Exporters cannot be ignored

In the period from August 2020 to the end of July 2022, the total export turnover from Vietnam to the EU market reached 83.4 billion USD, an average increase of 41.7 billion USD/year, higher than 24 % of annual average export turnover in the period 2016 - 2019.

In the first 11 months of 2022, the export turnover to the EU market reached 43.5 billion USD, up 21% over the same period. Many export items of Vietnam have recorded impressive growth such as iron and steel increased by 739%; cameras, camcorders and components increased by 260%; machinery and equipment increased by 82.3%... These impressive numbers are the results that Vietnam has achieved after two years of the EU-Vietnam Free Trade Agreement (EVFTA) taking effect.

Exporting enterprises need to take advantage of the opportunities of EVFTA, grasp the regulations on origin, and improve the quality of exported products.

The opportunity to develop export growth in general and to the EU market in particular is not lacking for Vietnamese enterprises, but most observers recognize that the challenges for the Vietnamese economy mainly stem from the influence of Vietnam's economy. In the global economy, when the partner markets of Vietnam mostly face difficulties, it is not small. The Covid-19 pandemic, the war in Ukraine, the escalating energy prices, high inflation, as well as the tightening of monetary policy by central banks globally are causing many major economies to suffer, including There is the European Union (EU) and the US and this affects overall export growth.

Mr. Tran Quoc Manh - Chairman of the Board of Directors of Saigon Trade Production Development Joint Stock Company (Sadaco) - said: The barriers from EVFTA to Vietnam's small and medium enterprises are not small. In addition to the main industries of textiles and garments, leather and footwear, etc., products related to Vietnam's forest products and furniture need to meet conditions such as voluntary partnership agreements in order to increase export growth; Forest and forestry governance, Environmental - Social - Governance (ESG) standards and CO2 emissions…

Or most recently, EU member states announced that they would implement the Carbon Border Adjustment Mechanism (CBAM), which levies a carbon tax on all goods exported to this market based on the intensity of carbon emissions. greenhouse gas in the production process in the host country right in 2023. That means, exporters need to have a solution to switch to "net zero" if they do not want to be excluded from the "game".

Exporting enterprises need to be proactive and ready to respond

According to Ms. Nguyen Thi Thu Trang - Director of the Center for WTO and Integration (under the Vietnam Chamber of Commerce and Industry - VCCI), besides meeting the EU's import conditions, the issue of tariffs is also a problem. Enterprises need to find out carefully in 2023. For many years now, the EU has been maintaining the Generalized Tariff Preferences (GSP) mechanism for developing and least-developed countries, including Vietnam. According to EU regulations on GSP when there is a free trade agreement (FTA), Vietnam will continue to enjoy the GSP mechanism in parallel with the EVFTA Agreement for a period of 02 years from the date of entry into force of the EVFTA, that is, until the end of December 31, 2022. However, from January 1, 2023, the GSP preferential tariff regime will automatically end, and businesses will apply the preferential tariff regime under the EVFTA.

However, in terms of tax rates, we are still allowed to choose. That is, within the next 5 years, we are allowed to choose which tax rate is more preferential, but the mechanism of rules of origin is according to the EVFTA Agreement. Therefore, exporters need to understand clearly to take advantage of the opportunities of the EVFTA such as grasping the regulations on origin, as well as monitoring the committed roadmap of the products.

In addition, the problem of labor standards of the EU market in the EVFTA agreement also makes it difficult for many businesses to adapt. Workers are at risk of losing their jobs due to low skill levels, but this is also an opportunity for businesses to change to have the opportunity to develop and enjoy the terms of the EVFTA. The opportunity for Vietnamese workers is to transfer training programs, training models and order with vocational schools in the region, transfer training technology.

"In order to implement the EVFTA more effectively in the coming time, the State needs to support and accompany businesses to take advantage of demand when EU countries cut production for some heavy industrial products and chemicals. fertilizer, steel, food to boost the export of these items The Government should have policies to support businesses more in terms of trade information of the EU market through the development of a market information system. markets, organize trade promotion programs, strengthen market analysis, forecast and research, issue policies to facilitate businesses, thereby supporting businesses to participate directly. , supply chain efficiency, it is necessary to strengthen the warning of regulations on barriers and problems arising for export goods," said Ms. Trang.