|
Free trade deals cut both ways, says expert
The Free Trade Agreement (FTA) is a double-edged sword as it brings both opportunities and challenges to Vietnamese exports, said economic experts.
Nguyen Minh Phong from the Ha Noi Institute of Socio-economic Development said that the FTA signing has provided Viet Nam with an equal position on all aspects with member countries in the agreement and as a result, the country's exports have seen remarkable improvements in turnover, products and markets year by year, except 2009 when the world suffered an economic crisis.
According to the Ministry of Industry and Trade, Viet Nam's total export turnover reached nearly US$63 billion in 2008, doubling the figure of 2005, and increased to over $71.6 billion in 2010.
The FTA has not only affected Viet Nam 's export turnovers but also helped create impressive increases in economic cooperation between Viet Nam and other countries.
The impacts of the Viet Nam-US Bilateral Trade Agreement (BTA), an agreement similar to the FTA, on the two countries' economic relations were cited as an example.
In 1995, two-way trade between Viet Nam and the US reached only $450 million but rose to $18 billion 15 years later. Viet Nam's exports to the US earned over $12 billion in 2009, ten times higher than the figure of 2002 when the BTA took effect. At present, the US is Viet Nam's largest export market and investor.
After the US, Viet Nam's exports to ASEAN have also remarkably increased with $11 billion in 2010, up 19 per cent over the previous year. The result was attributable to a tax reduction to 0-5 per cent for almost all commodities exported to the ASEAN market as committed in the ASEAN-China Free Trade Agreement, which became effective in early 2010.
Similarly, commitments on tariff preferences in the Viet Nam-Japan Economic Partnership Agreement, which came into effect in October 2009, helped Viet Nam earn $1.2 billion from garment exports to Japan for the first time in 2010, an increase of 20 per cent against the previous year.
Regarding challenges for Viet Nam, Phong noted that the first challenge Viet Nam is facing was the risk of an increasing trade deficit due to weak competitiveness and restrictions on price, technology and product structure.
In 2008, Viet Nam 's trade deficit was $17.5 billion, quadrupling the figure of 2005, and mainly from China, which accounted for over 90 per cent of Viet Nam 's total annual trade deficit since 2005.
In the coming time, Phong said that FTAs would have greater influence on Viet Nam's export activities as the agreements' deep tax reduction roadmaps were approaching deadlines, trade liberalisation would be clearer and technical barriers would will become more diversified and complex.
To overcome this challenge, Viet Nam should speed up its economic restructuring, develop supporting industries, areas and products where it has a competitive edge, and improve its import-export structure and position in the global value chain, he stressed.
According to the Minisry of Industry and Trade, Viet Nam hasn't yet signed a FTA with any single country but joined ASEAN to sign and implement a series of FTAs with six partners in East Asia, including the ASEAN-China FTA, the ASEAN-Korea FTA, the ASEAN-Japan Comprehensive Economic Partnership Agreement, the ASEAN-India FTA, and the ASEAN-Australia-New Zealand FTA.
At present, Viet Nam is joining in negotiations on several other FTAs, including the Trans-Pacific Partnership Agreement, the ASEAN-EU Free Trade Agreement, the Comprehensive Economic Partnership Agreement with Japan, the Viet Nam-Chile Bilateral FTA and the Viet Nam-EU Bilateral FTA.
vietnamnews
|
