Non-Tariff Measures in the European Union-Vietnam Free Trade Agreement: Opportunities and Challenges for Vietnam’s Garment and Textile Exports

Abstract

This paper provides a SWOT analysis of implementation of European-Vietnam Free Trade Agreement (EVFTA)’s non-tariff measures (NTMs)and makes policy suggestions for the Vietnamese government and businesses on the way forward. Research results confirm that Vietnamese garment and textile businesses have gained significant benefits in terms of improved competitive advantage from tariff elimination, more opportunities to expand the EU market share, attracting foreign direct investment on domestic supporting industries, and upgrading modern and environmental-friendly technologies.
However, they are also facing challenges, especially requirements on technical barriers to trade, sanitary and phyto-sanitary measures, and rules of origin. It is recommended that the government should formulate long-term strategies and directions on investment in raw material production, facilitating localization of raw materials, encouraging changes to higher value-added processes in the value chain, promoting trademarks based on advanced technologies, improving quality assurance, protection of labor rights and environment. Meanwhile, Vietnamese businesses should actively enhance competition capacity through strengthening workers’ qualification and skills, diversifying products, and improving marketing
and promotion activities.