Policy Comment: Unraveling the Rice Varietal Dilemma within the EU-Vietnam Trade Agreement

The EU-Vietnam Free Trade Agreement (EVFTA), effective on 1 August 2020, provides Vietnam with a tax-free quota of 80,000 t of rice annually. However, a significant portion of Vietnam’s rice exports to the EU fail to qualify for this quota because the outdated varietal list in the EVFTA does not align with changing consumer demands in the EU market. This misalignment resulted in significant losses in potential revenue and has hindered Vietnam’s competitiveness. This policy comment proposes a framework to ensure that the Vietnamese rice industry can capitalize on the EVFTA by regularly updating the varietal list to reflect current EU market preferences and by categorizing rice based on grain types. This approach will enable Vietnam to maximize the benefits of the annual quota worth EUR 11.8 million (USD 12.7 million) and enhance its competitiveness in the EU market. Moreover, this framework can be adopted by other rice-producing countries as a blueprint for developing adaptable FTAs, ensuring that they can fully capitalize on the benefits of these agreements.