European Union retailers hope for a lot from the FTA with Vietnam. It’s expected to boost European growth and job creation in the retail sector. Vietnam is EU retail sector’s second largest source of fast-moving consumer goods after China. There is also a growing interest for investment in retail stores in Vietnam. The scale of the potential gain for the sector is enormous. For EU retail, FTA with Vietnam is more important than the agreements with the US, Canada and Japan combined.

EU retailers currently import eight per cent of fast-moving consumer goods from Vietnam, a figure still well behind the 50 per cent imported from China, but growing fast and set to get a boost from the elimination of tariffs under the FTA, which would lower costs for importers and European consumers. Even without the FTA, EU clothing imports from Vietnam increased by 3.2 per cent in 2015.

Among Vietnam’s key export items, garment and textile exports grew 4.2 per cent year-on-year in the first eight months of 2016 and footwear exports grew 8.1 per cent. The agreement is also expected to boost Vietnam’s development, already considered an exceptional success story, with per capita income rocketing from 100 dollars in 1986 to 2100 dollars in 2015.