Mekong Connect 2020 seeks to introduce products into global value chain

Delegates to the forum discussed various benefits and opportunities brought about by the implementation of the EU-Vietnam Free Trade Agreement (EVFTA) for agricultural products from the Mekong Delta region.

Reports show two-way trade turnover between Vietnam and the EU increased to EUR45 billion last year from just EUR10 billion euros in 2009, making the EU become the country’s second largest export market.

The enforcement of the EVFTA on August 1 has served to help reduce tariff barriers of up to 71% on the total value of Vietnamese exports to the EU, with tax rates poised  to be slashed by 99% over the next decade. Indeed, tariffs on Vietnamese agricultural products will be reduced to 0% during the course of the next decade.

The World Bank estimated that the full implementation of the EVFTA will help Vietnamese exports increase by 12% throughout the 2021 to 2030 period, with fruit exports growth alone anticipated to reach 20%. This will present an array of opportunities for producers and exporters operating in the Mekong Delta to make inroads into the demanding market.

Experts believed that, aside from boosting local exports to the EU, the EVFTA will better protect items against counterfeit goods in the EU market by making use of the provisions set out in the terms of geographical indications (GI).

Nguyen Hai Minh, vice president of the European Chamber of Commerce in Vietnam (Eurocham), said there are currently 39 Vietnamese GIs being protected in the EU, including sea salt and star apples from the Mekong Delta region.

Bui Kim Thuy of the US - ASEAN Business Council, revealed that the quarantine of plants and animals, along with anti-dumping tax and safeguard measures, represent technical barriers faced by local businesses.

In line with the EVFTA, local businesses have been advised to meet stringent food safety standards set by importers from the EU, in addition to other requirements such as origin traceability, quarantine, and food hygiene, in order to penetrate the market and participate deeper in the global food supply chain.