The Hanoitimes – Vietnam’s supply chain is expected to open up further to increased European business. The signing of the EU-Singapore Free Trade Agreement (EUSFTA) marks a significant moment for the two dynamic economies and for Vietnam, which is currently in negotiations with Europe on a similar free trade agreement (FTA), HSBC Vietnam has said in a statement. The EU has signed an FTA with Singapore, the first of its kind between the EU and an ASEAN nation. EUSFTA opens ASEAN supply chain potential The EUSFTA, which will eliminate virtually all tariffs and lowering non-tariff barriers between Singapore and Europe, will allow for some manufactured goods to have ASEAN cumulation. This means that inputs sourced by Singapore businesses from other ASEAN member states – especially Vietnam – will be considered as domestic content for the determination of the origin of the final product made in Singapore. In other words, certain inputs will come under Singapore’s zero tariff regime with Europe. A high proportion of Singapore products have parts produced in other ASEAN countries. With the rule of ‘ASEAN cumulation’, more Singapore exports produced along intra-ASEAN value chains can benefit under the EUSFTA. This will have a significant impact for Singapore and for the ASEAN region including Vietnam – again in areas like electronics and pharmaceuticals, said Head of Wholesale Banking at HSBC Vietnam Winfield Wong. ASEAN as an aggregate is the largest exporter to Singapore, with Singapore importing US$71.06 billion of goods from ASEAN in 2017. At the moment,… [Read full story]
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