Brussels, 14 March 2014
EU Trade Commissioner De Gucht travels to South East Asia to boost trade ties with Vietnam, Cambodia and Myanmar
As part of ongoing efforts to bolster the EU’s trade links with ASEAN countries, EU Trade Commissioner Karel De Gucht will next week travel to Vietnam, Cambodia and Myanmar. During his four-day visit from 17 to 20 March, the Commissioner will hold high level talks with his counterparts in each country. His arrival in Hanoi will coincide with the start of the 7th round of talks for an EU-Vietnam free trade agreement (FTA), while in Myanmar capital Nay Pyi Taw the Commissioner is expected to launch negotiations for an EU-Myanmar investment protection agreement.
’I’m looking forward to constructive talks with our partners in South East Asia,’ said the Commissioner on the eve of his visit. ’Experience is showing how opening up to trade is helping these dynamic countries raise living standards. At the same time, their markets provide opportunities for European exporters, so we really do have a win-win situation.’
The Commissioner’s visit will begin in the Vietnamese capital Hanoi, Vietnam, where he will meet Prime Minister Nguyen Tan Dung and the Minister of Industry and Trade Vu Huy Hoang to take stock of progress in the ongoing FTA negotiations. Together, the leaders will open the latest round of talks that began in June 2012. The round will run from 17-21 March. Both sides are looking for a swift conclusion of the negotiations so that businesses can start reaping the benefits of what is expected to be an ambitious agreement. Once in place, the agreement will boost EU-Vietnam trade and investment ties and provide more business opportunities on both sides.
In Cambodia, Commissioner De Gucht will meet his counterpart Sun Chanthol, Senior Minister of Commerce. Their discussions will follow on from the recently held EU-Cambodia Joint Committee.
On his first official visit to Myanmar, the Commissioner will meet Dr Kan Zaw, Minister of National Planning and Economic Development, and is scheduled to meet Win Myint, Minister of Commerce. He will also meet leader of the opposition party the National League for Democracy (NLD), Daw Aung San Suu Kyi.
With Minister Kan Zaw, Commissioner De Gucht is expected to launch the negotiations of an EU-Myanmar investment protection agreement. This follows on from the recent reinstatement of trade preferences under the Everything But Arms scheme in July 2013.
The EU and Vietnam, one of the 10 ASEAN countries, announced the start of bilateral FTA negotiations in Brussels in June 2012. Vietnam is the third ASEAN country to hold FTA negotiations with the EU after Singapore and Malaysia, and followed by Thailand. The FTA will cover trade in goods and services, investment, government procurement, intellectual property rights, including geographical indications, and other regulatory issues such as non-tariff barriers, animal and plant health and hygiene issues, technical barriers to trade, customs and trade facilitation, and trade and sustainable development.
The EU and Vietnam have strong trade ties. In 2013, Vietnam became the EU’s 4th largest trading partner in ASEAN (and 32nd overall). In 2012, two-way trade amounted to almost €24 bn, with EU exports to Vietnam amounting to €5.3 bn and EU imports from Vietnam to €18.5 bn. The EU is one of the largest foreign direct investors in Vietnam, committing €1.37bn in total.
While pursuing a bilateral approach, the EU is not losing sight of the ultimate goal of achieving an agreement with ASEAN as a whole, one of the most dynamic regions in the world. The EU is therefore looking to reach an ambitious agreement with Vietnam that is coherent with other individual FTAs with ASEAN members.
EU exports are mainly high-tech products – electrical machinery and equipment, aircraft, vehicles, pharmaceutical products and iron and steel. Vietnam’s key exports to the EU include telephone sets, electronic products, footwear, textiles and clothing, coffee, rice, fishery products, and furniture.
As a Least Developed Country (LDC) Cambodia benefits from the most favourable regime available under the EU’s Generalised Scheme of Preferences (GSP), the Everything But Arms (EBA) scheme. The EBA Scheme gives the 49 Least Developed Countries duty free access to the EU for exports of all products, except arms and ammunition.
In 2013, bilateral trade in goods with Cambodia reached €2.8 bn, rising from €2.1 bn in 2012. Cambodian exports to the EU rose by 30% to hit €2.4 bn. The main exports were clothing (68.8%), footwear (12.9%), bicycles (10.3%), rice (5.2%) and sugar (1.6%). In 2013, the EU was Cambodia’s biggest export market, except for garments.
As an LDC, Myanmar, like Cambodia, benefits from the EBA scheme. It was reinstated into the GSP tariff preferences on 19 July 2013, with retroactive application as of 13 June 2012. This was a response to the process of political and economic reform begun in 2011 and followed the June 2012 decision by the Conference of the International Labour Organisation (ILO) to suspend its restrictive resolution on Myanmar. These preferences had been temporarily withdrawn since 1997 due to violations of the principles of the ILO convention on forced labour.
In 2013, bilateral trade in goods with Myanmar amounted to €569 m, compared to €403 million in 2012, a 41% increase.
Myanmar exports to the EU increased by 35% in 2013 to reach €223 m compared to €165 m in 2012. While previously focussed on garments (66.9%), fisheries products (8%), rice (4.4%) and beans (4.3%), in 2013 Myanmar’s exports saw the share of garments drop to 58.2%. Exports of precious stones (11.7%) and wood products (7.8%) re-entered the country’s export base, however.