“International economic integration and WTO accession have positive effects on Vietnam’s economic growth, the most important positive impact is the growing confidence in Vietnamese economic development prospects,” heard a seminar reviewing impacts of international economic integration on the Vietnamese economy after three years membership in the World Trade Organisation (WTO) held by the Ministry of Planning and Investment in Ho Chi Minh City on March 29.
The seminar also discussed many other positive effects: relatively high GDP growth, robust-growing export - import turnover; fast-rising FDI, ODA and remittance inflows; strengthened and expanded international commercial and economic cooperation relations; uplifted position of Vietnam on the international arena, particularly its roles as a non-permanent member of the United Nations Security Council and president of ASEAN in 2010; improved quality of Vietnamese goods and stronger position of Vietnamese goods on international markets; improved resource allocation; poverty reduction and rising employment. At the same time, market economic institutions have been increasingly completed; managerial capacity of State agencies has been gradually perfected; and the position and competitiveness of Vietnamese enterprises have been steadily enhanced. On the other hand, commodities come in more designs, higher quality, reasonable price, more options for customers. Domestic companies also can access better inputs.
However, according to authors of the review, who came from the Central Institute of Economic Management (CIEM), although WTO accession brings home positive effects on Vietnam’s economic growth, the results are not as good as expected. There was evidence that export value and FDI attraction soared to record highs in 2007 and 2008 but the both values slumped after that. Especially in 2009, the global financial crisis and economic recession adversely impinged on the Vietnamese economy, which modestly expanded 5.3 percent. This pointed out that while WTO entry helped expand markets, GDP growth or an increase in export value or shipments was less than extraordinary.
Also according to authors of the report, WTO entry revealed more clearly internal structural limitations and weaknesses of the economy like growth quality, economic restructuring, institutional capacity, human resource quality, and infrastructure capacity. On the other hand, after joining the WTO, difficulties and challenges facing Vietnamese economy and businesses are also bigger and more complex than ever. Trade relations with some partners were seriously imbalanced and detrimental to the economy and domestic enterprises.
Dr Vo Tri Thanh, Deputy Director of CIEM, noted that the bright aspect of the three years of WTO membership was the rapid expansion of middle class - this class will counterbalance interest groups and will be beneficial and much better for the society. However, according to Mr Thanh, the span of three years is not long enough, in couple with unpredictable fluctuations of world economy, to comprehensively analyse and evaluate the impact of WTO accession on Vietnam’s economy. It is more important that Vietnam should know that WTO accession is only the starting point of a large trade space; thus, it necessarily cashes in on advantages to create leverage for sustainable development.
All participants to the seminar shared the view that WTO entry was a mixed blessing for the Vietnamese economy and drew common important lessons and experiences after three years. Mr Nguyen Dang Binh, Deputy General Director of National Economic Department under the Ministry of Planning and Investment, said: To promote advantages and tackle challenges, Vietnam needs to accelerate reform and improve growth quality and competitiveness of industries and enterprises.
In addition, participants put forth many recommendations for abolition of negative impacts of WTO membership and enhancing the competitiveness of the Vietnamese economy. Some recommendations target five main policy packages to improve the enforcement of international economic integration policies, boost growth quality, enhance the quality of foreign investment, and continue consistent implementation of macroeconomic stabilisation and financial market development policies.
Hong Hoa
Vietnamese
