The EU-Vietnam Free Trade Agreement (EVFTA) has brought about a range of opportunities for German investors in Vietnam after it came into force more than one year ago.

Illustrative image (Source: VNA)

The EU-Vietnam Free Trade Agreement (EVFTA) has brought about a range of opportunities for German investors in Vietnam after it came into force more than one year ago.

Alexander Goetz, Chairman of the German Business Association (GBA) in Vietnam, said the deal will give a boost to the Vietnam-EU trade in the coming years.

Vietnam is Germany’s biggest trade partner in the Association of Southeast Asian Nations (ASEAN), he said, adding the GBA hopes that the removal of trade barriers will lead to an increase in investments.

He said the Southeast Asian nation has remained attractive to producers thanks to market advantages, plus the EVFTA. Vietnam is one of the three top destinations for German firms to expand investments in Asia.

Bosch Group, which has operated in Vietnam more than a decade ago and become the biggest German investor in the country, said it will further expand its presence in Vietnam following the agreement.

Managing Director of Bosch Vietnam Guru Mallikarjuna said the EVFTA would promote Vietnam’s efforts in institutional reform, especially in environment, investment protection, labour standards and intellectual property.

During the first year of materialising the agreement, the Vietnamese Government has worked hard to streamline administrative procedures, step up investments in public administration, raise competitiveness of labourers, and perfect legal regulations to support the observance of international standards.

Lukas Schoeneck, CEO at thyssenkrupp Industrial Solutions (Vietnam), also acknowledged great opportunities thanks to tariff reduction and the removal of administrative barriers after the EVFTA was put into place.

The legal system will be adjusted to increase transparency, like that in bidding, he said, expressing his optimism about the deal’s positive impacts on trade and investment ties between Vietnam and the EU.

Schoeneck also believed that there will be more companies to operate in Vietnam in the years to come, and the EVFTA will positively influence the trend.

Statistics by the Ministry of Planning and Investment show that as of August 2021, German investors poured 2.25 billion USD into 405 projects in Vietnam, with major brands such as Bosch, Siemens, SAP, Mercedes-Benz, B. Braun, BASF, Bayer and Deutsche Bank.

Despite COVID-19, a number of German companies have planned to expand their investments in Vietnam, including tesa – a global manufacturer of tapes and self-adhesive solutions, and wpd AG.

According to the GBA Chairman, apart from production, Vietnam has potential for infrastructure and energy development./.