13:34 | 06/12/2015 Economy- Society
The Trans-Pacific Partnership agreement is expected to anchor and accelerate domestic structural reforms in Vietnam, the World Bank has said.
World Bank economists speak at the release of the report on Vietnam's economy on Dec. 2 (Photo: Tuan Minh)
The landmark trade accord is not only removing trade barriers and enhancing market access to key export markets, but it will also have tangible impacts on regulatory quality, intellectual property rights, investor protection, competition, SOE management, labor and environmental standards, food safety, public procurement, and liberalization of services, says the report.
The report highlights TPP-sourced benefits for Vietnam in trade, investment, growth and job creation. Vietnam has unique comparative advantages, particularly in labor-intensive manufacturing and sectors currently subject to high tariffs.
The report cited preliminary results as saying that the TPP could add as much as 8% to Vietnam’s GDP, 17% to its real exports, and 12% to its capital stock over the next 20 years.
However, Pham Minh Duc, senior WB economist, pointed out challenges that Vietnam will face when joining the U.S.-brokered deal. They are rules of origins, given Vietnam’s high dependence on imported materials in key sectors, state-owned enterprises, decline in government revenue, and labor and environment issues.
The TPP was concluded on October 5, 2015 after more than five years of negotiations. The combined GDP of the TPP market, which embraces 12 prospective members, is equal to $28 trillion, or about 36% of world GDP, and accounts for more than a quarter of world trade./.