Vietnam is expected to be hit by a new investment wave from Canada in the near future on the back of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and Vietnam’s improved investment and business climate.
|PM addresses the Viet Nam-Canada Business Roundtable in Québec city on June 8, 2018. Photo:VGP |
Key Vietnamese tariff cuts for Canadian exports
- Beef (tariffs of up to 31 per cent on fresh, chilled, and frozen beef will be eliminated within two years, and tariffs of up to 34 per cent on all other beef products will be removed within seven years);
- Pork (tariffs of up to 31 per cent on fresh, chilled, frozen, and prepared pork products will be annulled within nine years);
- Canola (tariffs of 5 per cent on canola seed will be eliminated upon entry into force, while tariffs of up to 20 per cent on canola oil will be erased within seven years); and
- Ice wine and whisky (tariffs of up to 56 per cent will be removed within ten years).
- Industrial machinery (tariffs of up to 25 per cent will be eliminated within eight years);
- Chemicals and plastics (tariffs of up to 31 per cent will be phased out within ten years);
- Metals and minerals (tariffs of up to 40 per cent will be annulled within 10 years); and
- Cosmetics (tariffs of up to 30 per cent will be abrogated within four years).
Prime Minister Nguyen Xuan Phuc told last week’s Vietnam-Canada Business Forum organised in Canada’s Québec city that the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which is about to take effect in the near future, and Vietnam’s improved investment and business climate “will lead to a new wave and even a boom of Canadian investment in Vietnam.”
The CPTPP involves 11 countries in the Asia-Pacific region, including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Upon entry into force, the CPTPP will see the immediate elimination of the vast majority of customs tariff lines, and the gradual reduction of certain other tariffs. Gaining market access to Vietnam is of particular significance for Canada, as Vietnam is not covered by any of Canada’s previous free trade agreements (FTAs) and Vietnam also imposed steep tariffs on imports (see box).
“The CPTPP will allow Canadian companies to invest with greater confidence in Vietnam, offering them protection from unfair and discriminatory treatment as well as greater predictability and transparency,” said a Canadian government document on how the CPTPP will impact Canadian-Vietnamese trade and investment ties. “Vietnam’s commitments on financial services go beyond what it has offered in previous FTAs, creating new opportunities for Canadian financial services providers.”
PM Phuc stressed that Canada is an important partner of Vietnam in the American region. The two countries forged a comprehensive partnership last November. “The two economies boast great potential and supplement each other rather than compete with each other,” PM Phuc stressed.
Two-way trade turnover hit $3.5 billion last year. Canada currently has 168 valid investment projects in Vietnam, registered at $5.12 billion.
PM Phuc noted that to benefit people and enterprises, Vietnam has been doing its utmost to build a facilitating government of integrity and action. “Our doors are always open to welcome all of you.”
Also at the forum, several deals were inked between the two countries, including a letter of intention on co-operation between Vietnam’s Ministry of Science and Technology and Québec Fund for Scientific Research; a deal on technical assistance at Vietnamese airports between Vietnam Airlines and the National Bank of Canada; a memorandum of understanding (MoU) on educational and research co-operation between Vietnam’s National Economics University and Québec University; and an MoU on robotel smart class between Vietnam’s Hoang Thanh Technological Development and Trade Co., Ltd. and Canada’s Robotel Group.