FTA quality improvement promotes exports: Experts

Vietnam enjoys high export growth in the first quarter of 2024 (Photo: VietnamPlus)

Positive progress was seen in exports in the first quarter of this year as the country earned more than 93 billion USD from overseas shipments, up 17 per cent year on year, with a trade surplus of 8 billion USD.

Revenue from the processing-manufacturing industry, which fetched 79.6 billion USD, accounted for 86 per cent of the country’s total export turnover, while agro-forestry-fisheries exports earned 8.46 billion USD, contributing 9.09 per cent to the country’s total.

Bui Huy Son, Director of the Ministry of Industry and Trade (MoIT)’s Planning and Finance Department, said that expansion was seen in exports of many products as well as shipments to the majority of export markets.

Particularly, exports to the US, Vietnam’s biggest market, reached 26.06 billion USD in the first three months of this year, up 25.5 per cent year on year. Those to China rose 5.2 per cent to 12.68 billion USD and to the EU 16.3 per cent to 12.1 billion USD.

Tran Thanh Hai, Deputy Director of the MoIT’s Import-Export Department held that a surge of 35.6 per cent in exports in March and 17 per cent in the first quarter of this year showed strong recovery in production and export activities of domestic businesses. This is a foundation for Vietnam to fulfil its export growth target of over 6 per cent for the whole year, he said.

Hai said that the 16 FTAs, covering all major export markets of Vietnam, have produced good results.

Currently, Vietnam is negotiating three other FTAs – a deal with the EFTA which comprises Switzerland, Norway, Iceland and Liechtenstein, an FTA between ASEAN and Canada, and another between Vietnam and the UAE.

Particularly, the negotiations for a Vietnam-UAE FTA are being accelarated, Hai noted.

The official said that the MoIT is focusing on expanding negotiations for more FTAs and popularising benefits from the signed deals to businesses for better exploitation.

The FTAs have shown positive impact on exports and contributed to maintaining Vietnam’s advantages in trade and investment activities. Vietnam is still likely to face challenges, such as unpredictable developments in the global economy, with growth in many regions forecast to be lower than 2023.

Meanwhile, attention should be paid to sustainable development, climate change response, and safety for consumers. This has led to new regulations and standards for the supply chain, materials, labour and environment in which import products are manufactured, he said.

In order to meet the increasing requirements of the market, MoIT Deputy Minister Nguyen Sinh Nhat Tan underlined the need to enhance the “quality” of the FTAs. Vietnam should continue negotiating to upgrade the deals, expanding markets and market approaches.

At the same time, Vietnam should seek new markets and diversify export markets, both traditional and new ones, Tan underscored.

He advised local firms to keep a close eye on the market development and changes in policies of partners to apply suitable response measures and adjust their production plans.

He pledged that the ministry will continue organising trade promotion discussions with the system of Vietnam trade offices abroad to seek ways to promote sustainable exports.

President suggests Vietnam, Malaysia take advantage of FTAs President Nguyen Xuan Phuc has recommended Vietnam and Malaysia capitalise on free trade agreements of which both are members, particularly the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).

FTAs to which Vietnam is a signatory, as of July 2023 The Vietnam - Israel Free Trade Agreement (VIFTA) was signed on July 25 and is the latest free trade agreement (FTA) Vietnam is a party to. Joining more FTAs will create significant opportunities for the country to deeply participate in global value chains, increase exports, boost GDP growth, and improve its institutions.