The ASEAN Japan Centre (AJC) co-hosted a seminar titled “The Free Trade Agreements (FTAs) Utilization Seminar for the promotion Vietnam – Japan trade” with the Vietnam Chamber of Commerce and Industry (VCCI) and Vietnam Trade Promotion Agency (VIETRADE) in Hanoi, Vietnam on 7th of December 2023.
The ASEAN-Japan Centre is committed to promoting trade between ASEAN and Japan including Vietnam, by facilitating the use of FTAs, especially for Small and Medium Enterprises (SMEs).
The AJC conducts FTA utilization promotion seminar in collaboration with government support agencies and chamber of commerce and industry, based on various information surveys, with the aim of promoting trade for SMEs. The AJC will also continue to strive to promote the utilization of FTAs through follow-up of the seminar.
There are four FTAs available between Vietnam and Japan, and Japan is a potentially promising market for Vietnam in many areas. （VCCI）
Currently, four bilateral and multilateral FTAs between Vietnam and Japan are available: the ASEAN-Japan Comprehensive Economic Partnership (AJCEP) agreement, the Vietnam-Japan Economic Partnership Agreement (VJEPA), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTTP), and the Regional Comprehensive Economic Partnership (RCEP) agreement. The trade relationship between Vietnam and Japan has been developing sustainably for many years. Japan is a potentially promising market for Vietnam in many areas.
Each FTA between Vietnam and Japan is an important framework for promoting bilateral trade and investment. (VIETRADE)
Trade between Vietnam and Japan is complementary, and there is no direct competition. Vietnam’s main exports to Japan are garments, machinery and equipment and their parts, transport equipment and their parts, wood and wood products, and seafood. On the other hand, Japan’s main exports to Vietnam are machinery, iron and steel, plastics, scientific optical equipment, etc. Each FTA concluded between Vietnam and Japan is an important framework for promoting bilateral trade and investment.
RCEP is often used for the export of garments due to its relaxed rules of origin. (Mr. Yoshioka, ITI）
When comparing the tariff rates of FTAs between Vietnam and Japan, the overall tariff rate is 1.8% for VJEPA and 1.9% for AJCEP. CPTTP has the lowest tariff rate among the four FTAs, and RCEP has the highest tariff rate at 2.7%; however, it is utilized because of its relaxed rules of origin-only one process of making clothes from fabric satisfies the rules of origin.
The actual effect of utilizing FTAs arises in the price competitiveness of products in the country where they are imported through FTAs. (Mr. Asano, ex-OCCI)
By utilizing FTAs, producers and exporters can benefit from tariff reductions and eliminations, while the cost burden of importers is significantly reduced. The actual effect of utilizing FTAs can be said to arise in the price competitiveness of products in the importing country.
Through the reduction and elimination of tariffs by utilizing FTAs, producers and exporters can improve the price competitiveness of their products and enjoy the benefits of further sales expansion. Strategic responses are significant for companies, especially SMEs confronting international competitiveness. AJC will continue to work on various problem-solving efforts for companies to facilitate FTA use through follow-up of the seminar.
The Free Trade Agreements (FTAs) Utilization Seminar for the promotion Vietnam-Japan trade
Date: Thursday, 7th of December 2023 9：00 AM－12：00
Organizer: ASEAN-Japan Centre
Co-Organizers: Vietnam Trade Promotion Agency (VIETRADE), Vietnam Chamber of Commerce and Industry (VCCI)
Supporter: Ministry of Economy, Trade and Industry (METI), Japan
Venue: VCCI Hall No.1
Participants: 76
Media Coverage: 4 companies
Speakers:
Ms. Nguyen Thi Thai Li, Deputy General Director, International Relations Department, VCCI
Mr. Hoang Minh Chien, Deputy Director General, VIETRADE
Mr. Takeomi Yoshioka, Lead Researcher, Institute of International Trade and Investment (ITI)
Mr. Ryoji Asano, Former Director, Osaka Chamber of Commerce and Industry
Ms. Nguyen Thi Thu Trang, Director of Center for WTO and International Trade, VCCI
Mr. Tetsushi Yoshikawa, Deputy Director General for Trade Policy, METI Japan （Video message）
Mr. Yasushi Ishida, Assistant Director, AJC
