The following article will summarize the most basic information about the TPP and its impact on Vietnam.
TPP is an abbreviation of “Trans-Pacific Partnership”.
Started at the end of 2005, TPP initially includes Brunei, Chile, New Zealand and Singapore. September 2008, America declares join TPP but not the “old” one, it was the newly negotiated trade agreement still called TTP. Subsequently, Australia, Peru, Vietnam, Malaysia, Canada, Mexico and Japan took turns joining in, bringing TTP’s total members to 12.
The main goal of the TPP is the elimination of taxes and barriers for goods and services traded between member countries. Additionally, TPP also covers a wide range of non-tariff concerns such as intellectual property, food safety and labor standards…
Until now, the TPP so far has gone through 20 official sessions and many mid-term sessions. The issues outlined in the agreement include intellectual property rights, foreign investment law, environmental and labor standards, procurement policy, competition and state-owned firms, the process of dispute settlement.
TPP will cover 40% of the global economy and is predicted to add to the global GDP nearly 300 billion USD each year. Joining TPP would help Vietnam balance the trade relations with key market areas, avoid excessive dependence on one specific market area. Free trade relations with major markets like the US, Canada, Japan; and the elimination of import tariffs for agricultural products will be a tremendous boost Vietnamese export.
In addition, Vietnam will also benefit greatly from the wave of new foreign investments, creating more jobs and forming new production capacity. With even deeper and wider commitments compared to WTO, TPP will help Vietnamese economy reallocate resources toward a more efficient direction, positively supporting the process of restructuring and growth model innovating.
However, besides the positive factors mentioned above, participation in TPP also poses a number of challenges, especially competitive pressure cause by reducing import tariff to 0%, services market opening, strict governmental procuring and investing.