EVIPA ratification required to realize potential in Vietnam-EU economic relations

Vietnam sees the EU-Vietnam Free Trade Agreement (EVFTA) and the EU-Vietnam Investment Protection Agreement (EVIPA) as "two wings of a bird", without one, it would be hard to ensure the lawful rights of Vietnamese and European investors.

Chairman of the National Assembly Vuong Dinh Hue at the meeting. Photos: Thanh Chung

“Once the EVIPA is ratified at every parliament of EU member, we could really see the two agreements as an economic highway that connects Vietnam and Europe.”

Chairman of the National Assembly (NA) Vuong Dinh Hue stressed the view at a Vietnam-Austria Business Forum held on September 6, which drew the participation of more than 30 business leaders from over 20 Austrian and Vietnamese corporations.

While the EVFTA has become effective for over a year, the EVIPA is still pending approval from all EU members, with six out of 27 have done so as of present.

“Vietnam seeks supports from the Austrian Chamber of Commerce and businesses to continue pushing for the approval of the EVIPA as soon as possible,” Hue said.

The NA Chairman also briefed delegates on Vietnam’s economic performance, which had been among the fastest-growing economies in 2020 with an expansion rate of 2.91%.

For the first six months of the year, Vietnam has maintained the growth momentum with a 5.64% growth rate and trade turnover of US$429 billion, or an increase of 27.2% year-on-year.

Strong FDI inflows helped Vietnam being named among the world’s top 20 FDI recipient economies in 2020 with an inflow of $16 billion by the UN Conference on Trade and Development (UNCTAD).

Overview of the meeting.

“Vietnam aims to attract high-quality FDI projects that use modern and environmentally-friendly technologies,” Hue said, stressing those in fields of hi-tech, innovation, R&D are of priority.

Austria currently has 37 investment projects in Vietnam with a total registered capital of $150 million, mainly in manufacturing and processing, science, and technology.

Meanwhile, the European country is also among Vietnam’s five largest export markets in the EU, with a trade turnover reaching  $3.2 billion in 2020 despite the pandemic, a surge of 13-fold against 2010.

“The figures, however, remained modest compared to the cooperation potential between the two countries,” Hue added.

The NA Chairman expected Austria to become a gateway for Vietnam to access the European market, in return, Vietnam could help Austrian companies penetrate the ASEAN market of 650 million people and even members in the CPTPP with 800 million consumers.

Hue also called for Austrian companies to support Vietnam to gain access to sources of vaccine supplies and medical equipment as the country is looking to contain the current Covid-19 outbreak.

Addressing Austrian companies taking part in the event, which are from the finance-banking, healthcare, consultation, transportation, energy, and aviation, Vice President of Austrian Chamber of Commerce Richard Schenz noted Austria is looking for new business opportunities in Vietnam to avoid risks of disruption in global supply chains, for which this forum would be the platform to strengthen cooperation between businesses of the two countries.

He also added that the Austrian Chamber of Commerce has set up a representative office in Ho Chi Minh City to cooperate with the city in projects of smart city, infrastructure development, renewables, and transportation.

Chairman Hue said Vietnam is committed to maintaining a favorable business environment and working towards meeting OECD business practice standards with greater transparency and predictability.