South Korea and Vietnam have recently engaged in developing their political and economic ties; the zenith of which was reached with the signing of a bilateral Free Trade Agreement (“FTA”) between the two countries on May 5th, 2015 in Hanoi. The FTA is expected to bring exponential surges in the bilateral trade between the two countries, in which the Vietnamese government has agreed to remove tariffs on 89.9% of products imported from South Korea over a period of 15 years. Likewise, South Korea is planning to revoke tariffs on 95.4% of all products imported from Vietnam. The two partners are currently ratifying the agreement before it is due to take effect late this year.
The both countries anticipate further growth in the volume of bilateral trade, which has reached a record high of US$30 billion in 2014. Additionally, with the agreement in place, Vietnam foresees substantial inward investment growth from South Korea which stood at approximately US$5.8 billion in November 2014.
By Vietnam Law Insight (LNT & Partners)
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