ACADEMY OF POLICY AND DEVELOPMENT INTERNATIONAL SCHOOL OF ECONOMICS & FINANCE GRADUATION THESIS Effects of the European Union (EU) - Vietnam Free Trade Agreement (EVFTA) on export activities to the European Union market of Vietnam textile and garment industry Supervisor: Ph. Pham My Hang Phuong Student’s name: Nguyen Thi Nhat Lan Student ID: 5083106511 Class: KTĐN CLC 8.1 Hanoi, 2021 ACADEMY OF POLICY AND DEVELOPMENT INTERNATIONAL SCHOOL OF ECONOMICS & FINANCE GRADUATION THESIS Effects of the European Union (EU) - Vietnam Free Trade Agreement (EVFTA) on export activities to the European Union market of Vietnam textile and garment industry Supervisor: Ph. Pham My Hang Phuong Student’s name: Nguyen Thi Nhat Lan Student ID: 5083106511 Class: KTĐN CLC 8.1 Hanoi, 2021 ACKNOWLEDGE This report would never have been possible without the consistent support and assistance of the people whom I approached during the various stages of writing this essay. Firstly, I would like to express my heartfelt gratitude to my academic supervisor Mrs.
Hang Phuong lecturer of Academy of Policy and Development, for her valuable advice, encouragement, direction, and assistance. Writing this essay would have been impossible without her guidance. Next, I thank the ISEF teachers for their help and teach me valuable knowledge for 4 years. That really helps me to complete the essay and use the skills I have learned to analyze more clearly and in more detail.
"Effects of the European Union (EU) - Vietnam Free Trade Agreement (EVFTA) on export activities to the European Union market of Vietnam textile and garment industry." is a scientific research project under the guidance of the instructor, Ms. Pham My Hang Phuong – Lecturer at Academy of Policy and Development. The figures and results presented in the report are completely honest. All rationales for the research paper are fully cited with clear sources.
I take full responsibility before the department, faculty and school for this commitment. Hanoi, June 1, 2021 The author of the topic Nguyen Thi Nhat Lan Contents PREFACE .The urgency of the research subject .Objectives of the research .Structure of the thesis. 10 Chapter 1: Overview of the free trade agreement and textile value chain. Overview of the free trade agreement.
The concept of a free trade agreement. General features of trade agreements. Some terms used in free trade agreements. The effects of free trade agreements in general.
Some theories on export activities and the value chain of the textile and garment industry. Overview of export activities. Overview of the value chain. 19 Chapter 2: Overview of the EVFTA and the value chain of Vietnam's textile and garment industry.
General overview of the EVFTA agreement. The concept of EVFTA agreement. Progress of the EVFTA agreement. Basic contents of the EVFTA agreement.
Impacts of EVFTA on export activities. Value chain of Vietnam's textile and garment industry. General comments on Vietnam's textile and garment industry. The position of Vietnam's textile and garment industry in the global textile value chain.
49 Chapter 3: The effects of the EVFTA on exports to the European Union (EU) market of Vietnam's. 52 textile and garment industry. Trade relations between Vietnam and EU. Trade share and growth rate.
Assessment of the current situation of Vietnam's textile and garment industry. The production situation of the textile industry in the country. The export situation of the textile and garment industry in general. Effects of EVFTA on export activities to the European Union (EU) market of Vietnam's textile and garment industry.
87 Chapter 4: Solutions to promote the export of Vietnam's textile and garment industry to the European Union (EU) market. 112 2 List of Figures Figure 1. Value Chain Map - Porter. Basic global value chain map.
Global textile value chain. Value chain of textile production - trading. The graph shows the position and added value of the textile and garment industry value chain. Value of each production method of the textile industry.
Global textile value chain. Error! Bookmark not defined. Correlation of Vietnam's garment exports to the EU in the 2016-2020 period………………………………………………………. Producing the main product groups of the textile industry.
Vietnam's textile and garment export turnover Error! Bookmark not defined. Profits in 2021 of some textile enterprises. Vietnam's textile and garment export turnover. 62 in the first 2 months of 2021.
Import turnover of Vietnam's textile and garment industry. Export market share to the EU market……………………………. Evolution of Vietnam's textile and garment export turnover to the EU Unit: Million USD). EU T&C Business confidence indicator.
Growth Rate of EU-Vietnam Trade (August – February). Growth Rate of the EU trade with Vietnam and extra-EU globally by value (08/19-02/21; 08/20-02/21). Growth Rate of the EU trade with selected Southest Asian Countries by value (08/19-02/21; 08/20-02/21). EU-Vietnam Trade by Volume (Million Ton) and.
Textile and garment market share in Korea of Vietnam and Myanmar. Business Confidence Index in the EU Retail Sector. Export turnover of textiles and garments to France over the months Unit: Million USD. Comparison of export turnover of the textile and garment industry of domestic enterprises and FDI enterprises in the period 2010 - 2019 (Unit: Million USD).
Textile and garment market share in the EU of Vietnam and Myanmar (Source: Textile industry analysis report). Revenue share of EU and Korean markets of some enterprises (Source: Textile industry analysis report). EKC Curve of Textile & Apparel Industry Production. 108 List of Tables Table 2.
Summary of FTAs of Vietnam. Progress of EVFTA agreement .3 – Summary of EU open-door commitments for some important commodity groups of Vietnam. Vietnam Textile and Garment - Comparison between 2000 and 2018…………………………………………………………………………. Products exported to the EU market before and after the effective EVFTA Agreement.
List of a number of Asian countries that compete in textiles and apparel to enjoy EU tax incentives. Importing textiles into EU-28 from main sources. Export market share to the EU market. Estimated garment exports of Vietnam to the EU in 2020.
Estimated categories of garment exports of Vietnam to the EU. Error! Bookmark not defined. Dutch apparel imports from some key supplying markets. Sweden's apparel imports from some major supplying markets.
92 5 List of Abbreviations EVFTA European Union – Vietnam Free Trade Agreement FTA Free Trade Agreement SPS Sanitary and Phytosanitary Measures SWOT Strength, Weakness, Opportunity, and Threat TBT Technical Barriers to Trade VCCI Vietnam Chamber of Commerce and Industry WTO World Trade Organization SWOT Strength, Weakness, Opportunity, and Threat 6 PREFACE 1. The urgency of the research subject In the context of globalization, international economic integration is seen as the key for each country to have the opportunity to participate more deeply in the global value chain, enhance its economic potential and develop the country. Therefore, the proactive and active international integration has made an important contribution to enhancing Vietnam's position in socio-economic development and raising people's incomes, while creating pressure and conditions for economic integration actively improve economic institutions, strive to improve national competitiveness, and develop enterprises. Since August 1, 2020, the EVFTA Agreement has officially come into force after it has been ratified by the National Assembly of the two sides.
It can be said that EVFTA is one of the new-generation Free Trade Agreements that Vietnam has joined, with many deep and broad commitments, including both traditional and non-traditional contents. However, joining the new generation Free Trade Agreement EVFTA will open up great opportunities and challenges for several of Vietnam's import and export industries, including some industries such as textiles and garments, electronics, agricultural products.because Vietnam is a country in the process of participating more deeply in the global value chain. Vietnam's textile and garment industry is one of the key export industries, playing an important role in promoting economic development, so with an annual import scale of over 250 billion USD in textile and garment, the EU is the world's largest textile and garment import market, accounting for 34% of the world's total textile and apparel import turnover, with the total garment demand growing at an average 7 of 3% per year, while the export market share of Vietnam's textile and garment Only accounted for about 2.7%, the room for Vietnam's textile and garment industry to increase exports to the EU market after the EVFTA comes into effect is very promising. In the past time, there have been several research projects on the new generation EVFTA, such as: Topic: The process of coming to the EU-Vietnam Free Trade Agreement (EVFTA) by Nguyen Thu Hanh (2014), an overview of the relationship between Vietnam and the EU, the EVFTA negotiation process, and the prospect of EVFTA with Vietnam.
Besides, the impacts of the free trade agreement between Vietnam and the EU are also analyzed in depth in the topic of the Vietnam - EU Free Trade Agreement: the impact on the two-way goods trade and its implications. for Vietnam by Vu Thanh Huong. Subject: Vietnam - EU Free Trade Agreement: Impact on small and medium enterprises by the author group Nguyen Tuan Viet and Ngo Van Vu (Vietnam Social Science Journal, No. 09 - 2019) points out the basic contents of the EVFTA, positive and negative impacts on small and medium enterprises in Vietnam.
All of the above studies have assessed the impact and predicted the level of influence of the EVFTA Agreement in general. Most of the above studies can only explain issues related to the context, developments and content of the EVFTA Agreement, analyze the impact of the EVFTA Agreement on Vietnam in general. However, there has been no research to analyze the effects of the EVFTA Agreement on important export industries of Vietnam such as the textile and garment industry. Objectives of the research 8 The research project was conducted to propose solutions to promote export activities of Vietnam's textile and garment industry under the effects of the EVFTA Agreement.
Specific objective: Clarifing the overview and practical theory of free trade agreement and global textile value chain. Clarifying the overview and practical basis of the EVFTA agreement and Vietnam's textile and garment value chain. Analyze the effects of the EVFTA Agreement on export activities of Vietnam's textile and garment industry to the EU market. Proposing solutions to promote exports of the textile and garment industry in the context of Vietnam's participation in the EVFTA Agreement.
Time: Data on the current situation of the textile and garment industry is for analysis related to the impact of the EVFTA Agreement in the period from before the Agreement's entry into force to 2021 (2012-2021). Space Effects of EVFTA on export activities to the European Union (EU) market of Vietnam's textile and garment industry. Research methods The article applies scientific research methods including: statistical methods, data collection, analysis and synthesis methods, qualitative methods and SWOT analysis. Data collection method: With statistical method, data collection helps to synthesize economic data of related countries, giving accurate results.
Besides, the data collection method is used to collect secondary data from sources such as: books and newspapers; specialized magazines; proceedings of scientific conferences; reports of research 9 institutions; data on websites of enterprises, ministries, departments, branches, domestic and foreign press agencies. Methods of analysis and synthesis: With the method of statistical analysis and synthesis, the positive and negative aspects are presented, from which conclusions and predictions are made. By analyzing the effects of the EVFTA on export activities to the European Union (EU) market of Vietnam's textile and garment industry, the topic briefly evaluates the research results achieved so that, then, the topic will be discussed. The paper concludes and recommends solutions to promote the supply chain in the textile industry in Vietnam.