FTA and PTT

IN VIETNAM
 VIETNAM’S FTA
The benefits of the free trade agreements will enable Vietnam’s economic
development to continue to shift away from exporting low-tech manufacturing
products and primary goods to more complex high-tech goods like electronics,
machinery, vehicles and medical devices. This can be done in two ways :

• first, through more diversified Sourching Partners through larger trade networks
and cheaper imports of intermediate goods from partner countries, which should
boost the competitiveness of Vietnam’s exports.

• Second – through partnership with foreign firms that can transfer the knowledge
and technology needed to make the jump into higher valued-added production.
An example of this is the recently launched VSmart phone manufactured by
Vietnamese conglomerate Vingroup.
Vietnam - EU (EVFTA)
• EVFTA and Trans-Pacific Partnership (TPP) are two of the largest new generation free trade agreements
that Vietnam's largest ever negotiated.
• The Agreement will eliminate nearly all tariffs (over 99%), except for a small number of tariff lines for
which the EU and Vietnam agreed on partial liberalisation through zero-duty Tariff Rate Quotas (TRQs)

• The agreement also covers non-tariff barriers to trade and other trade related aspects including:
 Trade in Goods, including cars and pharmaceutical products
 Customs and Trade Facilitation
 Rules of Origin
 Technical Barriers to Trade
 Sanitary and Phytosanitary Measures
 Intellectual Property Rights
 Geographical Indications
 Services and E-commerce
 Investment
 Government Procurement
 Sustainable Development
 Renewable Energies
 Antitrust, Mergers, State-Owned Enterprises, Subsidies
 Trade Remedies and Dispute Settlements

• EVFTA will enable UK firms to export and import at a lower cost and give more opportunity for UK
businesses to bid for public procurement contracts in Vietnam. It will increase the welfare of UK
households by lowering the price of goods and services and increasing consumer choice due to greater
competition.
Vietnam – Japan
• The Agreement between Vietnam and Japan for an Economic Partnership (VJEPA) was signed on December 25th, 2008 and
came into force on October 1st, 2009. This is the very first bilateral FTA of Vietnam, in which both Vietnam and Japan give
the other more preferences than that agreed under the Agreement for Comprehensive Economic Partnership ASEAN – Japan
(AJCEP).
• Its comprehensive content includes many areas including trade in goods, trade in services, investment, and improvement of
the business environment and movement of natural persons.
• Accordingly, in the last year of the tax reduction roadmap (in 2026), which is after 16 year implementation of this
Agreement, Vietnam has committed to eliminating 90.64% of the tariff lines and by the time the Agreement was effective,
29.14% of the tariff lines have been immediately deleted.
• The remaining ones are for CKD cars and other sensitive lines, which maintain the basic tariffs or do not reduce, accounting
for 9% on the groups including alcohol tobacco, some chemical products, explosives, rubber, cotton and steel
 Vietnam - South Korea
• Neither Party (Vietnam-South Korea) may adopt or maintain any prohibition or restriction on the
importation of any good of the other Party or on the exportation of any good destined for the territory of
the other Party, except in accordance with its WTO rights and obligations.
• In any circumstances in which any other form of restriction is prohibited, a Party from adopting or
maintaining:
(a) export and import price requirements, except as permitted in the enforcement of countervailing
and antidumping duty orders and undertakings;
(b) import licensing conditioned on the fulfillment of a performance requirement; or
(c) voluntary export restraints inconsistent with Article VI of GATT 1994, as implemented under
Article 18 of the SCM Agreement and Article 8.1 of the Anti-Dumping Agreement.
• In the event that a Party, in accordance with its WTO rights and obligations, adopts or maintains a
prohibition or restriction on the importation from or exportation to a non-Party of a good, no provision of
this Agreement shall be construed to prevent that Party from:
(a) limiting or prohibiting the importation of the good of the non-Party from the territory of the other
Party; or
(b) requiring as a condition for exporting the good of that Party to the territory of the other Party, that
the good not be re-exported to the non-Party, directly or indirectly, without being consumed in the
territory of the other Party.
• In the event that a Party, in accordance with its WTO rights and obligations, adopts or maintains a
prohibition or restriction on the importation of a good from a non-Party, the Parties, upon request of
either Party, shall consult with a view to avoiding undue interference with or distortion of pricing,
marketing, or distribution arrangements in the territory of the other Party.
 Vietnam - Eurasian Economic Union
• Free Trade Agreement between Vietnam and
Eurasian Economic Union (EAEU - including
Russia, Armenia, Belarus, Kazakhstan and
Kyrgyzstan) was officially signed on May 29,
2015, and took effect from October 5, 2016.
This is the first FTA of EAEU, which brings many
export opportunities to Vietnamese businesses
• The free trade agreement which covers more
than 90 percent of all traded goods has greatly
benefited EAEU’s exports of agricultural and
industrial products, and Vietnamese exports of
garments, textile products, farm products, and
electrical devices.
• In 2018, 5,535 tariff lines are going to be
reduced to zero percent. Reductions will focus
on items that are input materials for the
textiles, footwear, electronics, plastic,
fertilizers, and farming sector.
• Another 3,270 tariff lines will be reduced to
zero percent for goods such as milk and dairy
products, chemicals, automobiles, and spare
parts, steel products, rubber products, and
electrical appliances in 2018.
Vietnam - Chile
• According to the agreement, Vietnam commits to abandoning 87.8% the tariff rates (equivalent to 91.22%
as of 2007) for Chile for 15 years.
• In exchange, Chile shall eliminate tariff for the goods accounting for 99.62% of the export value of Vietnam
as of 2007 within 10 years; among them 81.8% export value and 83.54% types of tariff would be
abandoned immediately.
• A number of major exporting products from Vietnam, which would enjoy immediate tariff cut from the
current 6% to 0%, includes textiles (203 tariffs would be reduced to 0% instantly, 17 others will be
eliminated within 5 years), seafood, coffee, tea, computers and computer components (tariff cut to 0%
right after the agreement took effect).
• The rule of origin of the agreement is fairly easy to satisfy, most of products merely needs to have its
materials originated from member states (Vietnam or Chile) accounting for at least 40% or changes from
its initial level 4 position of HS so as to gain the favorable tariff treatment.
• Chile is the first Latin-American state Vietnam signs FTA with. This is also the eighth FTAs ever signed by
Vietnam. In the meanwhile, Chile had become a partner of 25 FTAs and trading with FTA partners
comprises of 80% the total import-export value of the country.
• Vietnam and Chile are both among the 12 negotiating parties of TPP.
 Source:
• http://www.wtocenter.vn/chuyen-de/12781-summary-of-vietnam-eu-
free-trade-agreement-evfta
• http://www.wtocenter.vn/fta/187-vietnam---japan/1
• http://www.wtocenter.vn/fta/189-vietnam---south-korea/1
• http://www.wtocenter.vn/fta/190-vietnam---chile/1
• http://www.wtocenter.vn/chuyen-de/4760-vietnam--eurasian-economic-
union-fta-full-content
 Trans-Pacific Partnership (TPP)
Trans-Pacific Partnership (TPP) is a Free Trade Agreement (FTA) among twelve country members, including
1. United States
2. Canada
3. Mexico
4. Peru
5. Chile
6. New Zealand
7. Australia
8. Japan
9. Singapore
10. Brunei
11. Malaysia
12. Vietnam

CPTPP maintain almost TPP commitments excluding:

(i) United States-related commitments;
(ii) 22 freeze clauses (having Detailed List); and
(iii) some modifications in Side Letters among CPTPP members.

News: Taxes on nearly 43 percent of Vietnam’s apparel exports to Canada will be removed immediately after
the agreement takes effect, and 100 percent after four years (Routers)

Source: http://www.wtocenter.vn/chuyen-de/12782-full-text-of-cptpp