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Opportunities from FTAs not be taken advantage of

14:48 | 03/03/2017

VCN- On 28th February 2017, the Deputy Prime Minister, Mr. Vuong Dinh Hue - Head of the Steering Committee of International Economic Integration chaired the first meeting in 2017, assessed the results of operations in 2016 and prepared for tasks this year.

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The Deputy Prime Minister, Mr. Vuong Dinh Hue speaks at the meeting. Photo: Chinhphu.vn.

An ineffective grasp of opportunities

According to Mr. Do Thang Hai, the Deputy Minister of Industry and Trade, Vietnam has entered a new period of integration with the prominent landmarks such as the establishment of the ASEAN Economic Community (AEC) and a series of free trade agreements (FTAs) that Vietnam signed and participated in.

However, the ability of domestic enterprises to take advantage of opportunities from integration remains limited and poor. Mr. Luong Hoang Thai, the Director of the Multilateral Trade Policy (under the Ministry of Industry and Trade) said that AEC had been formed, but Vietnam exports to this region remained unchanged. This phenomenon is of concern, which needs to be further studied.

This is also the requirement that Deputy Prime Minister, Mr. Vuong Dinh Hue raised at the meeting in September 2016.

In this regard, Mr. Thai said that Vietnam had a deep integration with ASEAN but could not take advantage of AEC to export because Vietnam and ASEAN countries all wanted to strengthen the capacity to produce, export and attract investment from regions outside the ASEAN market. The internal trading rate in ASEAN was 25%, but now it is halved.

Regarding subjective causes, Mr. Thai said that the economic structure of Vietnam was relatively similar to the ASEAN countries. It means that "they export what we do".

Besides, the preference leverage index of Vietnamese enterprisea at only 30% show a low capacity of domestic enterprises to take advantage of opportunities from the AEC. The reason is that Vietnamese enterprises want to focus on the domestic market and other markets outside AEC, instead of penetrating into the ASEAN market.

In addition, ASEAN countries have built up trade barriers and this trend will continue in the near future. Therefore, the Government, Ministries and relevant agencies should support domestic enterprises to overcome these barriers.

Focusing on research and forecast

Concluding the meeting, the Deputy Prime Minister, Mr. Vuong Dinh Hue said that in addition to the gain of integration, the process of international economic integration still had some problems and restrictions such as: coordination between State agencies to develop programs and plans for international economic integration was still poor and relevant agencies lacked support for the leading agency in the development of programs and plans to supervise, monitor and evaluate tasks.

In order to accomplish the tasks in the coming period so that Vietnam will be an active member of the free trade agreements, the Deputy Prime Minister, Mr. Vuong Dinh Hue has requested the Steering Committee to coordinate and effectively use technical support groups, advising groups and experts to further strengthen the research and forecast on issues of international economic integration in general and FTAs in particular. Accordingly, Vietnam needs to release policies for international integration in the next 10 years.

opportunities from ftas not be taken advantage of FTAs: Opportunities and challenges for Vietnamese businesses

In 2016 Vietnam signed several new bilateral free trade agreements and began to implement some signed FTAs

Specifically, Vietnam should focus on the following contents: the impact of trade protectionism trends in the Asia-Pacific, the US withdrawal from the Agreement on the Trans-Pacific Partnership (TPP), and policies for Vietnam; the impact of new problems in the AEC from now to 2025 and solutions for Vietnam; issues on non-tariff barriers and trade facilitation in promoting the ASEAN trade; trade promotion with the Middle East countries and African countries that Vietnam has not expanded; and policies on trade defence especially when the National Assembly will discuss and adopt the Law on foreign trade management in the coming time.

By Phan Thu/ Hoang Anh