VIETNAM IN THE

RCEP ERA
WHAT IS WAITING FOR US?

NGUYEN BA HIEN NGUYEN DOAN LE DUY LUONG NGOC THANG LE NGAN HANH PHAM CHI BAO
s3738243 s3804796 s3822048 s3730018 s3761226
TRẦN QUỐC KHÁNH
DEPUTY MINISTER OF INDUSTRY AND TRADE

• System between Vietnam and partners : ASEAN, APEC, ASEM, WTO as well as
other regional and international economic organizations.

• Bilateral relations and market development,

• Handling trade disputes and anti-dumping, anti-subsidy abroad for Vietnamese

goods in Asian countries – Pacific .

• Chairmen of councils, heads of other steering committees in related fields.

• Duties as assigned by the Minister (MOIT, nd).

WHAT

WHY? (MOIT 2020)

1 Government

2 Producers
What are impacts on
stakeholders?
3 Consumers

4 Investors
 Competition

Tariff revenue loss

Context
Trade Deficit

Attracting high quality of FDI

Competition
• Many countries in the region offer
same products
• China with great advantages in
terms of price and quality
• Domestic businesses face
customers loss (BBCINCORP
2021)
Tariff revenue loss

(Banga et al 2021)
(Anh & Ngoc 2020)

ASEAN COUNTRIES HAVE TO PURCHASE HIGHER COST GOODS (SITHANONXAY 2021)

SUBSTANTIAL TARIFF REVENUE LOSSES FROM TARIFF LIBERALISATION (RASHMI, KEVIN & PRERNA 2021)
Trade deficit
(GSO, 2021)
The trade balance of Vietnam has been affected by COVID 19 in
2021 (GSO 2021)

With RCEP come into effect, Vietnam trade deficit issue will be
worsened

Vietnam will rely on foreign power to meet domestic demand

and cause the recession of foreign currencies (BBCIncorp
2021)
 Attracting high quality

RCEP ENCOURAGE HIGH FDI

VIETNAM FACED DIFFICULTY IN A LARGE PROPORTION OF FDI
INFLOW TO MEMBER
ATTRACTING HIGH QUALITY FDI WILL CENTERED ON CHINA
COUNTRIES (FDI CENTER 2020) (FDI CENTER 2020) (LIANG 2021)
 Analysis of RCEP
Governments
• Promote trade and bureaucracy openness (Nguyen et al. n.d)
• MFN tariff steams adjustment (Baclig 2021)
• Increase national budget for spending and abide regulation (PWC 2020)
• Invest more in secondary/tertiary sectors that create competitive values (Phong
2019)

Producers
• Create a network of sustainable supply chain
• Increase profit margin
• Increase product variety
• Adjust pricing to match competition (Tu and Le 2017)
 Analysis of RCEP
Consumer
• Exposed to more selections (CGTN 2022)
• Shift priority away from domestic choices (Nguyen, Thung, Teluja 2021)
• Ease of trade (Fintech, E-commerce)
• Less protection from market volatility, price surges, scarcity, and
international scams (Nguyen, Thung, Teluja 2021)

Investors
• Investing are now more selective (Blanchard and Liang 2021)
• SMEs/Corporations/Markets hungry for cash (WTO-FTA 2021)
• Diluted and saturated market (oversupply)
• Inadequate capital for investment (overdemand) (Tu and Le 2017)
R E C OMME N DAT I O N
 Enhance awareness about FTAs
1 out of 20 businesses knows
about CPTPP commitments
related to business activities

More than 75% of surveyed

firms are not aware of the
relevant trade benefits

(VCCI 2021)

(PWC 2018)
(WTO center 2020)
 Promote supporting industry
• Manufacturing industries are heavily depend on foreign supply chain (Anh, 2021)

• The need to build programs on improving competitiveness of local enterprise and facilitating their participation in the
global value chains (The Star 2022)

• Focus on promoting the restructuring of industrial production with the highest priority to develop supporting industries
(Vietnam Briefing 2020)

(Vietnam Briefing 2020)

Attracting and securing high quality
FDI inflows

Improve infrastructure including transportation and telecommunicatio

connectivity (John Walsh n.d.)

Bring more skills and capacity into the workforce (Hoang n.d)
REFERENCE LIST
·Anh, T & Ngoc, L, 2017, ‘An Assessment of the Potential Economic Impacts of RCEP on Vietnam Automobile Sector’, World Trade Institute, viewed 5 January
2022.<https://www.wti.org/media/filer_public/0a/f6/0af6afdb-c055-4e1c-856a-9208a41c89ec/working_paper_no_05_2017_tu_thuy_anh_and_le_minh_ngoc.pdf>.

·Banga, R, Gallagher, K & Sharma, P, 2021, ‘RCEP: Goods Market Access Implications for ASEAN’, Global Development Policy Center , viewed 5 January 2022.
<https://www.bu.edu/gdp/files/2021/03/GEGI_WP_045_FIN.pdf>.

·BBCIncorp, 2021, ‘RCEP: Opportunities and Challenges for Businesses in Vietnam’, viewed 5 January 2022.<https://bbcincorp.com/resources/rcep-opportunities-challenges-businesses-in-vietnam>.

·FDI center, 2020, ‘RCEP – the world’s largest trade agreement and its impact on FDI’, viewed 5 January 2022. <https://fdi-center.com/rcep-the-worlds-largest-trade-agreement-and-its-impact-on-fdi/>.

·Hoang, N, 2021, ‘Attracting investment to Vietnam through RCEP’, RMIT University, viewed 5 January 2022.<https://www.rmit.edu.vn/news/all-news/2021/jan/attracting-investment-to-vietnam-
through-rcep>.

·PWC, 2018, ‘Free Trade Agreement Utilisation Study’, viewed 5 January 2022.https://www.dfat.gov.au/sites/default/files/free-trade-agreement-utilisation-study-pwc-report.pdf.
Baclig, CE 2021, 'RCEP: Weighing the good, bad in world's biggest free trade pact', Inquirer, viewed 5 January 2022, <https://newsinfo.inquirer.net/1522354/rcep-weighing-the-good-bad-in-worlds-
biggest-free-trade-pact>

BBCIncorp RCEP: Opportunities and Challenges for Businesses in Vietnam

Blanchard and Liang 2021, Reconsidering RCEP's Impact on Foreign Investment, The Diplomat, viewed 5 January 2022, <https://thediplomat.com/2021/06/reconsidering-rceps-impact-on-foreign-
investment/>.

CGTN 2022, RCEP Enters into Force: Experts: more goods wil be available for consumers, CGTN, viewed 5 January 2022,
<https://news.cgtn.com/news/2022-01-02/VHJhbnNjcmlwdDYxNjky/index.html>.
 Nguyen, D, Thung, B, Teluja, K 2021, RCEP: How Asia Pacific's Trade Deal can Reshape Financial Services, Ernst & Young, viewed 5 January 2022, <https://www.ey.com/en_kr/financial-services-asia-
pacific/rcep-how-asia-pacific-s-trade-deal-can-reshape-financial-services>

Phong, L 2019, 'Công nghiệp điện tử “có tiếng, thiếu miếng”', SÀI GÒN GIẢI PHÓNG ONLINE, 15 July, viewed 5 January 2022, <https://www.sggp.org.vn/cong-nghiep-dien-tu-co-tieng-thieu-mieng-
604797.html>.

PWC 2020, Regional Comprehensive Economic Partnership (RCEP) - what it means for international trade, PWC | Customs and Trade News, pp. 1-4.
Samuel, P, 2021, ‘RCEP and Vietnam: New Opportunities for Investors’, Vietnam Briefing, viewed 5 January 2022. https://www.vietnam-briefing.com/news/rcep-vietnam-new-opportunities-for-
investors.html/ .

Suvannaphakdy, S, 2021, ‘Assessing the Impact of the Regional Comprehensive Economic Partnership on ASEAN Trade’, Journal of Southeast Asian Economics, vol. 38, no. 1, pp. 133-54, viewed 5 January
2022.<https://www.proquest.com/docview/2544277430?accountid=13552&parentSessionId=ngDQ3o1AFeJrRCh5eqraIhMzlcutf%2BVD2%2FXHC7Ft35I%3D&pq-origsite=primo>.

The Star, 2022, ‘Vietnam pins high hope on RCEP for speeding up economic recovery amid pandemic’, viewed 5 January 2022.https://www.thestar.com.my/aseanplus/aseanplus-news/2022/01/01/vietnam-
pins-high-hope-on-rcep-for-speeding-up-economic-recovery-amid-pandemic.

DRIVE DISCIPLINE ADAPTABILITY

Tran, B, 2021, ‘Vietnam Continues Efforts to Reduce Trade Dependence on China’, ISEAS, viewed 5 January 2022.<https://www.iseas.edu.sg/wpcontent/uploads/2021/08/ISEAS_Perspective_2021_114.pdf>.

Trinh, N, 2020, ‘Vietnam Approves Resolution 115 on Promoting Supporting Industries’, Vietnam Briefing, viewed 5 January 2022.https://www.vietnam-briefing.com/news/vietnam-approves-resolution-115-
promoting-supporting-industries.html/.

Tu, A and Le, N 2017, An Assessment of the Potential Economic Impacts of RCEP on Vietnam Automobile Sector, World Trade Institution, No. 5, pp. 1-21.
VCCI, n.d, ‘Việt Nam Sau 2 Năm Thực Thi Hiệp Định CPTPP: từ góc nhìn doanh nghiệp’, WTO Center, viewed 5 January 2022.<https://wtocenter.vn/file/18394/bao-cao-danh-gia-tinh-hinh-viet-nam-sau-2-
nam-thuc-thi-cptpp-tu-goc-nhin-doanh-nghiep.pdf>.

Vietnam Credit, 2021, ‘RCEP expected to boost Vietnam’s textile and garment industry’, viewed 5 January 2022.<https://vietnamcredit.com.vn/news/rcep-expected-to-boost-vietnams-textile-and-garment-
industry_14590>.

VietnamNews, 2020, ‘Local firms ready to fully tap into advantages of RCEP’, , viewed 5 January 2022, <https://vietnamnews.vn/economy/831000/local-firms-ready-to-fully-tap-into-advantages-of-
rcep.html>
WTO Center, 2020, ‘Bang tan dung uu dai FTAs qua tung nam VN 2020’, viewed 5 January 2022.<https://wtocenter.vn/file/18506/bang-tan-dung-uu-dai-ftas-qua-tung-nam--vn-2020.pdf>.

WTO-FTA 2021, RCEP: Weighing the good, bad in the world's biggest trade pact, WTO-FTA, viewed 5 January 2022, <https://wtocenter.vn/chuyen-de/18644-rcep-weighing-the-good-bad-in-worlds-biggest-
free-trade-pact>.