Vietnam will be able to access a huge market of 3.4 billion people whenit joins the Regional Comprehensive Economic Partnership (RCEP).
Countries in RCEP will have a combined GDP of 21 trillion USD,accounting for 29 percent of the world's GDP, said Nguyen Anh Duong,Deputy Director of the Central Institute for Economic Management (CIEM).
Speaking during a workshop held in Hanoi on July 17 onthe impact of RCEP on Vietnam's economy and the opportunities andchallenges it would pose, Duong said regulations on origin in RCEP wouldbe simpler and more liberal than in other economic pacts. In addition,the parties would make more commitments on freedom of trade in goods andservices and investment.
Negotiations on RCEP officiallybegan in 2012 with six countries: Australia, China, India, Japan, theRepublic of Korea and New Zealand. The pact aims to build a regionalfree trade area. The RCEP states' total GDP will be higher than thecombined GDP of countries in the Trans-Pacific Partnership (TPP), whichwill account for 26 percent of the world's GDP, and it will have arapidly growing middle class.
According to Duong, RCEP isexpected to offer major opportunities to Vietnam by improving itsaccess to investment and export markets in the member states of theAssociation of Southeast Asian Nations (ASEAN), as well as partners withdemand for diverse goods. At the same time, it could make imports oftechnology and machinery cheaper, thus creating opportunities forVietnam to join the region's production value chain, Duong said.
The pact could also help Vietnam reduce transaction fees, create afriendly business environment and enhance its role in resolving tradeand investment disputes, he said.
Sectors such asseafood, agriculture, construction, garments and textiles, as well asleather footwear, would have additional opportunities for growth, headded. For example, the country would have major opportunities indistribution and in the hotel and restaurant business in the countriesin RCEP, especially in Japan and the ASEAN states, besides opportunitiesin providing services to Australia, Duong said.
However,Vietnam would also face challenges in banking services as the RCEPcountries in the region, such as Singapore, Japan, the RoK andAustralia, have highly developed banking sectors.
Vo TriThanh, CIEM's deputy director, said RCEP and TPP would not clash butsupport each other to help Vietnam integrate further into the worldeconomy.
"The two pacts have a common feature ofcommitment to freedom in trading goods and services, and in investment.Talks on both RCEP and TPP are expected to end this year," Thanh said.
In RCEP, ASEAN is looking for cooperation and equal development. TheTPP is a free trade agreement aimed at resolving the issues of labourstandards, a competitive environment, State-owned enterprises, Statepurchases and intellectual property.
"Some people thoughtthat TPP and RCEP will compete with each other and overlap. However, inmy view, the two pacts could supplement each other," Thanh added.
Vietnam would have more benefits than challenges by joining RCEP, he noted.
Earlier, an ANZ Bank report said that Vietnam and Thailand would be the countries to benefit the most from RCEP.
Vietnam's GDP is expected to grow 8 percent in five years after signingthe RCEP, while Thailand's GDP is expected to grow 13 percent. The RCEPstates will account for 85 percent of the world FDI flow.
Thanh suggested that Vietnam should take advantage of RCEP by improvingthe competitiveness of domestically produced items and focusing on someindustries that could benefit from the deal.-VNA
Countries in RCEP will have a combined GDP of 21 trillion USD,accounting for 29 percent of the world's GDP, said Nguyen Anh Duong,Deputy Director of the Central Institute for Economic Management (CIEM).
Speaking during a workshop held in Hanoi on July 17 onthe impact of RCEP on Vietnam's economy and the opportunities andchallenges it would pose, Duong said regulations on origin in RCEP wouldbe simpler and more liberal than in other economic pacts. In addition,the parties would make more commitments on freedom of trade in goods andservices and investment.
Negotiations on RCEP officiallybegan in 2012 with six countries: Australia, China, India, Japan, theRepublic of Korea and New Zealand. The pact aims to build a regionalfree trade area. The RCEP states' total GDP will be higher than thecombined GDP of countries in the Trans-Pacific Partnership (TPP), whichwill account for 26 percent of the world's GDP, and it will have arapidly growing middle class.
According to Duong, RCEP isexpected to offer major opportunities to Vietnam by improving itsaccess to investment and export markets in the member states of theAssociation of Southeast Asian Nations (ASEAN), as well as partners withdemand for diverse goods. At the same time, it could make imports oftechnology and machinery cheaper, thus creating opportunities forVietnam to join the region's production value chain, Duong said.
The pact could also help Vietnam reduce transaction fees, create afriendly business environment and enhance its role in resolving tradeand investment disputes, he said.
Sectors such asseafood, agriculture, construction, garments and textiles, as well asleather footwear, would have additional opportunities for growth, headded. For example, the country would have major opportunities indistribution and in the hotel and restaurant business in the countriesin RCEP, especially in Japan and the ASEAN states, besides opportunitiesin providing services to Australia, Duong said.
However,Vietnam would also face challenges in banking services as the RCEPcountries in the region, such as Singapore, Japan, the RoK andAustralia, have highly developed banking sectors.
Vo TriThanh, CIEM's deputy director, said RCEP and TPP would not clash butsupport each other to help Vietnam integrate further into the worldeconomy.
"The two pacts have a common feature ofcommitment to freedom in trading goods and services, and in investment.Talks on both RCEP and TPP are expected to end this year," Thanh said.
In RCEP, ASEAN is looking for cooperation and equal development. TheTPP is a free trade agreement aimed at resolving the issues of labourstandards, a competitive environment, State-owned enterprises, Statepurchases and intellectual property.
"Some people thoughtthat TPP and RCEP will compete with each other and overlap. However, inmy view, the two pacts could supplement each other," Thanh added.
Vietnam would have more benefits than challenges by joining RCEP, he noted.
Earlier, an ANZ Bank report said that Vietnam and Thailand would be the countries to benefit the most from RCEP.
Vietnam's GDP is expected to grow 8 percent in five years after signingthe RCEP, while Thailand's GDP is expected to grow 13 percent. The RCEPstates will account for 85 percent of the world FDI flow.
Thanh suggested that Vietnam should take advantage of RCEP by improvingthe competitiveness of domestically produced items and focusing on someindustries that could benefit from the deal.-VNA
