Written by Martin Russell (4th edition, updated on 14.11.2019),
The European Commission has described the free trade and investment protection agreements (FTA/IPA) signed with Vietnam as the most ambitious deals of their type ever concluded by the EU and a developing country. Not only will they eliminate over 99 % of customs duties on goods, they will also open up Vietnamese markets to European service providers and investors.
According to European Commission figures, the agreements will boost trade in both directions, with EU exports set to rise by nearly 30 %. Vietnam is the second south-east Asian country after Singapore to sign trade and investment agreements with the EU, bringing the long-term goal of a region-to-region EU-ASEAN trade deal a step closer.
In view of the human rights situation in Vietnam, opinions are divided on whether the agreements should be ratified. Critics argue that the EU should not approve the agreements until the situation improves. On the other hand, defenders point out that the FTA/IPA include commitments to stronger human rights (such as allowing independent trade unions); they also insist that the EU can best help to bring about improvements by engaging with Vietnam .
Following the same approach as for Singapore, the single text originally agreed in 2015 with Vietnam has been split into two parts, an FTA covering exclusive EU competences and an IPA that includes competences that are shared with EU Member States. The European Parliament is set to vote in February 2020; if it gives its consent, the two agreements will then have to be ratified by Vietnam and (for the IPA) the EU Member States before entering into force.
|Free trade agreement between the European Union and the Socialist Republic of Viet Nam; Investment Protection Agreement between the European Union and its Member States, of the one part, and the Socialist Republic of Viet Nam, of the other part|
|Committee responsible:||International Trade (INTA)||FTA: 2018/0356(NLE)
|Rapporteur:||Jan Zahradil (ECR, Czech Republic)|
Read the complete briefing on ‘EU-Vietnam trade and investment agreements‘ on the Think Tank pages of the European Parliament.