Vietnam and Israel Forge Free Trade Agreement
Vietnam has achieved a significant milestone by becoming the first Southeast Asian nation to sign a free trade agreement (FTA) with Israel. The Vietnam-Israel Free Trade Agreement was signed during the official visit of Deputy Prime Minister Tran Luu Quang to Israel on Tuesday. The agreement encompasses various areas such as trade, services, investment, customs, and legislation, as stated by the Ministry of Industry and Trade.
Under the agreement, duties on Vietnamese products will be gradually reduced, eventually eliminating tariffs on at least 86% of Vietnamese goods and 93% of Israeli products. The two countries aim to increase bilateral trade turnover from $2.2 billion in the previous year to $3 billion in the near future.
The FTA holds immense potential for Vietnamese businesses, enabling them to export goods and access the Israeli market, including goods and technology, at more competitive costs. Additionally, Vietnamese enterprises will find it easier to enter other markets in the Middle East, North Africa, and South Europe. Conversely, Israeli businesses will gain access to the ASEAN region, the Indo-Pacific, and other major economies that Vietnam has signed FTAs with.
This newly signed FTA marks the first agreement between Vietnam and a West Asian country. Israel currently stands as Vietnam’s third-largest export market and fifth-largest trading partner in West Asia. The trade turnover between the two countries reached $2.2 billion last year, reflecting an 18% increase compared to 2020.
Vietnam has already signed 16 bilateral and multilateral FTAs, contributing to a record-breaking trade turnover of $732.5 billion in 2022, a 9.5% increase from the previous year. The country is also engaged in negotiations for three additional FTAs, namely Vietnam-UAE, Vietnam-EFTA (with Switzerland, Norway, Ireland, and Liechtenstein), and the ASEAN-Canada FTA.