The 12-member TPP trade deal would have lifted the country’s US$193.6 billion economy— by some estimates as much as 11% in terms of gross domestic product over coming years.
This results because the trade pact would have allowed for exporters operating within the borders of Vietnam to pay lower and in many cases no tariffs for shipping goods within the proposed TPP free trade region
Transnational companies with operations in Vietnam that would have benefited tremendously include Siemens, Intel, Samsung Electronics, and major Japanese automakers besides US apparel and shoemakers.
Though it now appears likely the TPP is down for the count and will not be resuscitated, HCM City, like the Vietnam Government, remains committed to continuing down the path of fully integrating the country’s economy, said Le Thanh Liem, vice chair of the Committee at a recent luncheon.
At the meeting, Mr Liem reminded the audience that the decision to pull back from the TPP was made by the Government well prior to US President-elect Donald Trump’s announcement of his intention to withdraw.
Since that decision was made, he noted, HCM City and the Government have actively pursued a robust trade agenda seeking independent bilateral and free-trade agreements with TPP signatory member countries and other regional trade blocs.
They have also proceeded on a course to implement crucial reforms to improve the country’s business climate, train the country’s work forces and elevate the domestic sector’s competitiveness among other steps important for successful integration.
On November 22, Trump said: “On trade, I am going to issue a notification of intent to withdraw from TPP, a potential disaster for our country [the US]. Instead, we will negotiate fair, bilateral trade deals that bring jobs and industry back on to American shores.”
With respect to trade, Trump has made it clear the US will remain open for business and HCM City along with the Government welcomes new bilateral trade negotiations with open arms, said Mr Liem.
The geopolitics of trade are in flux right now until both countries sit down at the table and hammer out a new bilateral trade agreement. From Vietnam’s point of view, we have positive demographics— we have comparative advantages in many segments of the economy that the US desires, added Mr Liem.
We also have a highly appealing commercial and consumer market for US businesses, he noted.
So though there is a lot of uncertainty, there is no cause for alarm or reason not to believe that a new bilateral trade agreement with the US would not hold great promise for the future.
HCM City is as positive as ever on the prospects for enhanced trade, and believes the country is uniquely poised to take advantage of the current global economy. There's a window of opportunity open for us with the upcoming change in the US administration.
The time is ripe for Vietnam and the US to partner for prosperity.
It is our sincere hope, said Mr Liem, that Vietnam become an economic hub for the globe and a location of choice for business and investors directly contributing to job creation and middle-class prosperity.
As we approach the upcoming new year, there is no reason not to be as thrilled about the country’s economic prospects for tomorrow as there was last year at this time, he concluded./.