The Trans-Pacific Partnership (TPP) agreement is really a golden chance for Vietnam’s economy, as it will bring even more benefits to the country than the accession to the World Trade Organisation (WTO). This is the statement of Mr Le Van Tang, Head of Bidding Management Department (Ministry of Planning and Investment) in a conference on “government procurement in the Trans-Pacific Partnership (TPP) agreement” recently held in the capital city of Hanoi. On the sidelines of the conference, reporter Anh Phuong interviewed Le Van Tang about the issue.
Obviously, benefits that TPP would bring to Vietnam are greatly promising, but with the partner like the US, what benefits will Vietnam enjoy when joining preferential government procurement programs launched by the US?
In fact, the government procurement program is one of top contents in negotiation rounds of partners in the TPP agreement. In particular, the first agreement on government procurement (the GATT Agreement on Government Procurement was signed in 1981), included: limitation of goods purchased by governmental agencies; and the US is one of the member countries. After that, the country joined the WTO's Government Procurement Agreement (GPA) in 1996. The WTO's Government Procurement Agreement (GPA) is an extension of the GATT agreement on government procurement: services; authorised agencies at central and local levels; Government-managed enterprises (and other agencies). The US is one of the 41 member countries of WTO joining the GPA. The US has implemented free trade agreements (FTA), including government procurement agreements with 16 countries: including Australia, Canada, Chile, Mexico, Oman, Peru, Singapore, etc. Meanwhile, Columbia, the Republic of Korea and Panama are waiting for US congressional approval to sign FTAs.
To date, Vietnam has not been named in the list of US strategic partners in the US government procurement program, which is required in the Trans-Pacific Partnership agreement. In the upcoming time, the Government of Vietnam and relevant agencies should further promote negotiations with international partners to join the GPA. As the most powerful economy in the world, the US needs a huge amount of goods and services, and is a potential market for all businesses, including those from Vietnam. Besides, the country would enjoy major benefits from the TPP and GPA: goods exchange under the government procurement program are often huge, making up 10 – 15 per cent of GDP, Vietnam would have the chance to join bidding contracts with the same requirements with other bidders from other TPP member countries worldwide, for higher competitiveness. It can be simply said that Vietnamese bidders would have a chance to join fair competition with other partners in the US as well as others whose countries had been named in the US list of strategic partners. Vietnam would not be the subject to anti-dumping lawsuits, and higher taxes would not be imposed on key Vietnamese export goods, as previously.
Would Vietnam’s Government and businesses meet legal difficulties when joining the government procurement program?
In regard to administrative procedures, the US Government would create favourable conditions for international bidders to join its government procurement programs. In particular, there are three bidding modes under TPP: opening bidding, selective bidding, and limited bidding. The bidding schedule is set at 40 days, but can be reduced to 10 days and more in some special cases such as earthquake, Tsunami, or other natural disaster. Besides, in the bidding process, the US Government would be explicit in its statements: A bidder who has not won the contract has the right to make an inquiry or question the bidding organising board about the reason why the bid failed, and the bidding organising board will have to give reasonable explanation in ten days. The bidding organising board is an independent agency in the US government structure.
So, which agencies of the US will be key partners in the program?
Currently, there are four agencies, namely the Department of National Defence, the Department of Health & Human Services, the US Department of Energy and the General Service Administration (GSA), which are authorised to invite bidders and grant contracts. The agencies make up 91 percent of the total bidding value regulated by the US Government.
Can you give an overview of US government procurement demand and the participation of Vietnam in the program?
According to 2009 statistics, the US Government’s total woodwork procurement value reached US$1.8 billion and Vietnam exported US$3.4 worth of woodwork products to the market during the year; for healthcare equipment, total procurement value of the US Government was US$16.7 billion and Vietnam exported US$252 million; for fish and fish products, total procurement value of the US Government was US$1.6 billion and Vietnam exported US$3.9 billion; for computer and software, total procurement value of the US Government was US$10.8 billion and Vietnam exported US$83.9 million worth of the products to the market; for automobile spare parts, total procurement value of the US Government was US$2.8 billion and Vietnam exported US$234 million worth of the products. The figures showed that beside traditional items that Vietnam has exported to the US for years, the US remains a potential market for Vietnamese businesses to ship other products if they can take advantage of trade opportunities to raise trade turnover.
In the long term, what are the key export items of Vietnam in the US market?
Based on the statistics, woodwork and fish and fish products would continue being key exports of Vietnam to the US market. In the upcoming time, the Government of Vietnam needs to pour more investment into agriculture production and cultivation, as agriculture is still the key sector of Vietnam, with such products as coffee, pepper and cashew. Textile and garment is also a big cash earner for Vietnam in the market. The country should launch more trade promotion programs to advertise the products, as well as invest more in technology application and equipment purchases to raise exports of refined products and reduce raw materials exports.
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