EPA EU signs trade deal with Vietnam EU banks on more access to 90 million consumers in Vietnam.

The European Union announced a trade deal with Vietnam on Tuesday, just days after talks for a sweeping trade deal between Asia and the U.S. broke down.

“It is not a competition [with the U.S.], we have negotiated this deal for two-and-a-half years and it is much easier to negotiate with just one country,” said Cecilia Malmström, the EU trade commissioner.

The deal with Vietnam — an agreement in principle, which still has to clear a few technical hurdles — will remove nearly all tariffs on trade and should “provide significant new opportunities for companies on both sides, by increasing market access for goods and services” with Vietnam, a country of 90 million inhabitants, Malmström said.

More detailed negotiations of technical issues, final legal texts, translations and approval by the Council and European Parliament mean the agreement will not come into effect until late 2017 or early 2018.

One aspect that still has to be finalized is how to make provisions for investment protection and dispute settlement, which is also the most controversial element of Europe’s ongoing free trade talks with the U.S. The Commission is working on a new multilateral court system to replace the old provisions, which Malmström expects to be finalized this fall.

The deal with Vietnam will eliminate custom duties, reduce non-tariff barriers, protect European geographical indications and allow EU companies to bid for Vietnamese public contracts.

For the first time in such a deal, Vietnam has accepted the marking of origin “Made in the EU” for non-agricultural goods, except pharmaceuticals.

The pact also includes a chapter on human rights that allows for trade suspension in the case of major violations.

While Brussels has followed a bilateral approach with Vietnam and other Asian countries, the U.S. is negotiating a Trans-Pacific partnership with 12 Asian nations plus Canada. Talks began almost 10 years ago but broke down in Hawaii last week.