Preparation proves key to Vietnam’s success post TPP

Do you expect that the TPP will wrap up negotiations late this year?

Unlike most other bilateral and multilateral trade agreements, the coverage scope of the TPP is both wide and deep. Therefore, negotiations have taken place in a discreet fashion, particularly with regard to the US. The TPP can hardly be signed if the 11 remaining parties cannot find a common voice in negotiations with the word’s leading economy, the US.

Luckily, things turned out smoothly, as the US Congress recently agreed to authorise the Trade Promotion Authority (TPA), allowing President Barack Obama to negotiate trade agreements in Asia and elsewhere.

Could you elaborate on the TPA’s significance?

This generally means that the executive body – the president in the White House – will lead negotiations on the content, clauses, and commitments of the TPP with 11 Pacific-rim nations. After the negotiations are concluded, the Congress as the legislative body will ratify or reject such an agreement, but will not change the content.

The TPA serves as an effective tool for the president to advance the TPP negotiation process, so that TPP negotiators can expect their negotiated content will have a good chance of being passed by the US Congress, ensuring the TPP’s success.

Therefore, the Vietnamese government and businesses must be proactive in this preparatory stage if we are to fully tap the opportunities arising from the TPP. This will also help us minimise losses when joining this global trading ground which accounts for 40 per cent of global trade value.

Do you think Vietnam is properly prepared to join the TPP?

In a world that has become increasingly ‘flat’, integration is not just an issue for the government and state management agencies, but also a concern for each business and citizen.

At a central level, the government and authorised agencies have actively taken part in negotiations, and have shown dogged determination in tackling tough issues, so as to deepen and broaden integration efforts for Vietnam’s economy. Specifically, Prime Minister Nguyen Tan Dung, as the head of the government and also head of the National Steering Committee for International Integration, has urged government agencies and localities to actively deploy national target programmes to boost the country’s competitiveness. In the meantime, we have been increasingly awared about the advantages and disadvantages that are likely to arise once Vietnam joins trade and investment agreements, particularly the TPP.

What preparations are needed from local firms to tap the advantages of the TPP?

Around 97 per cent of Vietnamese firms are small and medium in size with limited capital sources, so their preparations for future production and business plans after Vietnam joins the TPP would be limited.

The government therefore needs to adopt programmes and policies to improve knowledge about the principles and commitments accompanying international free trade agreements, particularly the TPP, to help firms sharpen their edge when joining global trade.