CPTPP – opportunity for Vietnam to join global value chain
Updated : Saturday, November 03, 2018 9:30 AM (GMT+0700)

TheComprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP),to be submitted to the 14th National Assembly for approval onNovember 2, is expected to help Vietnam expand exports and join the globalvalue chain more deeply. 

 
Illustrative photo - Photo: VNA

Experts have said Vietnam willface challenges caused by impacts of foreign investments on domestic firms.Vietnamese businesses should make preparations in order to make the best use ofincentives offered by the deal. 

Minister of Industry and TradeTran Tuan Anh said the CPTPP is a quite comprehensive agreement as it coversprinciples not only in trade and investment but also in intellectualproperty. 

It requires Vietnam to reforminvestment and business environment, as well as institutions, he said. 

The minister added theagreement will put competitive pressure on enterprises and the economy, helpingVietnam grow more sustainably. 

Pham Quynh Mai, deputy head ofthe Ministry of Industry and Trade (MoIT)’s Multilateral Trade PolicyDepartment, said 66 percent of tariff lines will be eliminated immediatelyafter the agreement takes effect, 86.5 percent three years after the deal comesinto force and 97.8 percent after 11 years. 

It targets not onlytraditional sectors like goods, services and investment but new realms such ase-commerce, public procurement, labourt and the environment, the officialnoted. 

With a market of nearly 500million people and 13.5 percent of global GDP, the CPTPP is a free tradeagreement with strategic significance to Vietnam and the business community, asit will push for open markets, investment development and the establishment offree trade ties between Vietnam and many new partners like Canada, Mexico andPeru, thus helping restructure the country’s export markets, easing itsdependence on traditional markets. 

Besides, the deal willmotivate the Vietnamese Government to step up administrative reform, completethe legal and institutional framework and create a more open and transparentinvestment and business climate, Mai said. 

A survey conducted by HSBC insix out of 11 CPTPP member countries, namely Australia, Canada, Malaysia,Mexico, Singapore and Vietnam, revealed that about 63 percent of Vietnameseenterprises believe the agreement will positively impact their business. 

Minister Anh said experiencefrom Vietnam’s joining the World Trade Organisation (WTO) and the Vietnam-USBilateral Trade Agreement shows that Vietnam can limit adverse impacts if thecountry knows how to utilise opportunities and take initiative in realising itsintegration commitments. 

He stressed that such sectorsas services, post and telecommunications, e-commerce, garment-textile andleather and footwear are forecast to grow under the CPTPP. 

On the contrary, the sugarcanecultivation and sugar industry is expected to face great challenges due to itsslow pace in restructuring, he said. 

Luong Hoang Thai, head of theMultilateral Trade Policy Department, also pointed out challenges regardingquality of exports and high-quality labour force, saying fierce competitionwill take place not only in markets of CPTPP member countries but also inVietnam. 

Given this, experts suggestedVietnamese businesses learn more about the agreement to grasp Vietnam’scommitments and markets of partners, while building and changing their businessplans for mid and long terms. 

Besides, they should seekpartners in other CPTPP member markets to benefit from their financial strengthand technology transfer, thus gaining more opportunities to integrate moredeeply in regional and global supply chains, the expert said.

Source:VNA

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