Vietnam And South Korea Sign Evfta Fabric Accumulation Origin Agreement

Vietnam's Youth Online reported on December 13 that Vietnam and South Korea have signed the Vietnam EU free trade agreement (evfta) cloth accumulation origin agreement.

According to the Ministry of industry and trade of Vietnam, this is a particularly important agreement for Vietnamese enterprises to help them use high-quality textile raw and auxiliary materials produced by South Korea, and eliminate the bottleneck of exporting textile fabrics to the European Union, because South Korea has also signed a free trade agreement with the European Union.

According to evfta, in addition to meeting strict quality standards, enterprises must also guarantee strict origin requirements in order to enjoy the preferential tariff reduction. Among them, the origin rule of "starting from cloth" requires that the fabrics used for clothing must be woven in Vietnam or EU Member States.

According to the data of Vietnam's Ministry of industry and trade, the EU is the market with the largest demand for textiles and clothing, with an annual import volume of more than 250 billion US dollars. However, Vietnam's textile and clothing exports to the EU are still very small, with the export volume of only 4.3 billion US dollars in 2019, accounting for 2% of the EU market share.

Experts estimate that if the evfta comes into effect, Vietnam's textile and garment exports to the EU will increase by about 67% by 2025 compared with that before the signing of the evfta.

It is very necessary to make use of the above-mentioned trade and industry agreement with Vietnam to solve the difficulties of Vietnam's textile industry and trade enterprises in a timely manner.