Economic and Trade Agreements

Vietnam signed a Trade and Investment Framework Agreement (TIFA) with the United States in June 2007. Vietnam has negotiated bilateral agreements on trade with Mozambique, Namibia, Democratic People’s Republic of Korea (North Korea), Nigeria, Pakistan, Tanzania and South Africa. Vietnam also has a free trade agreement with Korea (Rep.) and Chile, as well as an Economic Partnership Agreement with Japan.

Vietnam is a member of the ASEAN Free Trade Area (AFTA), which was initiated in 1992. AFTA seeks to eliminate tariff barriers among the ASEAN countries, and the key to this is the Common Effective Preferential Tariff (CEPT) Scheme, under which tariffs are gradually reduced to 0-5% by 2010 or 2015.

Vietnam is also a signatory to the ASEAN Framework Agreement on Services (AFAS) which is aimed at strengthening the cooperation among service suppliers in the ASEAN region, the reduction of restrictions to trade in services and to progressively liberalize trade in services among ASEAN countries. In addition, Vietnam is also a party to the Framework Agreement on the ASEAN Investment Area (AIA), which is aimed at establishing the ASEAN region as a competitive investment area by 1 January 2010, and a liberal and transparent investment environment and free flow of investments in the region by 2020.

As a member of ASEAN, Vietnam is a party to the following:

• the ASEAN-China Free Trade Agreement, under which a zero tariff market took effect for the ASEAN-6 on 1 January 2010, and is expected to be achieved by 2015 for the rest (including Vietnam);
• the ASEAN-Korea Framework Agreement on Comprehensive Economic Cooperation, under which tariffs on 90% of products were eliminated as from 1 January 2009. A Free Trade Area for Trade in Goods is intended to be realized by 2012 for the ASEAN-6 and by 2018 for the rest (including Vietnam);
• the ASEAN-Japan Agreement on Comprehensive Economic Partnership, under which tariffs on 90% of imports from Japan are expected to be eliminated by the ASEAN-6 within 10 years of the agreement taking effect. A more gradual tariff elimination table has been set for the remaining four ASEAN members (including Vietnam);
• he ASEAN-India Framework Agreement on Comprehensive Economic Cooperation which aims to establish an ASEAN-India Free Trade Area with five ASEAN members by 31 December 2012 and with the remaining members (including Vietnam) by 31 December 2017; and
• a free trade agreement between ASEAN and Australia and New Zealand.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which is a free trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, was finalized on 23 January 2018 and signed in March 2018 in Chile.

Negotiations for the European Union-ASEAN FTA commenced in May 2007, but were stalled 2 years later. Negotiations on the Regional Comprehensive Economic Partnership (ASEAN members, Australia, China, India, Japan, Korea (Rep.) and New Zealand) commenced in November 2012 and are continuing.