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Firms ’overly-optimistic’ on EVFTA

Vietnamese firms are “overly-optimistic” about labour conditions regulated in the EU-Việt Nam trade agreement, a Vietnam Chamber of Commerce and Industry (VCCI) official said.

High international standards for labour, including a demand for independent unions, were what set apart the European Union-Việt Nam Free Trade Agreement (EVFTA) with other FTAs Việt Nam has signed.

During a workshop on the Vietnamese workforce in Hà Nội yesterday in preparation for the EVFTA which is expected to come into effect next year after being ratified by both sides, the VCCI’s World Trade Organisation Centre Director Nguyễn Thu Trang said that she feared Vietnamese firms were being too optimistic in perceiving changes the EVFTA would bring to their workforce.

She cited a survey by the VCCI on some 250 businesses across all sectors nationwide last year, of which more than 90 per cent believed that the EVFTA would improve workforce quality.

“The (survey) result was quite astonishing. Higher labour standards of the EVFTA are supposed to make it more difficult for the businesses, yet they had little worries about it,” Trang said.

The reason for such optimism, she added, might lie in the ignorance of the business community about the trade agreement.

The same survey shows that up to 83 per cent of the surveyed businesses had heard about the EVFTA, but only about 8.5 per cent knew it well, she said.

While a lack of knowledge might leave enterprises unprepared for the deal, others who were trying to get prepared were faced with a crippled labour training system, Trang added.

The Institute of Labour Science and Social Affairs head Đào Quang Vinh said that the labour structure in Việt Nam was going in the opposite direction from the rest of the world.

“Normally those with higher education would be less in number than skilled workers in a labour pool,” Vinh said.

“But Việt Nam has the opposite situation.”

Worse still, the number of labourers without any training is only decreasing at a very slow pace.

Việt Nam had about 82.6 per cent of its workforce untrained in 2007, and only managed to bring the number to 79 per cent in 2016, according to Vinh. This was equivalent to around 42.9 million of people in the labour pool without any working skills.

Source: Vietnam News

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