High hopes for TPP signing in 2015

TPP negotiation finalization in 2015 is feasible
By the end of 2014, TPP members underwent 19 official rounds of negotiations and many others at chief negotiator and ministerial levels along with high-level meetings.

They had finalized negotiations on cooperation and capacity building; Small and medium sized enterprises (SMEs); For the development, cohesion policy and the environment facilitating the supply chain; Customs; Food safety and animal and plant quarantine; Telecommunications; Competition policy (not including the issue of State-owned enterprises). 

Despite progress made in the negotiations, according to Industry and Trade Minister Vu Huy Hoang, there is still much that needs to be resolved. With the direct participation of ministers, the participating countries have examined ways for the early conclusion of TPP negotiations, Minister Hoang said.

The fact shows that TPP negotiations are entering the final stage. Leaders from the TPP nations, at a meeting on the fringes of the APEC Summit in Beijing in October, 2014, set their sights on finalizing negotiations at an early date. 

"After this meeting, the countries specified the leaders’ guidelines by setting a goal of concluding comprehensive negotiations in 2015 and this is feasible.

 If the negotiation process ends up this year and the TPP Agreement is signed, this will be a good move that is believed to positively impact many areas of our country, especially in trade. However, the big question of major concern is that how the TPP Agreement will affect Vietnam’s import and export activities after it is in effect and what benefits the people enjoy from this pact”, Hoang said.

Minister Hoang analyzed the TPP is a new generation and high-quality free trade agreement (FTA) creating a playground between the economies which contribute 40% of global GDP and account for 1/3 of world trade.

Increasing the competitiveness of Vietnamese goods in the largest export markets through the signing of FTAs is very crucial to Vietnam.

Currently, Vietnam is actively implementing TPP negotiations and preparing for the formal finalization of FTA negotiations with the EU and initialing the FTAs with the Republic of Korea (RoK) and the Customs Union of Russia-Belarus-Kazakhstan. 

FTAs that have been negotiated, notably the TPP, are expected to bring more opportunities for accelerating Vietnams’ exports, attracting more investment and expanding service activities thus paving the way for the development of domestic production and the nation’s participation in the global supply chain. 

Moreover, under the tariff and non-tariff reduction and elimination commitments, Vietnam goods can have easier access to the markets of FTA partner countries. 

The FTA relationship with the US and the EU will help the country build a more balanced and diversified export structure. Additionally, Vietnam will have a great deal of advantages in the medium term over many competitors when achieving greater market penetration. These are the benefits of strategic significance in trade relations.

Helping Vietnam further promote economic restructuring
Besides the above-mentioned opportunities, Minister Hoang said Vietnam’s participation in FTAs will also pose challenges to the domestic economy and trade as these agreements, principally the TPP have a very broad scope of adjustment with the high level of liberalization.

Joining FTAs, Vietnamese businesses will have to meet requirements for high-quality goods standards under pressure to comply with regulations on hygiene, the environment, labor and technological application. This provides ample opportunity for capacity enhancement and poses challenges to Vietnamese enterprises.

The question is how to enable export enterprises to take full advantage of benefits presented by FTAs in order to bolster exports and expand the market.

“Currently, some businesses’ limited knowledge about these FTAs has prevented them from enjoying tax benefits and improving the competitiveness of their products in the international market," Hoang noted.

The signing of the TPP Agreement will also offer a wealth of opportunity for the Vietnamese people to approach abundant sources of high quality goods with diversity of types and prices. 

The TPP Agreement with the building of a clear, transparent and stable policy environment facilitating investment and business activities will help Vietnam further boost the economic restructuring process and growth model transformation that will deliver plenty of benefits to the Vietnamese people.

In addition to market access negotiations, the Ministry of Industry and Trade (MoIT) will continue to step up communications on the signed and to-be-signed agreements with the aim of helping businesses make the best of benefits these agreements.

It will also provide and coordinate with relevant ministries to propose solutions for accelerating foreign and domestic investment attraction in projects in the supply chain of export manufacturers aimed at increasing the localization rate and value-added for export products, Hoang added.