The agreement was signed by Vietnamese Minister of Industry and Trade Vu Huy Hoang and his Lao counterpart Nam Viyaketh in Hanoi on January 17.

Under the agreement, Vietnam will grant zero tax rate to an additional 16 items of Lao commodities belonging to the groups of car and motorbike engines and components.

Vietnam will give preferential quota to its import of commodities with Lao origin, including cigarette and tobacco blades (3,000 tonnes per year) and rice (40,000 tonnes per year).

Meanwhile, Laos will levy the tax rate of zero on an additional 87 items of Vietnamese commodities that are from the groups of vegetable raw materials, processed fruit, cigarette, apparel, motorbike, and home furniture.

The Ministry of Industry and Trade estimated that the two countries’ import-export value reached US$450 million in 2008, a surge of around 44 percent over 2007.

In the year, Vietnam earned an export value of US$136.4 million, mainly from apparel, coal, electric wire and electric cable, and plastic products, representing a year on year rise of 41.7 percent.
The country imported from the neighbouring country US$259 million worth of metal, timber and wooden products, assembled cars, and tobacco, an increase of 34.2 percent year on year.