At the end of 2019, the fishery sector targeted export turnover into the EU market of US$ 2 billion with the expectation that the EVFTA would be soon implemented. However, the sudden outbreak of Covid-19 has caused consumption to decline and the EVFTA, which has been approved, will take time to materialize. Therefore, the fishery sector is forced to move this target to 2021 and has specific plans to develop the EU market in accordance with the capacity of enterprises in the sector.

According to Mr. Truong Dinh Hoe – General Secretary of Vietnam Association of Seafood Exporters and Producers(VASEP), this time along with the excitement of the National Assembly’s approving the EVFTA, enterprises in the fishery sector are actively improving necessary standards to take full advantage of this FTA when EVFTA becomes effective.

Despite the decline in exports due to more or less impact by the epidemic in the last time, most fishery enterprises still adhere to quality standards from farming areas, food safety certification to logistics infrastructure to meet market requirements because not only in the EU but also in other countries, the standards set for fishery products are always very strict.

For example, in the field of tra catfish, Viet Uc Group, Nam Viet One-member Co., Ltd., Vinh Hoan Joint Stock Company and Loc Kim Chi Development Co., Ltd have invested in tra catfish farming areas under the three-tier co-operation plan for production of high-quality tra fish breeds in the Mekong Delta initiated by An Giang province. Currently, these enterprises have planned high-tech farming areas meeting strict criteria to provide the best tra catfish products for export regardless of the strong impacts on business from the epidemic.

Vietnam’s timber export to the EU currently accounts for about 10% of the total annual export turnover. According to experts, when EVFTA officially takes effect from 01 August, it will bring many advantages for timber export, helping the sector gain more support to speed up post pandemic. However, if other sectors benefit mainly from tariffs, timber enterprises will benefit mainly from import because currently exporting timber to the EU is almost enjoying a 0% tax rate.

Mr. Nguyen Chanh Phuong, Vice Chairman of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA) – analyzed and estimated that Vietnam is importing about 1 million cubic meters of timber material (approximately US$ 270 million) from EU countries every year. When the import tax rate is 0%, it will create more advantages for timber enterprises to strongly shift to the EU market to import quality timber products, thereby increasing the value and meeting the requirements of the EVFTA’s rules of origin.

As a company successful in exporting to the EU, Mr. Tran Quoc Manh – Chairman of the Board of Directors of Saigon Trade and Production Development Corporation (SADACO) said that not only SADACO but also many other timber enterprises in Ho Chi Minh City have prepared from raw materials, standard systems, international certification, etc. and updated all information about the EVFTA deployment process, so they are confident meet the contents of the EVFTA. However, in order to maximize the effectiveness of EVFTA, Mr. Manh proposes the involvement of ministries, associations and enterprises.

According to many comments right from the first days of negotiation, the textile and garment sector will get the most advantages when the EVFTA comes into effect because textile and garment sector are subject to the highest tariffs with a weighted average tax rate of 9%. With the EVFTA becoming effective, the tax rate will be reduced to 0% within 7 years and gives the textile and garment sector a chance to increase their market share in the market with textile and garment import of US$ 250 billion each year.

Mr. Pham Van Viet – Chairman of the BOD of Viet Thang Jean Company Limited shared that the company is currently exporting mainly to the EU with annual turnover of US$ 8 million, of which Jean products are subject to a tax rate of up to 16%.

Although advantages are very clear, this sector must meet the rules of origin to benefit. Meanwhile, Vietnam’s textile and garment sector has been dependent on raw materials from China, so many enterprises have made preparations for workshops, raw materials, etc., to be ready to “penetrate” the EU market immediately after the agreement is effective.

Mr. Tran Nhu Tung – Vice Chairman of the BOD of hanh Cong Textile Garment Investment Trading Joint Stock Company shared: The company has built a fabric dyeing factory in Hoa Phu Industrial Zone, Vinh Long Province with more than 1,500 employees. It is estimated that each year this factory produces enough fabric for Thanh Cong’s production needs. In addition, the Company is also expected to open another factory in the Western region to be able to meet raw material needs for production.

According to a study by the Ministry of Planning and Investment, the EVFTA will help Vietnam’s export turnover to the EU increase by about 20% in 2020 and 43% in 2025. And according to the EVFTA’s commitment, tariffs imposed on products such as fruits, processed fruits and vegetables, other fruit juices, etc. will basically be removed when the agreement comes into effect.

Along with the great benefits of tariffs, the EVFTA also poses significant challenges for agricultural products penetrating the EU. Specifically, Vietnamese enterprises will have to meet the standards of food safety and hygiene, origin traceability, obtain environmental and social certificates, etc. Aware of this issue, many large enterprises in the sector have thoroughly prepared from farming areas to meet EU’s strict technical standards and meet global certificates, e.g Vina T&T.

However, according to experts, in the context that the Covid-19 epidemic hasn’t been controlled in the world as currently, only high-tech enterprises with planting areas will be the pioneering ones to benefit when exporting to the EU. Therefore, in order for the enterprise community, especially small and medium-sized enterprises to take full advantage of the benefits brought by this Agreement, the support of state agencies in propaganda and trade promotion for the enterprises to catch information from the market is very necessary.