Japan And Vietnam Ink Free Trade Accord

by Mary Swire, Tax-News.com, Hong Kong

05 January 2009

Japan and Vietnam have signed a framework agreement for the implementation of a free trade pact which will eliminate import tariffs on 92% of goods and services traded between the two countries for ten years.

The accord was signed by Japanese Foreign Minister Hirofumi Nakasone and Vietnam’s Minister for Industry and Trade Vu Huy Hoang on December 22 and, according to a joint statement, will create the basis for a “mutually beneficial collaboration between [the] two countries by facilitating freer flows of goods, services and investments.”

Exports from Japan to Vietnam in the period of January 1, 2007 to December 31, 2007 totalled USD6.12bn, while exports to Japan from Vietnam totalled USD6.14bn. The accord will eliminate import tariffs on 88% of Japanese goods by value entering Vietnam, while 95% of Vietnam’s products by value will be subject to no import tariffs when exported to Japan. Vietnam will benefit from removal of import duties on farm and marine products. The agreement also removes tariffs from imports of Japanese steel, and components for electronic technology products which are assembled in Vietnam.

In a joint statement the ministers said:

“We are convinced that such economic cooperation will contribute to the economic development of our two countries, promote the well-being of our peoples and expand opportunities and benefits for our business sectors.”

The agreement will not come into force until it has been ratified by both countries.

Japan currently has similar agreements with Switzerland, and is in talks for free trade deals with India, Australia and the Gulf Cooperation Council.

Recommended