Up to 99 per cent of Vietnamese products exported to the EU would be free of tariffs once the EU-Vietnam Free Trade Agreement (EVFTA) goes into effect. Vietnam’s exports to the bloc could rise by as much as four per cent to six per cent a year in the first ten years.

The deal would provide new opportunities for Vietnam to increase exports of clothing, seafood and agricultural products. The products Vietnam could not export before due to high tariffs can now be exported to the EU market with more competitive prices.

The deal would also benefit the EU, increasing the region’s income. It provides a big opportunity for European exporters. The EU hopes to finish processing this free trade agreement quickly so that businesses, workers and consumers alike in the EU can reap benefits as soon as possible.

However, signing of the EVFTA can also give rise to several challenges. There will be competitive pressure in the farming and automobile sectors but that’s not considered unusual. The deal is expected to be signed at the end of this year. Vietnam is the second country in the southeast Asian region after Singapore with which the EU has reached a free trade agreement.