Wednesday, April 22, 2020Cosmetics news

International News: EU-Vietnam Free Trade Agreement

Actualités à l'international : Accord de libre-échange Union européenne-Vietnam

As part of its partnership with CosmeticOBS, Business France announces that on 21 January, the European Parliament’s International Trade Committee approved the free trade and investment protection agreements between the European Union and Vietnam. The committee approved the free trade agreement by 29 votes to 6, with 5 abstentions, and recommends that the plenary do the same. The agreement will abolish virtually all tariffs between the two sides in 10 years’ time. It will protect emblematic European products and give Europeans access to Vietnamese public procurement markets.

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Vietnam is the European Union’s (EU) second largest trading partner in the Association of South East Asian Nations (ASEAN) after Singapore, with €47.6 billion in trade in goods and €3.6 billion in services each year. EU exports to the country are growing by 5-7% a year, but the EU’s trade deficit with Vietnam amounted to €27 billion in 2018. The main products imported from Vietnam into the EU include telecommunications equipment, textiles and food products. The EU’s main exports to Vietnam are goods such as machinery and transport equipment, chemicals, cosmetics and agricultural products.

This free trade agreement is also an instrument for environmental protection and social progress in Vietnam, particularly in terms of labour rights, says the resolution accompanying the approval decision. The Committee on International Trade’s demands on Vietnam, notably concerning labour and human rights and the mechanism to ensure the application of sustainability clauses, were adopted by 29 votes to 9 with 2 abstentions.

The main elements of the free trade agreement

• Tariff elimination: 65% of EU exports to Vietnam will benefit from immediate tariff elimination. The rest (including pharmaceuticals, cosmetics, chemicals and other products) will be progressively liberalised within 10 years. 71% of Vietnamese exports …

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