Over 11 billion USD of Vietnamese goods take advantage of tax incentives to enter Europe

Rice and seafood lead in FTA utilization

On November 27, in Ho Chi Minh City, the Ministry of Industry and Trade organized the Vietnam - EU Trade Forum. Ms. Do Thi Thu Huong, Deputy Director of the Import-Export Department (Ministry of Industry and Trade), said: As of August 1, 2023, the Free Trade Agreement between Vietnam and the European Union (EU), abbreviated as EVFTA, has been in effect for 3 years. One of the results that can be measured in numbers is that the proportion of Vietnamese goods enjoying tariff preferences increases every year. Specifically, in the first year, about 20% of Vietnamese goods enjoyed tariffs, by 2022 this proportion increased to about 25.9% and by 2023 it was 35%.

Hơn 11 tỉ USD hàng hóa Việt Nam tận dụng được EVFTA - Ảnh 1. — Rice and seafood lead the list of products taking advantage of tariff incentives from EVFTA

In absolute terms, in the past 9 months of 2023, more than 11 billion USD worth of exported goods enjoyed tariff incentives, an increase of 30% over the same period in 2022. The EU is one of the two partners with the largest export turnover for which we grant CO to enjoy tax incentives under FTAs. The proportion of goods enjoying tariff incentives in the EU market accounts for 18% of the total turnover of goods enjoying incentives under FTAs.

According to statistics from the General Department of Customs, by the end of the third quarter of 2023, the import-export turnover between Vietnam and the EU reached 15.1 billion USD. One of the important reasons for making good use of tariff incentives is that businesses are increasingly accessing more information and applying them better. In addition, by 2023, other tariff incentives will gradually expire and only incentives under EVFTA will remain, so businesses will switch to this area.

In terms of product groups, rice is the product that best utilizes EVFTA with a rate of 100%, followed by seafood with more than 90%, then food and confectionery products... "Vietnam's opportunities are still very large in the EU market because this is the world's largest agricultural and aquatic product import market. But the challenges are not small, especially when products must meet standards related to green growth trends and sustainable development, traceability, food safety, and anti-deforestation," Ms. Huong warned.

Risk of environmental tax if slow to convert

On the other hand, the biggest challenge for Vietnamese goods in the coming time is to meet EU environmental protection standards and regulations. Ms. Lin Goethals, Director of the European Institute for Asian Studies (EIAS), said: Environmental pollution and climate change have caused the global economy to lose an equivalent of 3.2% of GDP. That is why European countries are promoting the European Green Deal (EGD) program, thereby strengthening environmental protection activities.

In the future, the industries that will be most affected are steel, aluminum, and garments. These are industries that not only need to reduce emissions but may also have to pay environmental fees to be able to bring goods into the EU. Of course, European import partners also have the responsibility to support Vietnamese manufacturers in meeting the standards. However, the readiness of Vietnamese suppliers is extremely important. The Vietnamese government also needs good financial resources to support businesses, especially small and medium enterprises.

Mr. Dang Bui Khue, Director of Bureau Veritas Vietnam, a unit operating in the field of consulting and supporting businesses to implement environmental requirements, said: From October 2024, the EU will begin implementing the carbon border adjustment mechanism and will have a transition year of 2025, until 2026 when it will be officially applied. Therefore, if businesses do not act quickly and proactively, they will face many difficulties in bringing goods into the EU in the near future or will be subject to very high environmental taxes.

Source link