Implementation of Post-WTO Commitments

How has Vietnam prepared for the World Trade Organization entry as well as speeded up the reform process of economic laws and implemented commitments for the post-WTO stage? The problem is drawing attention from economic experts.

 

Luong Van Tu, Deputy Minister of Trade and the Head of the Vietnamese negotiation team working towards WTO accession, confirmed that: When becoming WTO member, Vietnam will have to implement its obligations and commitments, especially on the non-discrimination and fair competition, on tariff, non-tariff barriers, on trade and service liberalization, and commitments on facilitating investment activities.

 

Vietnam has made strong commitments and concluded WTO talks with 22 out of total 28 countries that required negotiations, including important partners such as the EU, China, Japan, South Korea, and Canada. Thus, Vietnam needs to negotiate with the US, Australia, New Zealand, Mexico, Honduras and Dominica.

 

Vietnam is now checking legal documents to find out and adjust or remove the regulations that are unsuitable and restrain the most favored nation (MFN) or national treatment (NT) status towards goods and services. The issue of the common investment law is the basis for the equal treatment between domestic and foreign investors. Vietnam also has to give MFN and NT status to ASEAN, APEC and WTO country members in terms of commodities, services, investment and intellectual property. However, the problems are more complicated than the implementation of the status only.

 

Take the case of China as an example after China became full member of WTO, the US has sued China for violating the NT status. Regarding tariff, WTO members have to pledge not to raise tariffs to exceed a certain level on imported goods categories. WTO also has regulations to cut tariffs. 

 

Vietnam has launched the tax category No.4 for tariff cut, of which 99.7 per cent of total 10,800 commodities have average tax rate of 18 per cent. The industrial products will be levied at 16 per cent, fisheries 22 per cent, agro products 24 per cent. The roapmap for tariff cut lasts with three to five years. In addition, some protective measures, such as quota, import licenses, localization rates, will be axed gradually.

 

Competition in service sectors
To join WTO, Vietnam must commit to ensure foreign investors can invest and operate in many limited services. Commitment scope depends on negotiation process. However, competition in many important service sectors namely: telecommunications, banking, insurances… roughly raise considerably. Mr.Tu said that: in tax category No.4 for tariff cut, Vietnam gave out 92 of 155 branches in 10 of 11 service sectors. There are: business services, information services, finances and banks, distributions, constructions and its synchronous relevancies, public health care, tourism and its relevancies, entertainment and cultural services, transportations…

As long as commitment to trade liberalisation , Vietnam not only signs and the commitment of facilitating relevant trade investment operations, but also completely implements TRIMs Agreement of WTO that commits to abolish eradicating investment barriers, with the comprehensive target to strengthen the attractiveness, clear and explicit foreign investment environment in Vietnam. In addition, Vietnam also launches commitments of making action plan, building legislation, intellectual property right protection, custom procedures…

 

Law frame work must be more efficient
This is experts’ warning about under joining WTO of Vietnam. In reality, although Vietnam had many efforts to improve legislation frame work in relation to economy and commerce, it still has a lot of shortcomings namely policies on competition, commerce, environment, electric commerce, intellectual property, commercial protection tools. For instant, a legislation document from issued to come in to effect need a long time for consultant to guarantee its transparency. This is other example: a commercial policy need a suitable improving to support non – tariff measures eradication.

Besides, limited human resources is also a big challenge to Vietnam. Vietnamese officers is limited in international experiences, economics, foreign language and particularly negotiable techniques. Those factors considerably prevent Vietnam from going to real negotiation stage. In post WTO stage, human resources play a considerable role in commitment implementation of Vietnam as well as supporting enterprises to adapt to the international market.