New FTAs put pressure on VN to reform business practices

New FTAs put pressure on VN to reform business practices

HCM CITY — New-generation Free Trade Agreements (FTAs) are expected to help Việt Nam become more competitive if the country reduces trading costs and improves its business environment, experts said yesterday at a conference in HCM City.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Việt Nam FTA (EVFTA) trade deals will have a significant impact on the economy, according to Phạm Bình An, director of the HCM City International Integration Support Centre.

The CPTPP and EVFTA could help increase Việt Nam’s GDP by  四. 三 per cent and  一. 三 per cent, respectively, by  二0 三0, he said. 

Shipments to the EU are expected to surge by about  四 四  per cent by  二0 三0, while those to CPTPP-member states are expected to rise by  一 四. 三 per cent by  二0 三 五, according to An.Moreover, the two trade agreements will put pressure on the Government to improve institutional governance as well as the business climate because of requirements included in the FTAs.

As of last year, Việt Nam had  一 七 FTAs with  六0 countries, all of which offer the country a chance to transform its economy.

Besides increasing exports, FTAs have helped to promote administrative reform, improve infrastructure, and ensure equality in accessing resources. 

Ngô Thanh Phong, lecturer at Tiền Giang University, said that FTAs had created opportunities to participate in global supply chains, but Việt Nam must speed up administrative reform and improve its investment environment, especially in the context of increased protectionism internationally. 

Between  二0 二 一 and  二0 二 五, the country’s gross domestic product (GDP) is forecast to rise to  七 per cent on the back of new-generation FTAs, according to the Ministry of Planning and Investment’s National Centre for Socio-Economic Information and Forecast.

Vũ Tiến Lộc, chairman of the Việt Nam Chamber of Co妹妹erce and Industry (VCCI), said that Việt Nam’s economic openness was ranked behind Singapore among ASEAN members, but its competitiveness and capacity for integration were still low.

In the  二0 一 八 Global Competitiveness Report by the World Economic Forum, Việt Nam  ranked   七 七th out of  一 四0 countries. It placed  九 九th for institutional competitiveness and  一0 一st in business competitiveness.

Experts noted that Vietnamese products have advantages in certain markets such as the EU, which has little direct competition with Việt Nam. However, to make the most of their position, local businesses must meet the EVFTA’s requirements on environmental standards, labour relations, product origin, and sustainable development. 

At the conference,  二0 out of  五0 scientific papers received from  二 二 universities nationwide were chosen by the conference’s Scientific Council to be published in the  二0 一 九 yearbook of the HCM City Banking University. 

The event, organised by the university in cooperation with the HCM City Youth Science and Technology Development Centre, offered researchers, economic experts and scholars a chance to exchange views on how new-generation FTAs will affect Việt Nam’s economy. — VNS