(Tiểu luận) essay topic opportunities and challenges of evfta for seafood enterprises in vietnam

TON DUC THANG UNIVERSITY
FACULTY OF BUSINESS ADMINISTRATION
MAJOR: INTERNATIONAL BUSINESS

ESSAY
TOPIC: OPPORTUNITIES AND CHALLENGES
OF EVFTA FOR SEAFOOD ENTERPRISES IN VIETNAM

Lecturer: Le Duc Nha
Group: 4 – shift 2 (Thursday)

Ho Chi Minh City, 20th of November, 2021

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LIST OF GROUP MEMBERS
Full Name

Student ID

Role

1

Nguyen Thi Hong Ngoc

719D0105

Leader

2

Huynh Muoi Luy

719D0082

Secretary

3

Huynh Thi Thanh Hoai

719D0105

Member

4

Nguyen Mai Linh

719D0077

Member

5

Hinh Van Ty

719D0221

Member

6

Tran Kha Nhi

719D0124

Member

7

Le Duong Thi Thanh Thanh

719D0155

Member

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COMPLETION LEVEL EVALUATION TABLE

1

2

3

4

Full name

Student
ID

Huynh Thi Thanh Hoai

719D0052

Nguyen Mai Linh

719D0077

Huynh Muoi Luy

719D0082

Nguyen Thi Hong Ngoc

Assignment of
duties

719D0105

6

7

Tra Kha Nhi

Le Duong Thi Thanh Thanh

Chapter 2
(2.2.2 &
2.3.1)

100%

Signed

-

Chapter 2
(2.1 & 2.2.1)

100%

Signed

-

Chapter 2
(2.3.2 & 2.4)

100%

Signed

-

Chapter 1
(1.2)
Chapter 3
Reviewing
the whole
content essay

100%

Signed

Chapter 1
(1.1.2 &
1.1.3)

100%

Signed

-

Chapter 2
(2.5)

100%

Signed

-

Introduction
Chapter 1
(1.1.1)
Conclusion

100%

Signed

-

Hinh Van Ty

719D0124

719D0155

719D0221

-

0

Signature

-

5

Evaluation

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THANK YOU
The first thing we want to say on behalf of the entire group is that this subject is
important; it has provided us with a general overview of the worldwide business field.
This is a significant subject in university programs since it not only provides broad
knowledge about the industry but also provides real data on business needs. We have
gathered a lot of lessons, positive experiences, and skills from this subject over the last
few months.
We'd want to thank PhD. Le Duc Nha, who taught and shared vital knowledge
and experiences with us over the course of the study. The professors' knowledge and
fact-sharing stories will undoubtedly lay the groundwork for us to be successful in our
future occupations.
However, preparing essay, report or presentations while researching will almost
always result in errors. As a result, we expect that our professors and classmates would
comment and assess more so that we can progress in other disciplines. Thank you for
everything.

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COMMENTARY OF LECTURER

-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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TABLE OF CONTENTS
INTRODUCTION ......................................................................................................... 1
CHAPTER 1:OVERVIEW OF KNOWLEDGE RELATED TO REGIONAL
ECONOMIC INTEGRATION AND A GENERAL INTRODUCTION TO EVFTA
......................................................................................................................................... 3
1.1 AN OVERVIEW OF KNOWLEDGE ABOUT REGIONAL ECONOMIC INTEGRATION
(FTA) .............................................................................................................................. 3
1.1.1 Definition and levels of regional economic integration ........................... 3
1.1.2 The benefits and limitations of regional economic integration .............. 5
1.1.3 Governance implications for businesses (in general) in the framework
of economic integration between regions .................................................................... 6

1.2 OVERVIEW OF THE EVFTA AGREEMENT BETWEEN VIETNAM AND THE
EUROPEAN UNION (EU) ................................................................................................. 6
1.2.1 General introduction about EVFTA Agreement ..................................... 6
1.2.2 Trade cooperation relationship between EU and Vietnam .................... 8
CHAPTER 2: THE IMPACT OF THE EVFTA ON THE VIETNAMESE
SEAFOOD INDUSTRY. AN EXAMINATION OF THE OPPORTUNITIES AND
PROBLEMS THAT BUSINESSES IN VIETNAM CONFRONT ......................... 10
2.1 OVERVIEW OF THE SEAFOOD INDUSTRY IN VIETNAM .......................................... 10
2.2 OVERVIEW OF VIETNAM'S SEAFOOD PRODUCTION, CONSUMPTION AND EXPORT
SITUATION ..................................................................................................................... 12
2.2.1 Before EVFTA comes into effect .............................................................. 12
2.2.2 After the EVFTA comes into effect .......................................................... 16
2.3 OVERVIEW OF SEAFOOD CONSUMPTION IN THE EUROPEAN MARKET ................ 17
2.3.1 Import demand and the primary sources of seafood supply in Europe17
2.3.2 People's tastes and consumption trends before and after the COVID-19
pandemic ...................................................................................................................... 18
2.4 IMPACT OF EVFTA ON FISHERIES INDUSTRY IN VIETNAM ................................. 19
2.5 OPPORTUNITIES AND CHALLENGES THAT SEAFOOD ENTERPRISES IN VIETNAM
ARE FACING WHEN PARTICIPATING IN THE EVFTA AGREEMENT ............................ 20
2.5.1 Opportunities ............................................................................................. 20
2.5.2 Challenges .................................................................................................. 21

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CHAPTER 3: SOLUTIONS FOR VIETNAMESE SEAFOOD BUSINESSES TO

TAKE FULL ADVANTAGE OF THE EVFTA AGREEMENT ........................... 23
3.1 VIETNAMESE SEAFOOD ENTERPRISES NEED TO FOCUS ON DEVELOPING DOMESTIC
RAW MATERIALS ........................................................................................................... 23
3.2 VIETNAMESE SEAFOOD ENTERPRISES NEED TO WORK CLOSELY WITH
GOVERNMENT INSTITUTIONS IN EFFORTS TO IMPLEMENT EVFTA .......................... 23
3.3 ENTERPRISES NEED TO MAKE EFFORTS TO LEARN ABOUT EVFTA AND KNOW
HOW TO APPLY TECHNOLOGICAL INNOVATION TO IMPROVE PRODUCT QUALITY ... 23
CONCLUSION ............................................................................................................ 25

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TABLE OF TABLE
TABLE 1: SUMMARY OF LEVELS OF REGIONAL ECONOMIC INTEGRATION ................. 4
TABLE 2: MILESTONES IN THE RELATIONSHIP BETWEEN VIETNAM AND THE EU ..... 8

TABLE OF FIGURES
FIGURE 1: OUTPUT OF A QUACULTURE AND FISHING IN VIETNAM (THOUSAND TONS) ......... 10
FIGURE 2: A QUACULTURE PRODUCTION OF VIETNAM FROM 1995 TO 2020.......................... 11
FIGURE 3: FISHING PRODUCTION OF VIETNAM FROM 1995 TO 2020 ..................................... 12
FIGURE 4: VIETNAM SEAFOOD EXPORT FROM 1997 TO 2020 ................................................. 13
FIGURE 5: VIETNAM’S SEAFOOD EXPORT STRUCTURE BY REGION 2019................................ 14
FIGURE 6: TOTAL SEAFOOD EXPORT TURNOVER OF VIETNAM AND TO THE EU ................... 15
FIGURE 7: STRUCTURE OF VIETNAM’S SEAFOOD EXPORT INDUSTRY TO THE EU IN 2019 .... 15
FIGURE 8: EU SEAFOOD IMPORTS FROM OUTSIDE THE BLOC IN 2020 - 2021......................... 18

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INTRODUCTION
International business is a fundamental subject that provides us with knowledge
about business issues such as globalization, foreign direct investment, international trade
theories or entry strategies, and strategic alliances to help students accumulate
foundational lessons for their own future work, such as supporting businesses and
countries in the process of economic linkage, international market integration, and
expanding cooperation relations.
Specifically, my group found the material of the chapter on regional economic
integration to be particularly engaging during the research because the theories discussed
were closely related to reality. After studying this chapter, my team realized that the
essence of regional economic integration was free trade agreements, which were created
to remove barriers to most trade activities while also promoting trade exchanges between
member countries, thereby creating opportunities for import and export enterprises as
well as helping them improve their competitiveness and contribute to the country
becoming rich.
Many free trade agreements have been reached between our country and other
countries on a worldwide scale, including the ASEAN-Japan agreement, EVFTA,
Vietnam-Korea, CPTPP, and others. However, after much discussion, my team opted for
the EVFTA because it not only serves the interests of the two parties (Vietnam and the
EU), but it also provides significant prospects for our country to be linked into the global
value chain and deepen international integration. Furthermore, according to Mr. Pham
Binh Minh (Politburo member - Deputy Minister, Ministry of Foreign Affairs), Europe
is Vietnam's second-largest export market, third-largest economic - trade partner, and

fourth-largest foreign investor. As a result, analyzing the EVFTA agreement for this
essay allows my team to have a more thorough understanding of its laws, rules,
opportunities, and problems for Vietnamese firms, resulting in some recommendations
for making good use of this agreement.
However, we can see in the EVFTA agreement that there are numerous industries
that will gain as soon as the EVFTA goes into force, such as rice, fish, vegetables,
textiles, coffee, timber, etc. milk, ... thus assessing all such content will be tough. As a
result, my group opted to focus on a certain area to simplify the analysis, and my group's
choice was seafood because it is a vital industry in our country, with the benefits of
Under natural conditions, Vietnam has the ability to grow the aquaculture and fishing
industries and deliver their own products to the international market.
In summary, in this short essay, my group will summarize the outstanding
knowledge learned in the subject of International Business, specifically the chapter on
regional economic integration, from which to analyze the current situation as well as the

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opportunities and challenges of the EVFTA to Vietnamese seafood enterprises. The
essay will be classified into three major chapters, which are as follows:
Chapter 1: Overview of knowledge related to regional economic integration and
a general introduction to EVFTA
Chapter 2: The impact of the EVFTA on the Vietnamese seafood industry. An
examination of the opportunities and problems that businesses in Vietnam confront

Chapter 3: Solutions for Vietnamese seafood businesses to take full advantage of
the EVFTA agreement

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CHAPTER 1: OVERVIEW OF KNOWLEDGE RELATED TO REGIONAL
ECONOMIC INTEGRATION AND A GENERAL INTRODUCTION TO
EVFTA
1.1 An overview of knowledge about regional economic integration (FTA)
1.1.1 Definition and levels of regional economic integration
According to author Charles W. L. Hill's textbook "International Business Competing in the Global Marketplace," regional economic integration is defined as
agreements between countries in a geographic region to reduce, and eventually
eliminate, tariff and non-tariff barriers to the free flow of goods, services, and production
inputs. Regional economic integration provides member governments with considerable
economic benefits, such as enhanced market efficiency, and working closely together to
promote peace, stability, and prosperity, as well as building a block to integrate with
each other in the context of globalization. Based on the information obtained, we know
that regional economic integration is separated into five major stages, with a mutual
inheritance link between them. The levels of regional economic policy integration are
shown in Table 1 below:

Forms of

Intra-

General

Free

General

A

economic

regional

trade

Factor

monetary

government

association

free

policy

Shift

and fiscal

trade

Free Trade
Area

Yes

policy

No

No

No

No

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Customs
Union

Yes

Yes

No

No

No

Common
market

Yes

Yes

Yes

No

No

Economic
Union

Yes

Yes

Yes

Yes

No

Political
Union

Yes

Yes

Yes

Yes

Yes

Table 1: Summary of levels of regional economic integration
Source: El-Agraa, Ali M. (1999), and Measurement=, London, Macmilan Press
The first level is concerned with preferential trade agreements, in which member
countries simply remove tariff and service obstacles. For example, the ASEAN-Korea
agreement is a framework agreement on extensive economic cooperation. Because
Vietnam is also a member of ASEAN, Korea has committed to eliminating import taxes
as promised in this agreement since 2010, and we currently have 90.9 percent of
Vietnamese goods exporting to Korea enjoying a tax rate of 0%.
The second level is known as the customs union; at this level, the parties to the

agreement not only eliminate most trade, tariff, and non-tariff obstacles to each other, as
they did in the first level but also share a single commercial strategy. Community of the
Andes (CAN) Is a customs union whose members include, among others, Bolivia,

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Colombia, Ecuador, and Peru. Although this arrangement complicates policy
coordination among member countries, its strength is that it allows us to avoid
complexities relating to rules of origin.
Next, the third level is known as the common market; at this level, participating
countries will enjoy the preferential policies of two levels, as well as the novel feature
of allowing free movement of elements of production such as capital and labor.
According to my team, such a single market was established in Europe in 1957 under
the Treaty of Rome (effective January 1, 1958) by countries such as the Federal Republic
of Germany, Italy, France, Belgium, the Netherlands, Luxembourg, or the common
market of East and South Africa in 1994.
The fourth level is termed economic union, and it includes levels one through
three, as well as the extra characteristic of member countries using the same currency,
or having a similar monetary and fiscal policy. The European Union (EU) has now been
founded with the goal of boosting collaboration and connectivity among member nations
in order to grow Europe into a world economic superpower.
And the final level is called political alliance; this is a level that includes all of the
levels mentioned above, as well as a government/administrative state that links the forces

together to form a unified block to achieve common political goals such as education,
culture,...but there are no examples of this in reality at the moment.
1.1.2 The benefits and limitations of regional economic integration
Regional economic integration or participation in accords provides significant
benefits to that country. First, it stimulates the economy by removing tariff barriers for
the majority of participating countries' exports, allowing firms to reduce costs and so
improve competitiveness, people's living standards, and the country's prosperity.
Furthermore, it serves to strengthen the voice of the area (groups of member nations)
since they can find an appropriate place in the new world order, thereby increasing their
reputation, credibility, and development in the region and around the world.
Although there are numerous benefits to participating in regional economic
integration, there are also drawbacks. Firstly, a country may be in difficulties if its
partner country is in problems. This is especially evident in the last two years of the
COVID-19 outbreak, when Vietnam has faced many challenges because China is a large
partner that helps us export a lot of commodities, but it is also the source of numerous
epidemics. The second disadvantage is that people's right to self-determination is under
threat as a result of regional economic integration, which has increased the possibility of
national identity and traditional culture being undermined and overrun by foreign
cultures. We surely remember the event that the UK officially left the EU after 45 years
of attachment on November 13, 2018, because they believed that the EU had strict
regulations, that many people took advantage of the EU to immigrate illegally

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permission, that the EU single currency isn't working, that their government is being
overwhelmed, and that they don't want to survive annual contributions, which has huge
consequences because Britain is one of the world's great powers.
1.1.3 Governance implications for businesses (in general) in the framework of
economic integration between regions
Regional economic integration provides businesses with more and more
opportunities to expand their market; through the signing and implementation of trade
agreements, participating countries can expand their export markets to partner countries,
from which we can easily penetrate deeper into the global value chain bridge. Next, it
assists businesses in expanding the production value chain by allowing them to locate
their company headquarters and processing factories in the agreement's partner
countries, lowering the cost of transportation and production of goods, and especially
allowing finished products to be brought to market quickly after being manufactured in
the country where the head office is located.
However, businesses should understand that the more opportunities there are the
more challenges. For example, when an enterprise in this country participates in
investment and production in the partner country, there are still other businesses with
similar goals, and it is clear that less developed countries will suffer more negative
consequences. Enterprises with the same product line, as well as clients from developed
countries that benefit from more advanced manufacturing techniques, have steadily
dominated the market. The competition from partner countries can be seen as very large
and is always a risk that we can see, which is why businesses must make efforts to
improve their competitiveness as well as improve the quality of their products/services
so that they can still develop sustainably regardless of who they rely on.
1.2 Overview of the EVFTA Agreement between Vietnam and the European Union
(EU)
1.2.1 General introduction about EVFTA Agreement
The EU-Vietnam Free Trade Agreement (EVFTA) is a new generation FTA
between Vietnam and 28 EU member countries. It is one of two agreements with the

broadest breadth of commitments and the highest level of commitment from Vietnam.
The circumstances of this agreement are most likely when our country understands that
many commodities imported and exported from Europe are subject to excessively high
tax rates, resulting in considerable price increases, such as automobiles. Tax rates in past
years were as high as 70%, therefore the EVFTA is seen as a complete, high-quality deal
that benefits both Vietnam and the EU.
The EVFTA signing process can be divided into three key phases: the preparatory
negotiating phase (from 2010 to 2017), the review and approval phase (from 2018 to

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2019), and the current official period. My team has concluded the following key
milestones time in the signing procedure of this EVFTA agreement through the selfresearch process as follow:
a) The preparatory negotiating phase (from 2010 to 2017):
• The Prime Minister of Vietnam and the President of the European Union have
agreed to begin discussions on the EVFTA Agreement in October 2010.
• In June 2012, Vietnam's Minister of Industry and Trade and the EU Trade
Commissioner officially confirmed the commencement of negotiations for the
EVFTA Agreement.
• Vietnam and the EU completed negotiations and began a legal assessment in
December 2015 in preparation for the signing of the Agreement.
• In June 2017, the two parties concluded the technical legal evaluation.
• In September 2017, the EU officially requested that Vietnam divide the discussion

material into two separate accords, namely the free trade agreement (EVFTA) and
the investment protection agreement (IPA).
b) The review and approval phase (from 2018 to 2019)
• Vietnam and the EU have legally agreed to split the two distinct agreements,
completing the whole legal review process of the EVFTA agreement and agreeing
on all of the elements of the IPA agreement in June 2018.
• In August 2018, the IPA Agreement will have undergone a thorough legal
assessment.
• On October 17, 2018, the European Commission formally approved the EVFTA
and IPA.
• On June 25, 2019, the European Council approved the signing of the Agreement.
c) The current official period (2019 - now)
• On June 8, 2020, the Vietnamese National Assembly ratified the EVFTA with
457/457 votes.
• On July 27, 2020, Prime Minister Nguyen Xuan Phuc spoke by phone with
European Commission President Ursula von der Leyen.
• The EVFTA Agreement will go into force on August 1, 2020.
Essentially, the EVFTA agreement's content consists of 17 chapters, two
protocols, and several memorandums of understanding, with the four main parts,
mentioned being banking, insurance, telecommunications, and tax rates - this part being
the most important because it has a significant impact on Vietnam's economy. The
agreement includes provisions for trade in goods, laws of origin, customs and trade
sustainable development.

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1.2.2 Trade cooperation relationship between EU and Vietnam
Since 1990, Vietnam and the European Union have had diplomatic ties. The two
sides are primarily interested in politics, economy, trade, investment, and development
cooperation, as well as education, science, and technology... Looking back on this
voyage, we can observe that Vietnam-EU relations have expanded rapidly in both
breadth and depth.
Since becoming global partners, the two sides have united, collaborated, and
signed numerous agreements that benefit or create greater chances for the expansion of
ASEAN-EU collaboration. Several accords, such as the EU-Vietnam Partnership and
Comprehensive Cooperation Agreement (PCA), the EVFTA and EVIPA agreements,
the textile and garment agreement, and so on. Table 2 below allows us to reflect back on
key concerns in Vietnam and the EU over the years:

Table 2: Milestones in the relationship between Vietnam and the EU
(Source: Nhan Dan Newspaper)
Mr. Josep Borrell (Vice-President of the European Commission and High
Representative of the EU) stated that the EU-Vietnam relationship has achieved
remarkable achievements and exponential growth, with GDP per capita currently at
$2,700 USD, total international trade at more than 550 billion USD, and trade relations
at more than 50 billion USD. This demonstrates that, in addition to the EU's support in
many areas, Vietnam has had to make significant efforts, thanks to the economic reform
of the Doi Moi strategy (Renovation) to achieve the success it has today.

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Furthermore, at the recent COP26 conference, Prime Minister Pham Minh Chinh
met with the President of the European Commission (EC), Ursula von der Leyen, and he
emphasized that the EU is one of the world's leading partners, strategic partner role in
regional and international security, peace, economic development in domestic and
international. In response to that affirmation, Ms. Ursula von der Leyen, President of the
European Commission (EC), stated that the EU will continue to support Vietnam through
two channels, direct vaccine export through the COVAX mechanism, and directed EU
agencies to actively consider Vietnam's proposal to remove the IUU yellow card declaring illegal, undeclared, and unregulated seafood. Thus, we anticipate that in the
future, there will undoubtedly be more tremendous successes between our country and
the EU, not only on the aforementioned problems but also on other matters linked to
climate change and sustainable development.

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CHAPTER 2: THE IMPACT OF THE EVFTA ON THE VIETNAMESE
SEAFOOD INDUSTRY. AN EXAMINATION OF THE OPPORTUNITIES AND
PROBLEMS THAT BUSINESSES IN VIETNAM CONFRONT

2.1 Overview of the seafood industry in Vietnam
Vietnam in general has the advantage of a dense river system with a coastline of
more than 3,260 kilometers with an exclusive economic zone of more than 1 million
square kilometers, all of which provide several commercial prospects to expand fishing
and aquaculture operations in the fisheries industry.

Figure 1: Output of Aquaculture and Fishing in Vietnam (thousand tons)
Looking at the graph above from VASEP, Vietnam's seafood output witnessed a
considerable increase at an annual rate of 8% year after year, in which aquaculture
production contributes for 54% of total output, while fishing accounts for 46%.
According to the Directorate of Fisheries report, the value of seafood production
climbed by 2.79 percent in the first six months of 2020, with total output estimated at
3.86 million tons, a rise of around 1.6 percent over the same period last year. In the year
2019, fishing output reached 1.88 million tons and aquaculture production reached 1.97
million tons, up 1.4% and 1.8% respectively.

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Figure 2: Aquaculture production of Vietnam from 1995 to 2020
Looking at the graph above, it is apparent that Vietnam's aquaculture production
rose dramatically from 1995 to 2020, with an average yearly growth of 10% from 415
thousand tons to approximately 4.6 million tons. Aquaculture for export accounts for 95
percent of total pangasius output and 80 percent of shrimp production, primarily in the

Mekong Delta.

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Figure 3: Fishing production of Vietnam from 1995 to 2020
The data also reveals that, over the same time period, there was an increase by
more than fourfold of Vietnam's fishing productivity, with an average yearly rise of 6%
from 929 thousand tons to 3.85 million tons.
In conclusion, we can see that the growth of the fisheries industry not only helps
enterprises financially but also contributes significantly to the economic sector of our
nation.
2.2 Overview of Vietnam's seafood production, consumption and export situation
2.2.1 Before EVFTA comes into effect
First, according to data from the Vietnam Association of Seafood Exports and
Producers, Vietnam's seafood export situation has essentially improved from 1997 to
2020 (before the EVFTA took effect on August 1, 2020), with an average annual growth
rate of 10% from 758 million USD to 8.5 billion USD and a tendency to increase in the
coming years. We can see from the graphic below that fisheries are an important
economic sector in our nation with a lot of promise in the future.

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Colombia, Ecuador, and Peru. Although this arrangement complicates policy
coordination among member countries, its strength is that it allows us to avoid
complexities relating to rules of origin.

Next, the third level is known as the common market; at this level, participating
countries will enjoy the preferential policies of two levels, as well as the novel feature
of allowing free movement of elements of production such as capital and labor
According to my team, such a single market was established in Europe in 1957 under
the Treaty of Rome (effective January 1, 1958) by countries such as the Federal Republic
of Germany, Italy, France, Belgium, the Netherlands, Luxembourg, or the common
market of East and South Africa in 1994.

The fourth level is termed economic union, and it includes levels one through
three, as well as the extra characteristic of member countries using the same currency
or having a similar monetary and fiscal policy. The European Union (EU) has now been
founded with the goal of boosting collaboration and connectivity among member nations
in order to grow Europe into a world economic superpower.

And the final level is called political alliance; this is a level that includes all of the
levels mentioned above, as well as a government/administrative state that links the forces
together to form a unified block to achieve common political goals such as education
0
culture,...but there are no examples
of0 this in reality at the moment.

Tieu luan

1.1.2 The benefits and limitations of regional economic integration


Regional economic integration or participation in accords provides significant
benefits to that country. First, it stimulates the economy by removing tariff barriers for
the majority of participating countries' exports, allowing firms to reduce costs and so
improve competitiveness, people's living standards, and the country's prosperity.
Furthermore, it serves to strengthen the voice of the area (groups of member nations)
since they can find an appropriate place in the new world order, thereby increasing their
reputation, credibility, and development in the region and around the world.

Although there are numerous benefits to participating in regional economic
integration, there are also drawbacks. Firstly, a country may be in difficulties if its
partner country is in problems. This is especially evident in the last two years of the
COVID-19 outbreak, when Vietnam has faced many challenges because China is a large
partner that helps us export a lot of commodities, but it is also the source of numerous
epidemics. The second disadvantage is that people's right to self-determination is under
threat as a result of regional economic integration, which has increased the possibility of
national identity and traditional culture being undermined and overrun by foreign
cultures. We surely remember the event that the UK officially left the EU after 45 years
of attachment on November 13, 2018, because they believed that the EU had strict
regulations, that many people took advantage of the EU to immigrate illegally

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0

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permission, that the EU single currency isn't working, that their government is being
overwhelmed, and that they don't want to survive annual contributions, which has huge
consequences because Britain is one of the world's great powers.
1.1.3 Governance implications for businesses (in general) in the framework of
economic integration between regions

Regional economic integration provides businesses with more and more
opportunities to expand their market; through the signing and implementation of trade
agreements, participating countries can expand their export markets to partner countries
from which we can easily penetrate deeper into the global value chain bridge. Next, it
assists businesses in expanding the production value chain by allowing them to locate
their company headquarters and processing factories in the agreement's partner
countries, lowering the cost of transportation and production of goods, and especially
allowing finished products to be brought to market quickly after being manufactured in
the country where the head office is located.

However, businesses should understand that the more opportunities there are the
more challenges. For example, when an enterprise in this country participates in
investment and production in the partner country, there are still other businesses with
similar goals, and it is clear that less developed countries will suffer more negative
consequences. Enterprises with the same product line, as well as clients from developed
countries that benefit from more advanced manufacturing techniques, have steadily
dominated the market. The competition from partner countries can be seen as very large
and is always a risk that we can see, which is why businesses must make efforts to
improve their competitiveness as well as improve the quality of their products/services

so that they can still develop sustainably regardless of who they rely on.
1.2 Overview of the EVFTA Agreement between Vietnam and the European Union
(EU)
1.2.1 General introduction about EVFTA Agreement

The EU-Vietnam Free Trade Agreement (EVFTA) is a new generation FTA
between Vietnam and 28 EU member countries. It is one of two agreements with the
broadest breadth of commitments and the highest level of commitment from Vietnam
The circumstances of this agreement are most likely when our country understands tha
0
0
many commodities imported and exported from Europe are subject to excessively high
Tieu price
luanincreases, such as automobiles. Tax rates in pas
tax rates, resulting in considerable


years were as high as 70%, therefore the EVFTA is seen as a complete, high-quality deal
that benefits both Vietnam and the EU.

The EVFTA signing process can be divided into three key phases: the preparatory
negotiating phase (from 2010 to 2017), the review and approval phase (from 2018 to

6

0

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Tieu luan

2019), and the current official period. My team has concluded the following key
milestones time in the signing procedure of this EVFTA agreement through the selfresearch process as follow:
a) The preparatory negotiating phase (from 2010 to 2017):

• The Prime Minister of Vietnam and the President of the European Union have
agreed to begin discussions on the EVFTA Agreement in October 2010.
• In June 2012, Vietnam's Minister of Industry and Trade and the EU Trade
Commissioner officially confirmed the commencement of negotiations for the
EVFTA Agreement.
• Vietnam and the EU completed negotiations and began a legal assessment in
December 2015 in preparation for the signing of the Agreement.
• In June 2017, the two parties concluded the technical legal evaluation.
• In September 2017, the EU officially requested that Vietnam divide the discussion
material into two separate accords, namely the free trade agreement (EVFTA) and
the investment protection agreement (IPA).
b) The review and approval phase (from 2018 to 2019)

• Vietnam and the EU have legally agreed to split the two distinct agreements,
completing the whole legal review process of the EVFTA agreement and agreeing
on all of the elements of the IPA agreement in June 2018.
• In August 2018, the IPA Agreement will have undergone a thorough legal
assessment.
• On October 17, 2018, the European Commission formally approved the EVFTA
and IPA.
• On June 25, 2019, the European Council approved the signing of the Agreement.
c) The current official period (2019 - now)

• On June 8, 2020, the Vietnamese National Assembly ratified the EVFTA with

457/457 votes.
• On July 27, 2020, Prime Minister Nguyen Xuan Phuc spoke by phone with
European Commission President Ursula von der Leyen.
• The EVFTA Agreement will go into force on August 1, 2020.

Essentially, the EVFTA agreement's content consists of 17 chapters, two
protocols, and several memorandums of understanding, with the four main parts
mentioned being banking, insurance, telecommunications, and tax rates - this part being
the most important because it has a significant impact on Vietnam's economy. The
agreement includes provisions for trade in goods, laws of origin, customs and trade
sustainable development.

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