The European Commission Delegation to Vietnam has announced its report on the economic situation and business and investment environment in Vietnam which confirms that the EU remains Vietnam’s premier trading partner and is the largest export market for the country.
Speaking at a press conference in Hanoi on May 29, Commercial Counsellor Antonio Berenguer cited data from the EC Statistical Office (Eurostat) that showed the EU absorbed approximate EUR8.3 billion (US$12.2 billion) of Vietnamese exports in 2008, surpassing the US, which imported US$11.86 billion worth of goods from the Southeast Asian country.
“The EU has further improved its role as a major partner in Vietnam in economic terms and the bloc’s imports from Vietnam also continued to concentrate on labour-intensive products,” he said, adding that footwear continued to be the biggest export item.
In addition, the EU is the second largest investor, after Japan, in terms of cumulative implemented investment in Vietnam with US$7 billion or 60 percent of EU committed investment, according to Vietnam’s Foreign Investment Agency data. This ratio is four times higher than the 2008 national average, confirming the commitment of the EU business community to Vietnam, even in times of crisis.
The Green Book 2009, which presents the assessment of the EC Delegation to Vietnam and the EU Member States’ Trade Counsellors, also confirms that the Vietnamese government successfully managed to contain inflation by tightening monetary policy and applying fiscal restraint in the face of overheating economic growth.
According to the report, 2008 witnessed a GDP growth of 6.18 percent and Vietnam is forecast to be among the only 12 world economies registering positive economic growth in 2009.
“The EU concurs with many analysts in that the dragon has slowed down and is certainly suffering but it is still in reasonable shape and is perfectly capable of coming back to full health as soon as the external conditions – its external markets – allow,” the report says.
However, EC Trade Counsellors recommended that Vietnam should reduce red-tape and continue the pace of trade liberalisation, including FTA negotiations with major trading partners like the EU. As well, it should further strengthen the IP protection system, infrastructure, human resources and bankruptcy regulations in order to attract higher quality investment, especially in the technology sector.