be a "launch pad" for Vietnam's seafood exports to accelerate in 2021.

 

Kylie Nguyen

© 2019 Vietnam Bank for Agriculture and Rural Development No. 2 Lang Ha street, Ba Dinh district, Hanoi, Vietnam
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