Vietnam currently enjoys trade preferences with the EU under the generalised preference system. Vietnam can also take advantage of institutional reforms and bilateral cooperation mechanisms and reaffirm to investors that it is the regional investment centre for improving technology, human resources and labour productivity. The Vietnamese Ministry of Commerce considered that the signing of these agreements would create opportunities to participate in the restructuring of new supply chains, amid the consequences of the coronavirus pandemic. Vietnam, which became the 150th member of the WTO in 2007, promised, after its accession, to fully comply with WTO agreements on customs assessment, technical barriers to trade (OTC) and health and plant health measures (SPS). The United States and Vietnam concluded a bilateral trade agreement (BTA) in 2000 that came into force in 2001. Vietnam is a member of the Association of Southeast Asian Nations (ASEAN) and a member of the ASEAN Free Trade Area (AFTA). As part of the AFTA, ASEAN members (including Brunei, the Philippines, Indonesia, Laos, Myanmar, Malaysia, Singapore, Thailand and Cambodia) are committed to making the region a competitive trading area. Along with the ASEAN countries, Vietnam has also signed trade pacts with China, the Republic of Korea, Australia and New Zealand, India, Chile and Japan. It signed a bilateral trade agreement with Korea in 2015 and a trade agreement with the Russian-led customs union bloc. Vietnam has concluded all bilateral negotiations on the Trans-Pacific Partnership (TPP) free trade agreement but has not yet ratified the agreement.
In February 2016, Vietnam concluded negotiations for a free trade agreement with the EU and is awaiting ratification by the Council of Ministers. Vietnam is currently negotiating a free trade agreement with EFTA countries (Norway, Iceland, Liechtenstein and Switzerland). Trade and investment agreements develop the commercial dimension of bilateral relations BETWEEN the EU and Vietnam, which are grounded and governed by the EU-Vietnam Framework Agreement on Partnership and Cooperation, which came into force in October 2016. The benefits of free trade agreements will enable Vietnam`s economic development to continue to move from the export of low-tech manufacturing products and primary products to more complex high-tech products such as electronics, machinery, vehicles and medical devices. The Free Trade Agreement between the European Union and Vietnam (EVFTA) is the second free trade agreement between the EU and an ASEAN country after Singapore. Vietnam is the second country to have signed trade and investment agreements in the region. Second, a large part of the direct export interest in Vietnam. The data below show that more than 70% of Vietnam`s exports are related to FDI.
EU investors will therefore also benefit from the increase in export capacity resulting from lower import duties in the EU. More importantly, the agreements call on Vietnam to adopt international standards that further increase the prospects for related exports, which are subject to rigorous monitoring of standards in jurisdictions such as the EU. In February 2020, the European Parliament ratified a free trade agreement (FTA) and an Investment Protection Agreement (PPI) with Vietnam. MEPs (ENPs) voted in favour of the agreements in Strasbourg. The EU`s bilateral trade and investment agreements with Vietnam in March 2020 and the trade agreement are expected to enter into force this summer, following Vietnam`s final ratification. The agreements with Vietnam are the second (after those with Singapore) between the EU and a South-East Asian country and are springboards for stronger engagement between the EU and the region.