Traditionally Korea had been pursuing the trade policy focusing on GATT/WTO multilateral system so the country was reluctant to stimulate FTA bilateral trade agreements until 1990s. In the early 2000, Korea has shifted its international economic policy towards bilateral trade agreement through FTAs...
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Kampanat Pensupar1*, Itthipong Mahathanaseth2, Panan Nurancha 3
1 Center for Applied Economic Research, Faculty of Economics, Kasetsart University, Bangkok, Thailand 10900; E-mail address: fecoknp@ku.ac.th
2 Department of Agricultural Economics and Resources, Faculty of Economics, Kasetsart...
The EU - Vietnam Free Trade Agreement (EVFTA) has provided the Vietnamese agricultural sector with favourable opportunities for promoting export growth, while also posing challenges in terms of the implementation of the agreement.
However, these challenges are also an important lever, helping the country's agricultural sector be more mature in its integration process on the basis of promoting restructuring via improving product quality and deep processing towards an organic and modern agricultural system.
Promoting the processing industry
The EVFTA is the free trade agreement (FTA) with the highest level of commitments for Vietnam among all signed FTAs thus far, with more than 99% of import tariff lines between the two sides being eliminated across a 7-10-year roadmap. In particular, tax rates applied on many agricultural products that Vietnam has advantages in producing and exporting, such as rice, seafood, coffee and cocoa, will be cut immediately or in a short time.
Currently, the EU's importation of agricultural, forestry and fishery products accounts for about 8.4% of the total. Therefore, Vietnam's agro-forestry and aquatic products still have plenty of room for export growth in this market.
However, Europe prefers processed products, so in order to increase the quantity of goods as well as export turnover, the agricultural sector needs to focus on strongly developing the processing industry in the coming time. Specifically, Vietnam's tropical fruit products are very welcome in Europe but the geographical distance makes it difficult to transport and preserve fresh produce.
Therefore, the development of post-harvest preservation and processing technologies is the "golden key" to help Vietnamese fruits penetrate the EU market, especially in the context of the tax rate of 85.6% of processed fruit and vegetable products from Vietnam to the EU having been reduced to 0% once EVFTA came into effect.
Read more here.