Debate: Conclusion of the EU-Viet Nam Free Trade Agreement - Conclusion of the EU-Viet Nam Free Trade Agreement  - EU-Viet Nam Investment Protection Agreement - EU-Viet Nam Investment Protection Agreement
Date: TUESDAY, 11 FEBRUARY 2020
Speaker: Phil Hogan
Language: EN

Can I thank Mr Lange, the Chair of the Committee on International Trade (INTA), Mr Bourgeois, the rapporteur, and all the shadows who have been involved in the scrutiny of this particular deal? To note that the four committee Chairs that are indirectly involved in this scrutiny have given their support for the deal. Can I thank former Commissioner, Cecilia Malmström, and the DG TRADE officials for their tremendous work over many years in relation to this deal? As many speakers have said, these are the first trade and investment agreements to be voted on by this Parliament. And I hope that they will receive your approval so that our companies, particularly our SMEs that have been mentioned by many of you, can start tapping into the potential and generate growth and employment. In such uncertain times for global trade, a positive vote of course will send a strong signal in relation to the EU’s commitment to an open and fair trade based on rules and values. I can assure you that we will monitor implementation very closely, because I agree with many of you that there are issues that have to be resolved and will constantly require us to ensure the Vietnam lives up to its commitments. I’m fully aware of these particular sentiments. But, in relation to some of the specifics that we mentioned, horse trade is usually associated with market access, and this has been a very good deal in terms of EU-Vietnamese reciprocity in so many products. Mr Juncker has mentioned issues in relation to food and can I confirm that the Free Trade Agreement liberalises all EU export offensive interests, like beef, pork, poultry, wines, spirits and beer, but it also has safeguards for some of our sensitive issues, like rice, sugar, sweetcorn and canned tuna. These safeguards are a new dimension in relation to our free trade agreements in recent years, which includes for the first time a free trade agreement that we are ratifying where safeguards are given in respect of tariff rate quotas (TRQs). We have also got recognition by Vietnam in this deal for the European Union to be treated as a single entity for sanitary and phytosanitary terms, which will reduce a lot of the non-tariff barriers that we have. Equally, our 169 geographical indications right around the European Union have been protected. On the trade and sustainable development (TSD) chapter, improving the implementation and enforcement of all our agreements is very important, and this is a key priority for the Commission. Vietnam is a good example of where they are making considerable efforts even before the deal has been implemented in relation to TSD matters, with important progress being made. So the pressure that you’ve applied is certainly bearing fruit. But we have also established an institutional structure through the domestic advisory groups, which will include all stakeholders, including NGOs, civil society, businesses and all the services that will have an input in relation to the implementation of this agreement. The implementation is very important. That’s why we’re establishing as well in the Commission a chief trade enforcement officer during the course of the next few months. The new labour code, which was adopted in November 2019, recognises the principle of freedom of association possibly to set up independent trade unions at enterprise level, as I mentioned earlier, which is outside the scope of the dominant Vietnam general confederation of labour. So Vietnam has started the implementation. It has a master plan that’s going to be implemented by January 2021 and one of the aspects is to check its consistency with all other legal documents, including the penal code and the criminal code. The ILO Conventions has said that six out of eight are implemented. We’re at the same stage as we were in terms of the implementation of this agreement with Japan. So I think this is good progress by Vietnam. Vietnam has started preparations to set up these independent civil society organisations, and last week they gave me an action plan and a timescale in relation to their implementation. I mentioned child labour. There has been a 40% reduction since 2012 and of course they are committed to a new action plan to eradicate poverty over the 2021—2025 period. Some Members have mentioned human rights, and rightly so. It does remain an area of concern in our relationship with Vietnam, but we must take into account where the country has come from and see clear evidence of progress in the last 25 years, notably in the socioeconomic domain. Human rights improvements are central to our engagement, and there’s a binding and enforceable link between the FTA, investment protection agreement (IPA) and the partnership and cooperation agreement (PCA) that allows for total or partial suspension of the agreement in case of systemic or severe breaches on human rights. We also have an annual human rights dialogue and there’s a meeting next week in Hanoi so these are all, I think, positives. There are divergences between us and I’m not saying anything otherwise, but we are convinced that the agreements provide an initial platform to engage with Vietnamese society and governments on these issues. This is the view of several Vietnamese NGOs who say that the implementation of this agreement would open more space for civil society. Now clearly Ms Daly and Mr Wallace have not heard those particular voices in relation to that part of the deal. The EU is of course also closely concerned about political prisoners and persons of concern. We have a list of persons of concern that we have been regularly raising in our exchanges at the highest level. And we are striving to make sure that the EU delegation are not only consistently ensuring that these people are released, but also attending trials, meeting family members and providing the best possible facilities for the families of these political prisoners. The FTA and the IPA will create another important and conducive environment to ensure that these issues are not put under the table, but are consistently high on the agenda. The lack of ratification of the agreement would leave the European Union with no instrument at all to support a reform agenda for Vietnam, and we will push Vietnam closer to other partners that do not necessarily share the same values if we don’t have this agreement. The institutional set up again, as I mentioned in the context of various fora to speak about these issues, is very important. Environment was mentioned: of course Vietnam is one of the countries that are most affected by climate change. So surely they are interested in implementing the Paris Agreement, which they have signed up to. And, under the trade and sustainable development chapter, this is explicitly mentioned. So their national determined contributions are going to ensure, like other partners around the world where we do deals, that are going to have to implement this in a legally binding way, as they have signed up to in relation to the Paris Agreement. So this is another win and another example of where we are providing the framework where we can implement, through this free trade agreement, the necessary leverage to ensure that these commitments are met. Vietnam has also concluded with the EU a forest law enforcement, governance and trade voluntary partnership agreement (FLEGT VPA), which has been enforced since 1 June 2019. And this particular partnership agreement aims to ensure that all timber products imported into the European Union from Vietnam are legal. This is very significant as Vietnam is a major processing hub, importing timber from over 80 countries, including from a number of high-risk countries in the region such as Cambodia. Under the VPA, Vietnam has to introduce mandatory due diligence obligations for its importers. Vietnam is currently working on the implementation of this particular scheme through the various licences that will have to ensure traceability. So our one major success in this field has been the open and constructive participation of all the relevant stakeholders in Vietnam during the negotiation phase. These are the issues that have come to the fore and we have got a response. We have to continue ultimately of course to reach our final destination and our objectives. Finally, on this issue in relation to concern about the investment court system, following the European Parliament’s demands, the investment protection agreement with Vietnam includes the most modern and reformed investment protection framework in any agreement with an investment court system for the resolution of investment disputes, replacing the traditional investor-state dispute settlement (ISDS) arbitration mechanism, and this has been confirmed as the proper way to go by the European Court of Justice decision that was recently made. So all of the elements of the ISDS under CETA are included in the IPA with Vietnam, which is an additional stepping stone towards the establishment of a multilateral investment court. Finally, in conclusion, could I say that, by voting in favour of this free trade agreement, you are voting in favour of a deal that will give us the political and institutional influence and the proper structures to make improvements on issues like human rights, like labour rights, like climate change and like environment policies. By voting ‘no’ you are consigning our influence to resolutions and letters that may or may not be taken into account and will most probably be ignored. This agreement puts the EU and Vietnam together in a political structure and enforcement mechanisms that will deliver common objectives, in particular in the policy areas that have been mentioned in this House. I know that many of these issues have been of concern for many years. Now we have a structured way in which we can deal with these issues. So it is time to be positive, to acknowledge that the EU stands together with the people of Vietnam, and vote positively for this deal.