Local firms prepare to capitalise on upcoming trade agreements
With the completion of the ASEAN Economic Community just around the corner and other significant trade deals including the TransPacific Partnerships pending, Vietnamese companies are looking to position themselves to make the most of these latest steps to
With the completion of the ASEAN Economic Community just around the corner and other significant trade deals including the Trans-Pacific Partnerships pending, Vietnamese companies are looking to position themselves to make the most of these latest steps towards global integration.
After many years of focusing on the US and EU markets, Garment Corporation 10 has decided to diversify its export outlets to avoid dependence on just a few markets.
The corporation has so far received the first orders to ship its products to the ASEAN countries.
The corporation's director Thaân Ñöùc Vieät, said that like other Vietnamese exporters, his company is boosting market diversification plans, especially when Vieät Nam is preparing for joining the ASEAN Economic Community (ACE) late next year and the Trans-Pacific Partnership in the future.
Vieät Nam's further integration into the global economy with the signing of the two abovementioned historic agreements is expected to open up major opportunities for Vietnamese exporters. They would be able to diversify their export markets and increase their export revenue just as it happened after Vieät Nam joined the World Trade Organisation.
Seven years since joining the WTO, Vieät Nam has jumped 13 spots to the 37th position among exporting countries and territories across the world, according to information released at a review of WTO members in Geneva late last year.
The Ministry of Industry and Trade (MoIT) has forecast that the country's exports to the ASEAN market would increase when the AEC is signed in late 2015. It added that with a population of 600 million, geographical proximity and having similar tastes as Vieät Nam, ASEAN would be a stable and potential market for Vietnamese products.
The ministry explained that when the AEC is formed, almost 100 per cent of ASEAN tariffs would be zero per cent and Vieät Nam can sell goods to the ASEAN market in ways that are similar to selling in domestic markets because of simplified trade procedures and new procedures for certifying the origins of products.
Vieät Nam's key export staples to ASEAN will also not have to face risks caused by trade barriers and competitive traps such as anti-subsidy and anti-dumping imposed by major markets such as the US and the EU, the ministry said.
The trade turnover between Vieät Nam and ASEAN has quadrupled over the past decade, climbing to nearly US$40 bil- lion in 2013 from $9 billion in 2003. But experts said it is not commensurate with potential as domestic enterprises have not yet taken full advantage of the geographical proximity and incentives offered by trade agreements, including the ASEAN Trade in Goods Agreement (ATIGA).
The figure has also tended to stagnate, and even fall in the first half of this year when the growth rate of the revenue from Vieät Nam's exports to the ASEAN markets was only 3.6 per cent compared with the country's average export growth rate of 13.2 per cent.
Experts attributed the low growth rate of exports to the ASEAN market to the fact that Vietnamese exporters had not paid attention to that market in the past years. Instead, they only