Supporting small and medium enterprises to effectively implement the EVFTA Agreement

On the morning of June 5, the Ministry of Industry and Trade coordinated with the Vietnam Association of Small and Medium Enterprises to organize an online conference on “Supporting SMEs to take advantage of opportunities and effectively implement EVFTA” in Hanoi and 62 provinces and cities. The conference was co-chaired by Mr. Tran Tuan Anh - Member of the Party Central Committee, Minister of Industry and Trade and Chairman of the Vietnam Association of Small and Medium Enterprises Nguyen Van Than.

Comrade Le Hong Vinh - Member of the Provincial Party Committee, Permanent Vice Chairman of the Provincial People's Committee and Deputy Director of the Department of Industry and Trade Cao Minh Tu chaired at Nghe An bridgehead.

Make the most of the opportunity

Speaking at the opening of the conference, Minister of Industry and Trade Tran Tuan Anh said that Vietnam's integration strategy has gone through many stages and has made many important contributions to the country's development. On March 30, 2020, the European Council approved the EVFTA. According to the plan, the National Assembly will vote to approve the Resolution ratifying the EVFTA on June 8, 2020.

EVFTA has a wide range of commitments and the highest level of commitment of Vietnam to date. With this agreement, Vietnam becomes the only developing country in the world and the second country in ASEAN to have a free trade agreement with the EU - the leading economic community in the world.

EVFTA is one of the most ambitious agreements for both Vietnam and the EU. In photo: Minister of Industry and Trade Tran Tuan Anh at the signing ceremony of the Vietnam - EU Free Trade Agreement (EVFTA) in June 2019. Photo courtesy

The EU is the world's second largest import market and Vietnam's second largest export market (after the US). Through the Agreement, Vietnam can access a potential market with a population of more than 500 million people and a GDP of about 15,000 billion USD (accounting for 22% of global GDP). Organizing the conference will help Vietnamese small and medium enterprises (SMEs) better understand the contents of the EVFTA, the aspects that businesses can exploit and benefit from the agreement, as well as issues to note in order to have strategies, plans and preparations ready for business development in the new market conditions and trade context with EVFTA.

“Central agencies and local authorities must be responsible for thoroughly understanding and guiding businesses to effectively participate in the implementation of the Agreement, especially supporting small and medium enterprises - the heart of the country's economy, to be able to take full advantage of opportunities as well as minimize challenges encountered in the process of implementing the Agreement,” the Minister of Industry and Trade emphasized.

Early development of support plan for small and medium enterprises

There are 5 topics that the Conference focused on discussing, which are: Strategic benefits and points to note for SMEs to effectively implement EVFTA; Potential industries, products, and orientations to promote exports to the EU market; The role of local authorities at all levels in supporting local SMEs to thoroughly understand and effectively implement EVFTA; Orientation of trade promotion activities to support SMEs to effectively exploit opportunities brought by EVFTA; Sharing of SMEs on taking advantage of opportunities and preparing for challenges from EVFTA.

Comrade Le Hong Vinh - Member of the Provincial Party Committee, Permanent Vice Chairman of the Provincial People's Committee and Deputy Director of the Department of Industry and Trade Cao Minh Tu chaired at Nghe An bridgehead.Photo: Thu Huyen

At the conference, delegates said that with strong commitments to open the market, EVFTA is expected to help Vietnam's export turnover to the EU grow strongly, focusing on a number of industries such as agricultural products; processing and manufacturing industries; and services. In the immediate future, with the implementation of EVFTA, Vietnamese enterprises will have the opportunity to access new supply chains to replace traditional supply chains that have been disrupted or stagnant due to the recent Covid-19 pandemic. In addition, the export markets of Vietnamese enterprises also have the opportunity to expand and diversify, reducing dependence on a certain group of markets.

Panorama of the conference at Nghe An bridgehead. Photo: Thu Huyen

For Nghe An, in recent years, the export turnover of goods between Nghe An enterprises and the European market has grown but not significantly, averaging only about 50 million USD/year, accounting for 6 - 7% of the province's total export turnover. Main export items: Textiles (accounting for about 60%); processed fruits and fruit juices (30%); other items such as: tea, pepper, plastic additives, pine essential oil, tiles... accounting for about 10% are exported to the markets of 26/27 countries in the EU bloc, mainly the UK, Germany, France.

Import turnover from Europe reaches 50 - 60 million USD/year, mainly on the following items: machinery, equipment; cargo ships; textile and footwear materials;...

Immediately after the EVFTA takes effect, the EU commits to eliminating import duties on about 85.6% of tariff lines, equivalent to 70.3% of Vietnam's export turnover to the EU. In the photo: Garment production at an industrial cluster in Dien Chau, Nghe An. Photo: Thu Huyen

To support small and medium-sized enterprises in effectively implementing the EVFTA, Nghe An hopes that the Ministry of Industry and Trade and relevant ministries and branches will soon issue documents guiding the implementation and enforcement when the Agreement comes into effect to help businesses grasp information and develop plans to promote the export of goods to the EU market.

Pay attention to promoting propaganda activities and disseminating information about the EVFTA Agreement, focusing on organizing training courses and specialized training for businesses to help them improve their understanding and take the initiative in producing goods that meet the rules of origin, effectively taking advantage of incentives from the Agreement. At the same time, strengthen information work on export markets, especially the EU market; promote export promotion activities, have policies to support small and medium enterprises exporting goods to the EU market...