Vietnam's exports in the second half of 2020 with much expectation from EVFTA

Trade turnover is expected to grow thanks to taking advantage of the EVFTA, which is expected to come into effect in early August.

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EVFTA will be a great opportunity for year-end export

In the context of the global economic downturn due to the negative impact of the Covid-19 pandemic, Vietnam's import and export of goods in the first half of 2020 is estimated to decrease by 2.1% over the same period last year. 2019, reaching USD 238.39 billion. In particular, export turnover recorded the first decline since the global economic and financial crisis in 2008/2009, with a decrease of 1.1%, estimated at USD 121.21 billion; Similarly, import turnover decreased by 3% compared to the same period in 2019, estimated at USD 117.17 billion.

Stating difficulties in import and export in the first half of 2020, a representative of the Vietnam Association of Wood and Forest Products said that up to now, over 80% of buyers exporting to the US market have announced to stop buying and canceling products. New order status queue. 81% of enterprises exporting to the EU market have received notice of canceling orders and extending orders. The markets of Japan, Korea and China also dropped by 60-80%.

Notably, with the complicated evolution of the disease, currently customers do not come to the factory to sample. Therefore, Vietnamese timber enterprises have not signed new orders for the 2020-2021 season. This entails many factories with the potential to close and stop operating in the near future, hundreds of thousands of workers face. with unemployment, no job security and social security for workers in the long run.

According to the Ministry of Industry and Trade of Vietnam, despite its success in the fight against Covid-19, the attraction of investment and export promotion depends largely on external factors. Meanwhile, the Covid-19 epidemic in the world is still having complicated developments and seriously affecting the global economy, the recovery process will take a long time.

From the above analysis, the Ministry of Industry and Trade of Vietnam said that in the coming months, Vietnam's import and export will likely continue to recover, but the turnover will still decrease compared to the same period in 2019.

Many experts also shared that, the situation of trade in the second half of Vietnam still depends heavily on the situation of Covid-19 epidemic being controlled worldwide, as well as taking advantage of the trade agreements. Free Trade Agreement (FTA), including the Vietnam-EU Free Trade Agreement (EVFTA), is expected to take effect from August 1, 2020.

EVFTA will be a great opportunity for year-end export

Besides difficulties, the Ministry of Industry and Trade of Vietnam also pointed out many export supportive factors in the second half of the year. For example, in recent years, the supply chain, the import-export market were interrupted by the impact of Covid-19 epidemic. But from mid-April to now, the situation has gradually improved, European countries gradually reopened to the economy.

Specifically, many countries have launched large-scale stimulus packages, increased fiscal spending to cope with diseases, maintained essential economic activities and supported workers. In the US, as of the end of May, all 50 states in the US were partially reopened after 2 months of closure to implement restrictive measures against the Covid-19 epidemic.

In addition, Vietnam's disease control is highly appreciated by the international community, which is considered an important motivation to attract more foreign investment into Vietnam after the pandemic.

Notably, the EVFTA Agreement is expected to come into effect from August 2020 creating a new motivation for exports in the last months of 2020 and the coming years. Vietnam's approval of EVFTA at this time will provide an impetus for the domestic economic recovery after the Covid-19 pandemic.

Mr. Tran Thanh Hai, Deputy Director of the Import-Export Department (under the Ministry of Industry and Trade of Vietnam) analyzed that, with the EVFTA Agreement, Vietnam has a great strength when the Asian region, the EU only signed a cooperation agreement with South Korea. Quoc, Singapore, however, these two countries do not have the same production structure as Vietnam. Therefore, in the long term, the Agreement will create a stable advantage for Vietnam's exports.

“As committed in EVFTA, the EU will give Vietnam a quota of 80,000 tons of rice (0% tax) on milled rice and fragrant rice, and eliminate tax on broken rice in 5 years. This is an opportunity to boost rice exports to the EU in the future, because this region is consuming about 2.5 million tons of rice a year, "Hai said.

For other agricultural and aquatic products, Mr. Nguyen Quoc Toan, Director of the Department of Agricultural Product Processing and Market Development (under the Ministry of Agriculture and Rural Development of Vietnam), said that the EU committed to open strongly. for Vietnamese fruits and vegetables in EVFTA, specifically eliminating 94% of the 547 tariff lines for vegetables and fruit products, including many Vietnamese products that have an advantage right after the Agreement comes into effect. However, because the EU is a high-level market, businesses wishing to enjoy preferential tariff treatment need to pay close attention to technical barriers in this market.

“In order to make good use of opportunities, Vietnam's agriculture and fisheries must overcome strict technical barriers and standards ... Since 2016, the agricultural sector has focused on issues of standards, quality and models. packaging ... to deal not only with EVFTA but also many other FTAs. Because non-standardization, it is not possible to integrate sustainably, ”Toan said.

Regarding the export of goods in the second half of 2020, trade expert Pham Tat Thang said that if the EU could control the Covid-19 epidemic in the second quarter to start the third and fourth quarters, to restore production activities. Export, the EVFTA Agreement will be the route and wide door to bring goods to the EU market.

“The EU market will need to import goods such as textiles, footwear, furniture, especially phones, electronic components, etc. These are all products with a large and key export turnover of Vietnam. By making good use of the EVFTA, Vietnam can still compensate for the previous trade loss caused by the Covid-19 epidemic, ”Mr. Thang said.

Phaata (According to Nguyen Quynh / VOV.VN)