EU:FTA with Vietnam set to boost European alcoholic beverages industries

作者: edited by Jan        来源: Economic and Commercial Section Mission of Vietnam to the EU

Brussels, 15 September 2016 - The EU’s free trade agreement with Vietnam will boost European exports of alcoholic beverages, growth and job creation, as well as the development of Vietnam, according to EU trade negotiators, experts and business leaders. Speaking at an event by the Mission of Vietnam to the EU and BusinessEurope on 14 September in Brussels, the chief negotiators and ambassadors from both sides were joined by leading EU trade association representatives in urging for the speedy ratification and entry into force of the agreement.

The alcoholic beverages sector is growing strongly in Vietnam and the FTA, by eliminating tariffs, will provide a major extra boost.

“Trade is hugely important for our sector,” said Paul Skehan, Director General of Spirits Europe. “We’ve already seen a doubling of our export revenues over the last decade from five to ten billion Euros” and removing tariffs which are currently at 45% for EU spirits entering Vietnam will greatly expand the market, he explained. The provisions for the protection of geographical indications such as “Scotch” or “Cognac” would also maintain the value of the market.

For the industry, the sooner the agreement comes into force the better. “It will take seven years for the tariffs to drop to zero but ASEAN [regional] trade in spirits will be duty-free from 2018 so we’ll already be at a disadvantage for many years,” said Mr. Skehan.

The FTA is also set to benefit the brewing industry. Roland Verstappen from Heineken pointed out that although the brewing industry “believe[s] in local industry, local sourcing and manufacturing for local markets”, the FTA “will spur new investments in the whole value and supply chain” and accelerate the transfer of technology and skills. This will benefit European industries in Vietnam, but also “support local growth and sustainable development”. Heineken International is already the second largest brewer in Vietnam with six breweries supporting 2000 direct jobs and 80,000 jobs across the value chain. Tariffs for beer imports from Europe into Vietnam are currently at 35% and will be gradually eliminated over a period of 10 years under the terms of the FTA.

Goods produced in Vietnam will also have duty-free access to the 630 million plus strong Asian Economic Community and with the impending Trans-Pacific Partnership to the largest free trade area in the world.

“Vietnam is a very attractive destination for investment,” said Vietnamese Vice-Minister for Trade and Industry Mr. Tran Quoc Khanh. “Anything produced in Vietnam enjoys tariff free export to most of world.”

 

Background:
The EU-Vietnam FTA was concluded on 2 December 2015. Signature is expected in early 2017 with entry into force by 2018. It is the EU’s FTA second with a Southeast Asian country (after Singapore) and links the EU market with the 90 million consumers in Vietnam – with a middle class expected to reach 30 million by 2020. It is the most ambitious and comprehensive FTA that the EU has ever concluded with a middle income country. The agreement will eliminate 99.8% of duties on European products gradually over a 10 year period. Two-way trade between the EU and Vietnam was over 45bn euros in 2015 and is set to increase this year. This successful model of FTA is expected to be followed with more countries from the region, including the Philippines, Malaysia and Indonesia.

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