VOV: What are the changes in the national economy, especially trade activities after Vietnam has agreed to implement WTO commitments?

Mr Tu: I think that after joining the WTO, foreign and local investment will increase rapidly. Trade activities will become hectic as there are many big corporations and enterprises coming to Vietnam. Some industries will be under pressure. Agriculture will not be greatly affected by the WTO accession as Vietnam is considered a major farm produce exporter in the world with key export items such as coffee, rice, pepper, cashew nuts and tea. However, there remain some industrial branches with low competitive edge, like industrial consumer service. It is very difficult to compete in the market if businesses do not increase investment, upgrade equipment, improve competitive capacity, reduce costs and create a good distribution network. It is also very important to encourage enterprises to invest in new technologies to prevail the local market gradually.

VOV: Are you worried about the capability of meeting with international standards and the implementation of the WTO rules, especially in terms of policies and competitive capacity of Vietnamese enterprises?

Mr Tu: In fact, we are very worried about Vietnamese enterprises’ competitive capacity. The government has approved and implemented a national project on strengthening enterprises’ competitive capacity in the past three years. In addition, it is necessary to continue building a complete system of legal documents and facilitate the development of business rights. Over the past years, the Law on Enterprise has created favourable conditions for enterprises to invest overseas as well as in the local market and help reduce administrative formalities. The number of enterprises is very big and I believe that they will overcome challenges. Obviously, the government will provide support to them.

VOV: As you said, the Government, ministries, agencies and businesses have a lot of work to do. For enterprises, they must concretize issues that we have negotiated in order to cope with challenges and make use of advantages. To achieve the goal, what should businesses do?

Mr Tu: We have joined the World Trade Organization (WTO) to help domestic products and services access the global market to create a good environment that will attract more foreign investors. To make use of these opportunities, enterprises must be a focal point of the integration process. First, businesses must boost production activities and penetrate into markets committed to opening up to Vietnamese goods and services. Second, businesses must quickly dominate the domestic market before Vietnam opens up its market for foreign partners. Third, domestic enterprises, ministries, agencies and localities must grasp every opportunity to attract investment and promote national economic growth. Fourth, businesses must map out a development strategy for their products and services in both domestic and foreign markets. To do this, it is essential to upgrade facilities, increase productivity, enhance management capacity and sharpen competitive edge. It is also necessary to train staff in marketing and professional skills so that they can make use of new opportunities for the benefit of their businesses and the country.

VOV: Besides tariff reductions under WTO commitments, Vietnam has to implement commitments to the Association of Southeast Asian Nations (ASEAN). Do you think that this could cause a big shock for national economy and domestic businesses?

Mr Tu: I think that the pressure will not be too high. It is unlikely that foreign products will flood the Vietnamese market. We should not worry too much about the implementation of WTO commitments because WTO commitments on tariff reductions are different from those with ASEAN. Vietnam has to apply 0 percent tariff rate following its commitments to ASEAN, but the country does not have to impose the same rate while implementing its WTO commitments. Vietnam only has to apply certain tariff rates so that domestic products can compete well with other rivals. For example, the agricultural sector has to face the biggest challenge as Vietnam abolishes subsidies for export of farm products. However, the sector still enjoys 10 percent subsidy. In the coming time, subsidies will be provided directly to farmers and craft sectors that need support.

VOV: Thank you.