EVFTA brings chances and challenges to local agricultural production

Monday, February 17, 2020  10:18

Rice is loaded at Saigon Port in HCM City. With the ratification of the EU-Việt Nam Free Trade Agreement, Việt Nam can export 80,000 tonnes of rice a year with a zero tax rate to the EU. VNA/VNS Photo Đình Huệ

HÀ NỘI — The new trade agreement between Việt Nam and the European Union opens many doors for agriculture, according to experts.

Nguyễn Đỗ Anh Tuấn, director of the Department of International Cooperation, Ministry of Agriculture and Rural Development said the newly-ratified EU-Vietnam Free Trade Agreement (EVFTA) offers plenty of opportunities.

He said as the EU imports about US$150 billion agricultural products each year so the EVFTA would open up a potential market for the local export agricultural products.

Tuấn told a discussion hosted by the Government Electronic Portal on the EVFTA in Hà Nội yesterday that: “There is room for Vietnamese agricultural products.”

Agreeing with Tuấn, chairman of Vietnam Chamber of Commerce and Industry (VCCI) Vũ Tiến Lộc said: “The EU is a large market with the world's leading purchasing powers and the EVFTA Agreement marks a new phase for Việt Nam with favourable conditions for the local enterprises, including the agriculture firms, to increase exports.”

However, Lương Hoàng Thái, director general of the Multilateral Trade Policy Department, under the Ministry of Trade and Industry raised a number of challenges for the industry as the strict conditions from the EU market such as the regulation of origin, quality and labour relating to the agriculture production.

Thái added: “Local livestock industry would face increasing competitive pressure from imported products from the EU.”

He thought the small scale of the husbandry would make farmers and local livestock cooperatives fall behind imported products from EU. 

As frozen pork meat would be duty-free after seven years, dairy products after five years, and processed food after seven years, and chicken after 10 years, Thái said: “Việt Nam should take time to improve the local livestock.”

Currently the EU’s livestock products exported to Vietnam are subject to tariffs of 10-40 per cent. The reduction of import tariff on livestock products from the EU will improve their penetration of the Vietnamese market and pose significant competition to domestic products.

Thái added the country should apply further modern technology to ensure clean production as well as avoid child labour in the production to improve agriculture production to better grasp the chance from the EVFTA.