EVFTA opportunities for German Beverage products
Vietnam is one of the most dynamic markets for alcoholic beverages in Asia. Vietnam is in the top 15 countries consuming beer in the world and ranked 3rd in Asia with 43 liters/person/year. Vietnam’s alcohol consumption is increasing with an average annual growth rate of 5.3% for the period 2013-2018 (French Chamber of Commerce and Industry in Vietnam, 2019). In addition, Vietnamese people are increasingly interested in the quality and prestige of alcohol brands. Therefore, alcoholic beverages from Europe, including Germany, are increasingly favored by Vietnamese consumers. Especially, with many famous beer brands in the world, Germany is currently the EU country where Vietnam imports beer the most. In the future, the EVFTA is expected to help increase the export of German beverage products to Vietnam thanks to the following benefits:
Benefits from tariff reduction: Vietnam currently maintains relatively high MFN tariffs on beverage products, especially beer and wine. Specifically, the average MFN tariff in 2020 for beer products was 35%, for alcohol products was 45-55%. In the EVFTA, Vietnam committed to eliminating tariffs for wine and spirits after 7 years and for beer after 10 years.
Benefits from protection of Geographical Indication
Germany has 12 geographical indications automatically protected under the EVFTA, of which there are 9 GIs that are alcoholic beverages (beer, wine and spirits), including:
1. Bayerisches Bier – Beer
2. Münchener Bier – Beer
3. Korn/Kornbrand - Spirit
4. Franken – Wine
5. Mittelrhein – Wine
6. Mosel – Wine
7. Rheingau – Wine
8. Rheinhessen - Wine
9. Genièvre/Jenever/Genever - Spirit
German beer products that are protected by geographical indications will have a better chance of accessing the Vietnamese market: being protected, known and increasing brand value.
EVFTA full text for more information: https://wtocenter.vn/chuyen-de/12778-eu-vietnam-trade-and-investment-agreements
Source: "Business Handbook: Exploiting the EVFTA to import and export goods between Vietnam and Germany" - Center for WTO and International Trade
