The European Union and Vietnam signed a Trade Agreement and an Investment Protection Agreement on 30 June 2019.
Vietnam is one of the 10 members of the Association of Southeast Asian Nations (ASEAN) and has become the EU's second most important trading partner in the region after Singapore. An increasing number of European companies are establishing in the country to set up a hub to serve the Mekong region.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) became o cial in January while the EU Viet Nam Free Trade Agreement (EVFTA) was signed in June 2019. This historic and ambitious agreement will eliminate 99% of customs duties and has raised interest in industrial property. Regional Comprehensive and Economic Partnership (RCEP) negotiations are underway and are expected to be finalised at the end of 2019. The agreement will increase cooperation between ASEAN countries and the six Asia-Pacific states with existing free trade agreements.
- Sufficient labor capacity
With 10% of the workforce in the FDI sector and 40% in the agricultural industry, there is excellent potential for labor to shift “from the farm to the factory”, fueling industrialization.
Low labor costs and government incentives, particularly preferential tax rates, will continue to be critical drivers
The real benefit to manufacturing in Vietnam is the shipping advantage. The country international airports, several major ports, reliable power, and easy access to the internet and cellular networks. Since the country is small, most suppliers are located close to an airport or major port.
- Vietnam combines a strong supply chain and industrial experience — with an eager-to-learn workforce and lower labor costs. The per-hour rate of labor costs in Vietnam remain less than half of those in China.
Thanks to the Vietnamese government, the infrastructure has improved massively in the last few years. This means, it's not just sportswear & backpack manufacturers in Vietnam anymore, technology based factories are flooding the open spaces of Vietnam and are attracting big companies like Samsung, Canon, IBM, etc to manufacture in Vietnam itself.
Here’s a list of Vietnam’s top 10 exports:
- Electrical machinery and equipment: 39% of exports
- Footwear: 7.9%
- Clothing and accessories: 5.7%
- Machinery including computers: 5.5%
- Knit/crochet clothing and accessories: 5.3%
- Furniture, bedding, lighting, signs, and prefab buildings: 3.5%
- Optical/medical/technical apparatus: 2.2%
- Fish: 2%
- Plastics and plastic articles: 1.5%
- Leather articles: 1.5%
Vietnam foreign policy: In the world current politics right now, like in this very moment right now. Vietnam is consider a neutral country. There are a lot of trade between the three biggest country: China, Russia and USA. No reason for the Western countries to touch a neutral ground yes? This is one of the main reason why Vietnam was put as a place for North Korea and USA to meet each other during the 2019. (Trump - Kim meeting).