Taking Care of Goods Value Chain

Vietnam is very active with international economic integration and its relations with other countries and international organisations are increasingly deep. Its position on the international arena is also confirmed. However, Mr Truong Dinh Tuyen, former Trade Minister (now the Ministry of Industry and Trade) also candidly pointed out that deeper international economic integration, either unilateral or multilateral, brings in many benefits but also poses enormous challenges, particularly since Vietnam joined the WTO and started greater participation in free trade agreements (FTAs) with partners. The current situation requires an extremely effective import-export strategy to improve the efficiency of resource allocation, improve the competitiveness of the economy and macroeconomic stability.

 

Mr Nguyen Thanh Bien, Deputy Minister of Industry and Trade, also pointed out that international economic integration has a strong and deep impact on Vietnam’s macro economy and import - export. Its macroeconomic situation was relatively stable from 2001 to 2005. However, problems emerged in the 2006 - 2010 period because of slowing growth and excessive investments. In economic structure, agriculture, forestry and fishery contribute less to the country’s GDP, while there is a rise in industry and construction. Nonetheless, progress is slowing down. Meanwhile, import growth exceeds export growth.

 

Technical barriers in importing markets are a tough problem for some Vietnamese exporters. These can uproots the position of Vietnamese goods on international markets. According to experts, it is urgent to restructure target markets, export - import activities, and enhance goods quality. In addition, an important content of Vietnam’s export - import development strategy is to promote negotiations and signings of free trade agreement (FTAs) and focus on tariff reduction schedules. Strong tax cuts will widen market access opportunities for Vietnam’s exports, especially in markets with faster liberalisation rates or with more incentives.

Mr Vo Tri Thanh, Deputy Director of the Central Institute for Economic Management (CIEM), said: The cleverness in market management and development of the industry and trade sector is to create pressure on the domestic market to force us to move forward on the one hand. On the other, negotiation terms with partner countries must rely on the principle of reciprocity to persuade them to grant us time to perfect exports.

 

Mr Hans Daag, Commercial Counsellor, Embassy of Sweden in Vietnam, said: The lifting of tariff barriers is a concern for Vietnamese businesses and authorities when they enter global trade grounds because, apart from stiffly competing with low-tax foreign goods, Vietnam also has to improve goods quality to pass technical barriers and protectionist measures. In addition, it needs to develop the goods value chain, rather than only separate kinds of goods.

 

According to experts, in its market development orientation, Vietnam also needs to pay special attention to new potential markets such as South Korea and India, and keep a close watch on China’s trade policies to boost exports.