Opportunities from new-generation free trade agreements (FTAs) help Vietnam increase tens of billions of USD each year from exports to CPTPP and EVFTA member countries.
Vietnam has signed and implemented many new-generation FTAs, such as CPTPP, EVFTA and UKVFTA. Last month, a free trade agreement with Israel - the first country in West Asia - was also signed, bringing the opportunity to reduce up to 92% of tariffs for Vietnamese goods exported to this country.
In a recent report sent to the Government, the Ministry of Industry and Trade said that free trade agreements have a positive impact on Vietnam's exports, imports and investment attraction. In 2022, trade turnover with CPTPP countries increased by more than 14% compared to 2021, reaching 104.5 billion USD. Of which, Vietnam's exports to CPTPP member countries recorded positive growth, such as Canada by more than 20%, Brunei by 163%.
With the EVFTA, last year, trade between Vietnam and European Union (EU) countries reached more than 62.2 billion USD, an increase of over 9% compared to 2021. EU countries imported nearly 47 billion USD worth of Vietnamese goods last year, an increase of nearly 17% compared to a year earlier.
Particularly with the UK, in 2022 Vietnam had a trade surplus of more than 5.3 billion USD with this country after more than a year of the UKVFTA agreement taking effect.
Workers at Dony Garment Company factory (Tan Binh district, Ho Chi Minh City), October 2021. Photo: Quynh Tran
New generation FTAs bring Vietnam tens of billions of USD each year from exports, but the implementation of these agreements still has many problems, according to the Ministry of Industry and Trade. Currently, the rate of Vietnamese enterprises taking advantage of incentives from FTAs is still low, such as CPTPP is nearly 5%, EVFTA is nearly 26% and UKVFTA is about 24%.
The FDI sector still accounts for the majority when exporting large-value items, while domestic enterprises mainly process or export raw materials and semi-finished products.
Many new enterprises have only participated in some stages of the supply chain, but their ability to meet requirements on quality, food safety, and export techniques is limited, especially in the context of many countries increasing technical barriers and non-tariff barriers. Therefore, the number of Vietnamese enterprises that have built export brands to FTA markets is still limited. In addition, the connection between enterprises is still loose, and unfair competition such as product dumping is common.
To address existing problems and take advantage of the benefits of FTAs, the Ministry of Industry and Trade recommends considering allocating separate capital to support businesses in taking advantage of FTAs. Accordingly, the State Bank and ministries and sectors will work with commercial banks to have appropriate credit sources and preferential interest rates to support businesses that want to improve their production capacity. At the same time, businesses themselves need to increase access to green credit sources to promptly meet the increasingly high standards of export markets.
The Ministry of Industry and Trade and localities will pilot the development of ecosystems, first in 1-2 sectors and industries in each province, to take advantage of opportunities from FTAs. The agency also proposed that the Government have a comprehensive policy, creating conditions for businesses to access and use "intra-bloc" raw materials, meeting the origin criteria according to the regulations of each trade agreement.
Source link
Comment (0)