Workers produce mechanical components at the factory of the Japanese-invested Nidec Tosok Vietnam Co. Ltd in Tan Thuan Export Processing Zone, Ho Chi Minh City (Photo: VNA) Hanoi (VNA) – The EU-Vietnam FreeTrade Agreement (EVFTA) will create opportunities for Japanese companies tocontinue expanding operations in Vietnam and boost exports to the EU, accordingto chief representative of the Japan External Trade Organisation (JETRO) inHanoi Takeo Nakajima.
In a recent interview granted to the Cong Thuong(Industry & Trade) newspaper, the official said exports to the EU currentlyaccount for only 2.8 percent of overseas shipments by Japanese businesses inVietnam, and another 65 percent are destined for the Japanese and ASEANmarkets.
Therefore, when the EVFTA, recently ratified bythe European Parliament, takes effect, it will create a big push for Japanesefirms in Vietnam as tariffs on almost all commodities will be slashed to zeropercent, Nakajima said, noting that many Vietnamese products will have morechances to compete in the EU market.
Many Japanese businesses will become interestedin and orient their export to the EU in the time ahead since they look forwardsto lower tariffs on exports to such a large market and on import of materials,components and spare parts from Europe, according to him.
A JETRO survey shows that 50.4 percent ofJapanese enterprises in Vietnam have made use of FTAs and investment protectionagreements, and the rate is likely to increase.
However, he pointed out that although Vietnamhas signed various FTAs, the adaptation of domestic laws to those deals isstill relatively slow, so businesses are unable fully capitalise on thoseagreements.
Nakajima said to help companies optimiseadvantages created by the EVFTA or other FTAs, Vietnam should fine-tunedomestic laws soon. Its Government also needs to assign a single agencyresponsible for implementing the pacts because the involvement of many partiesmay lead to overlapping information, thus confusing businesses.
Up to 35.6 percent of Japanese companies inVietnam haven’t made use of FTAs, and 10 percent are considering whether or notthey should do that, he noted, highlighting the need to increase theintroduction of FTAs to them and listen to their opinions so as to support themin taking advantage of the deals./.
VNA
