REVIEW
of
FINANCE -
Jan. 2018
11
the business and local industries’ requirements
yet assuring Viet Nam’s commitments to the FTA
partners.
Regarding to two recently signed FTAs, the
Viet Nam-Korea FTA did come into effects from
20/12/2015 (Circular no. 201/2015/TT-BTC dated
16/12/2015waspromulgatedtheSpecialPreferential
Import Tariff Schedule for Viet Nam – Korea FTA
in the period from 2015 to 2018). FTA between Viet
Nam and the Eurasian Economic Union (EAEU)
has been expected to be effective since 2nd Quarter
of 2016 and the date of entry into force is subject to
the completed internal procedures of all Member
States of EAEU. The Ministry of Finance carried
on developing the tariff reduction schedule,
consultation process with enterprises and the
related ministries to issue the Circular on special
preferential tariff schedule in due course once this
Agreement comes into effects.
In most of the signed FTAs of Viet Nam, the
liberalization level of import tariff reaches 90%
of tariff lines on average, excepting the ASEAN’s
Trade in Goods Agreement (ATIGA) which is the
internal regional agreement with approximate
98% of liberalization. On reduction schedule, the
FTA that has the soonest roadmap completion is
ATIGA (2018), followed by ACFTA (2020) and
AKFTA (2021). By 2015 the Viet Nam’s import
tariff liberalization level with the FTApartnerswas
relatively high: 93% in ATIGA, 84% in ASEAN-
China FTA, 78% inASEAN-Korea FTA and 62% in
ASEAN-Japan CEP. Accordingly, many products
with high import turnover from ASEAN, China
and Korea were eligible of 0% tariff rate since
2015 such as iron and steel, fertilizers, electronic
products, trucks, household electrical appliances,
machines and equipment,etc. Information of
tariff reduction schedule of those signed FTAs is
as follows: Commitment on import tariff under
two new generation FTAs which are TPP and Viet
Nam-EUFTAexposedhigher level of liberalization
and shorter schedules, going onward to eliminate
customs dutiesfor 100% of tariff lines, specifically
as follows:
With EU, Viet Nam commits to eliminate
immediately customs duties from the date of
entry into force of the Agreement for 48.5% of
tariff lines, equivalent to 64.5% of import turnover
from EU, and after 10 years for about 99% of tariff
This rate with form AJ and form VJ utilization for
exporting to Japan was 29% on average for 2009-
2013 period (with the highest rate was 31.2% of
2011); utilization of form E for exporting to China
was 19.6% for 2006-2013 period (with the year of
2013’s highest rate at 36%).
The import tariff reduction for input materials
of production resulted in lower production cost
for domestic enterprises, which helped more
competitiveness for domestically produced
goods, promoting export oriented production.
Enterprises can also choose imported goods with
different origins; the competitiveness thus is
also improved. Consumers, benefiting along this
development, are more accessible to better quality
imported and domestically produced products
with more affordable prices.
Further import tariff reduction
based on Committed Schedules
In 2015, the Ministry of Finance kept
implementation of the import tariff reduction
schedule within framework of 8 effective FTAs
by the Circulars promulgating the Special
Preferential Import Tariff Schedules for 2015-2018
period.
The Ministry of Finance is also actively
engaging in discussions, solicitations with
business community in issues related to the
implementing FTA tariff schedules in order to
make timely adjustment of policies adapting to
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02
03
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Vietnam has a strategic
or comprehensive
partnership with 13
APEC member
economies
The 5 major export
markets of Vietnam are
APEC members, including
the United States, China,
Japan, South Korea and
Hong Kong.
17 APEC members are
partners in the
Vietnamese FTA .
9 of the top 10
countries and territories
with the most
investment in Vietnam
are APEC members,
they are Korea, Japan,
Singapore, Taiwan,
Hong Kong, Malaysia,
the USA, China and
Thailand.
FIGURE 2: VIETNAM RELATIONS WITH APEC ECONOMIES
Source: Ministry of Foreign
