German exports to Vietnam surged.

Exports from the state of Thuringia (Germany) to Vietnam have surged fivefold in the last 10 years.

Gerald Grusser, Director of the Erfurt Chamber of Commerce and Industry. (Photo: Internet).

For tourists, Vietnam has long been a very attractive travel destination. According to the Erfurt Chamber of Commerce and Industry (IHK), the agreement in principle on a new free trade agreement reached between the European Union (EU) and Vietnam is good news, especially for the economy of the state of Thuringia.

Currently, Vietnam is the state's second most important trading partner in the ASEAN region and has approximately 90 million consumers.

IHK Director Gerald Grusser commented: “The free trade agreement between the EU and Vietnam will continue to open doors for Thueringen businesses into a rapidly growing market in Southeast Asia.”

The primary goal of this agreement is to eliminate tariff barriers and facilitate easier access for service businesses. Mr. Grusser stated: “Vietnam is committed to eliminating almost all import tariffs from the EU within 10 years. Conversely, within seven years, all goods from this Southeast Asian country will be imported into the EU duty-free.”

In addition, the two partners also improved key framework conditions for trade, such as protection against product counterfeiting.

Over the past 10 years, Thuringia's exports to Vietnam have increased almost fivefold, reaching nearly 25 million euros in 2014, while imports from Vietnam to the state during the same period even reached 48 million euros. Thuringia primarily supplies Vietnam with machinery, medical equipment, pharmaceuticals, plastics, and glass-based chemical products.

Thus, after Malaysia, Vietnam is the state's second most important trading partner in Southeast Asia. The IHK director believes that with a population of approximately 90 million, this excitingly growing market is an attractive gateway to the entire ASEAN community. Currently, around 90 Thuringian businesses maintain regular business relationships with Vietnam.

Thueringen primarily imports machinery and information technology equipment from Vietnam. According to the state's statistics agency, last year's import value was 25 million Euros.

German exports to Vietnam surged (Figure 1)

Mobile phones and components account for a high export value in Vietnam's export structure to Germany. (Illustrative image: VNA).

In addition, Thueringen imported textiles worth €6.5 million and footwear worth €3.5 million. Plastics, office and data processing equipment, and wooden furniture were also among the imported items.

This is the first free trade agreement that the EU has signed with a developing country, aimed at strengthening mutually beneficial economic relations. For example, Thuringian businesses can participate in bidding for public works projects.

The Vietnamese market, with 90 million consumers, is open in key sectors such as finance, telecommunications, transportation, postal services, environmental protection, and food production, as well as the beverage industry. Mr. Grusser stated that, ideally, the agreement would be finalized and signed by the end of this year, taking effect from 2017.

According to VOV.VN