ABOUT FTA

Outcomes

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  • Second Year Outcomes of Korea-Viet Nam FTA
    • The KVFTA has contributed to upgrading bilateral relations between Korea and Viet Nam since its entry into force in December
      2015 by way of additional market-opening and eased rules of origin in comparison to the Korea-ASEAN FTA.
    • Even amid lingering uncertainty in the global economy and other unfavorable export conditions, Korea's exports to Viet Nam increased by 17.6% year-on-year from $27.7 billion in 2015 to 32.6 billion in 2016, while Viet Nam's exports to Korea also went up
      by 27.4% from $9.8 billion to 12.4 billion during the same period. (Source: Korea International Trade Association).
  • Korea-Viet Nam Trade Status by Year
  • ($mill, YOY%)
    year '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17
    K-V value 3,256 3,432 3,927 5,760 7,805 7,149 9,652 13,465 15,946 21,088 22,352 27,771 32,651 47,749
    rise 27.1 5.4 14.4 46.7 35.5 ∆8.4 35.0 39.5 18.4 32.2 6.0 24.2 17.6 46.3
    V-K value 673 694 925 1,392 2,037 2,370 3,331 5,084 5,719 7,175 7,990 9,805 12,495 16,176
    rise 31.8 3.1 33.3 50.5 46.4 16.3 40.5 52.6 12.5 25.5 11.4 22.7 27.4 29.5
    total 3,929 4,126 4,852 7,152 9,842 9,519 12,983 18,549 21,665 28,263 30,342 37,576 45,146 63,925
    rise 2,583 2,738 3,002 4,368 5,768 4,779 6,321 8,381 10,227 13,913 14,362 17,966 20,156 31,573
    • In particular, trade in FTA beneficiary goods, such as consumer goods (e.g. cosmetics), intermediary goods (e.g. auto parts, textile and fabrics) and food (e.g. mangoes), has surged. Exports of Korea's cosmetics to Viet Nam (tariffs 20% → 16% with liberalization over 10 years) increased by 34.9% from $44 million in 2015 to 59 million in 2016 and auto parts (tariffs 15% → 12% with liberalization over 5-10 years) by 29.6% from $301 million to 389 million over the same period.
    • Likewise, exports of Viet Nam's mango to Korea (tariffs 30% → 24% with liberalization over 10 years) saw a rise of 80.1% from $700,000 in 2015 to 1.3 million in 2016 and rice paper (tariffs 8% → 2.7% with liberalization over 3 years) by 8.9% from $5 million to 6 million over the same period. Exports are expected to further expand between Korea and Viet Nam, boosted by additional tariff reduction or elimination going forward.
  • Korea-Viet Nam Trade Status by Product in 2016
  • ($mill, YOY%), 4-digit MTI
    ranking Korea -> Viet Nam Viet Nam -> Korea
    product value rise product value rise
    1 Integrated circuits semiconductors (8311) 8,642 112.3 radio telecommunication parts (8128) 2,870 38.7
    2 Flat panel displays (8361) 7,352 196.9 Textile garment (4412) 1,928 15.1
    3 Radio telecommunication parts (8128) 3,205 ∆36.0 Radio-telephones (8121) 844 154.0
    4 Printed circuits (8343) 2,099 63.8 Knitted garment (4411) 830 20.7
    5 Gasoline (1331) 1,849 91.6 Footwear (5212) 783 24.6
    6 Synthetic regins (2140) 1,442 19.8 Flat panel displays (8361) 600 1,075.9
    7 Flat panel displays Manufacturing Equipment(7361) 1,280 1,035.8 Printed circuits (8343) 386 103.6
    8 Machinery(7901) 1,158 186.7 Color TV(8211) 383 13.6
    9 Knitted fabrics (4360) 1,118 3.8 Wood(0319) 296 16.7
    10 Plastic products(3109) 936 69.7 Integrated circuits semiconductors (8311) 289 425.9
      Total 29,081   Total 9,209  
    • Regarding investment, despite the modest increase of Korea's investment to Viet Nam by 5.8% in 2016 year-on-year, the number
      of investments grew by 35.6%. Viet Nam's investment to Korea skyrocketed by 500%.
  • Korea's Investment to Viet Nam by Year (reported)
  • (unit: case, $mill, YOY%)
    year '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17-3Q
    case 635 944 897 703 847 793 814 1,109 1,366 1,702 2,137 1,712
    rise 42.7 48.7 ∆5.0 ∆21.6 20.5 ∆6.4 2.6 36.2 23.2 24.6 25.6 8.0
    value 1,816 2,814 1,934 970 2,226 1,523 1,000 1,476 2,150 2,920 2,993 1,688
    rise 346.2 55.0 ∆31.3 ∆49.8 129.5 ∆31.6 ∆34.3 47.6 45.7 35.8 2.5 ∆43.6
  • Viet Nam's Investment to Korea by Year (reported)
  • (unit:case, $mill, YOY%)
    year '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17
    case 5 7 9 13 15 15 14 7 4 9 11 15
    rise 66.7 40.0 28.6 44.4 15.4 0.0 ∆6.7 ∆50.0 ∆42.9 125.0 22.2 36.4
    value 0.401 0.542 0.432 1 0.792 4 1 2 0.940 1 6 3.5
    rise ∆59.9 35.2 ∆20.3 131.5 ∆20.8 405.1 ∆75.0 100.0 ∆53.0 6.4 500.0 ∆41.7