Once ratified by the Vietnam National Assembly, the agreement will officially take effect, mostly likely in early summer this year, according to the European Council.
“This agreement is the second one we are concluding with a Southeast Asia country, after Singapore. It is also the most ambitious free trade agreement ever concluded with a developing country,” said Gordan Grlić Radman, Minister for Foreign and European affairs of Croatia that is currently assuming the role of the EU President.
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The FTA provides for the almost complete (99%) elimination of customs duties between the two sides. About 65% of duties on EU exports to Vietnam will disappear as soon as the deal enters into force, while the remainder will be phased out gradually over a period of up to 10 years.
As regards Vietnamese exports to the EU, 71% of duties will disappear upon entry into force, the remainder being abolished over a period of up to 7 years.
The FTA will also reduce many of the existing non-tariff barriers to trade with Vietnam and open up Vietnamese services and public procurement markets to EU companies.
The deal, together with the EU-Vietnam Investment Protection Agreement (IPA), was signed in Hanoi on June 30, 2019. They include intensive, extensive and comprehensive commitments covering the fields of economy, trade, investment and sustainable development issues.