Vietnam – EU Partnership and Cooperation Agreement: Opportunities from Major Customers

The Vietnamese Ministry of Foreign Affairs and the European Union (EU) Delegation in Vietnam recently organised a conference to introduce the Vietnam – EU Strategic Dialogue Facility in the implementation of the Vietnam – EU Partnership and Cooperation Agreement (PCA). On the sidelines of the meeting, Vietnam Business Forum had an interview with Ambassador Franz Jessen, Head of the EU Delegation in Vietnam, about the importance of PCA to trade and investment between Vietnam and the EU. Anh Phuong reports.

Globalisation is making strong moves. What do you think about current Vietnam – EU trade and investment ties?

Currently, Vietnam – EU relations are developing very nicely. The EU is now a leading partner of Vietnam in various fields from politics, diplomacy, trade and investment cooperation development, science and technology to response to global challenges. The EU is also currently the largest non-refundable donor, the second largest trade partner, and the largest export market of Vietnam. Vietnamese and EU leaders always stress the importance of Vietnam – EU relationship and want to further strengthen this relationship to be commensurate with potentials and positions of both sides. Recently, the first visit of European Council President Herman Van Rompuy to Vietnam in December 2012 and the official EU visit of CPV General Secretary Nguyen Phu Trong to Belgium, the Netherlands, England and Italy in January 2013 marked a new step of development in the bilateral relationship and vividly expressed broader cooperation ties between Vietnam and the EU and EU member states as well.

Vietnam – EU trade ties have also made impressive growth. In the context of economic crisis, the two-way trade reached US$29.09 billion in 2012, representing a nearly 20 percent growth over 2011. Only in the first two months of 2013, the Vietnam – EU trade turnover grossed over US$5 billion, up 28 percent year on year. The bilateral free trade agreement (FTA) that the two sides are negotiating and expecting to sign in 2014 will certainly boost up the two-way trade.

As regards investment, EU member states are leading investors in Vietnam. As of end-March 2013, 22 out of 27 EU countries invested in Vietnam with 1,299 valid projects and a total registered capital of US$17 billion.

What is your onion about the Vietnam – EU PCA?

The official signing of the Vietnam – EU PCA in June 2012 provided a new regulatory framework that illustrates the rapid-developing and dynamic relationship between Vietnam and the EU, marked the development in nature of this relationship on the basis of equal partnership and comprehensive cooperation for mutual benefits. In addition, PCA not only adjusts the Vietnam – EU bilateral cooperation relationship in economy, trade, education, training, science and technology, agriculture, health and tourism, etc. but also embraces cooperation in regional and international cooperation forums, cooperation in response to global challenges such as climate change, environment, natural disasters, energy security, non-proliferation of mass destruction weapons, terrorism and organised crime.

Mr Vu Khoan, former Deputy Prime Minister

Needless to say, Vietnam – EU bilateral relations have been built on a really solid platform. The two sides have comprehensive cooperation in trade, investment, development aid, culture, education, training, science, technology, society and environment. This strong relationship is based on important legal documents, especially the 1995 Framework, the Overall Scheme and Action Plan 2005, and PCA 2012. Typically, the growth of two-way trade and investment is very high. However, there are some obstacles and problems in bilateral relations, such as protectionist trends, trade disputes, the EU rejection to grant the market status for Vietnam, or the lack of transparency in Vietnam. As for Vietnam, stepping up the negotiations is important but getting prepared to realise commitments to grasp opportunities and respond to emerging challenges is more important.

As known, the two sides are now stepping up internal procedures for the ratification this year. In addition, the PCA implementation is also of very important significance and helps promote Vietnam – EU bilateral ties. While waiting for official approval, the two sides have agreed on the early PCA implementation in priority areas. The early PCA implementation in the 2011 – 2012 phase produced nice results and the two sides now working to agree on the early PCA implementation in the 2013 – 2014 stage. Besides, the fourth phase of the Multilateral Trade Assistance Project (MUTRAP) of the EU with a total value of EUR15 million will spare a part to support the deployment of economic, trade and investment activities mentioned in PCA. Similarly, the Justice Partnership Programme with a value of over EUR18 million will also have support activities for the PCA implementation in law and justice fields.

EU also appreciated Vietnam’s expressed desire for assuming more international responsibility like becoming a member of the UN Security Council and the UN Human Rights Council. This is a topic the EU interests, monitors and dialogues. The EU also wants to continue cooperation with Vietnam, as ASEAN – EU relations coordinator in the next three years. Hopefully, the fourth round of negotiations, expected to be held in July 2014, will help further life up the bilateral relations.

What will the EU Delegation in Vietnam support Vietnam in the coming time?

In this conference, the EU will officially announce to launch the Vietnam – EU Strategic Dialogue Facility and activities to be done in 2013. Accordingly, the EU Delegation in Vietnam will fund EUR2.9 million in 36 months (from February 2013 to February 2016). Major activities include policy research, technical assistance, conferencing, training, communication, image building, etc.

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