Japan has endorsed a historic trade deal with Vietnam to reduce import taxes on the majority of goods traded between the two nations.
The Japanese parliament approved the Vietnam Japan Economic Partnership Agreement (VJEPA) on June 24, allowing the pact to take immediate effect.
The agreement sets a schedule for import tariff reductions over the next 10 years that will apply to a range of sectors, including as agriculture, industry, trade, investment, human resource development, tourism, environment and transport.
Vietnam’s National Assembly endorsed the agreement in May, after officials from the two nations concluded their negotiations on the terms of the trade deal last year.
Under VJPEPA, 92 percent of goods traded between Japan and Vietnam will not attract any import taxes.
Tariffs on as much as 86 percent of aquatic, agricultural and forest products and 97 percent of industrial items Vietnam exports to Japan will also fall.
Japan will slash the tax on cuttlefish and shrimp imported from Vietnam to 1 to 3 percent, while Vietnam’s mineral exports will be levied at zero percent tax.
The trade pact with Vietnam contains the biggest tariff reductions Japan has ever committed to with an Association of Southeast Asian Nations (ASEAN) country.
In return, Vietnam agreed to reduce import tariffs on nearly 88 percent of goods imported from Japan within 10 years.
Import taxes on spare parts for flat screen TVs and DVDs will fall to 3 percent, while the import taxes on digital cameras, color TVs and automobile spare parts will drop to between 10 and 20 percent.
VJEPA is the first bilateral trade deal Vietnam has committed to with another nation since being admitted to the World Trade Organization (WTO) in 2007.
Vietnam-Japan trade turnover reached more than US$15.5 billion last year, with Vietnam’s exports to Japan reaching $8 billion and Vietnam importing $7.5 billion of goods and services from Japan.
The two nations have agreed to lift two-way trade to US$17 billion by 2010.
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