The 9th round of negotiations on the Vietnam-EU free trade agreement (FTA) will take place in Vietnam's central Da Nang city on Sept.22-26, local Saigon Times daily reported Tuesday.
The report quoted Ambassador Franz Jessen, head of the Delegation of the European Union to Vietnam, as saying that negotiators at the next round of negotiations in Da Nang will seek ways to do away with outstanding differences.
Local media revealed that geographic indication and government procurement are among the main challenges.
Vietnam's apparel may enjoy FTA preferential tariffs in the EU market only if it is made from local materials or those from EU nations.
The EU official said the FTA would cut at least 90 percent of tariff lines on Vietnamese exports and this promises a great opportunity for Vietnamese businesses to further penetrate into the EU market.
Statistics from the Ministry of Industry and Trade (MoIT) showed that Vietnam exports to the EU represent around 20 percent of its outbound sales. Only 40 percent of these exports are tax free or subject to low duties (owing to the EU's unilateral preferences under GSP) while the remaining 60 percent are entitled to ordinary import duties (MFN).
Every year, Vietnamese producers could have saved 150 million euros (194.16 million U.S. dollars) for footwear and 180 million euros (233 million U.S. dollars) for textile products in each of the past three years (2011-2013) if a FTA had been in place. Under the current GSP system, Vietnamese footwear products are subject to import duties of 3.5-4 percent and textile products to 9.6 percent during pre-2014.
European pharmaceutical producers currently pay import duties of 5 percent to 8 percent for their exports to Vietnam. They would have saved nearly 60 million euros (77.6 million U.S. dollars) for their exports to Vietnam in 2013 if a zero duty had been applied.
As for telecommunication and distribution, Vietnam has already opened the sectors under the ASEAN FTA or other bilateral trade and investment deals. Therefore, the country has no reason to restrict market access for EU investors, said the EU official.
The forthcoming FTA will push necessary reforms in Vietnam and contribute to a more stable and predictable environment if it is implemented properly, and this will in return help boost foreign direct investment (FDI) flows, technology transfer and know-how sharing, according to the EU official.