Vietnam strives to overcome challenges of WTO entry

Vietnam is working out specific measures to overcome challenges after joining the World Trade Organization (WTO), hopefully late this year.

"Vietnam has walked one-third of the path to WTO membership. If the negotiation process goes smoothly as planned, we will enter the WTO this year," Vietnamese Trade Minister Truong Dinh Tuyen said recently.

Vietnam has wrapped up bilateral negotiations with 10 out of 27 trade partners, namely the European Union (EU), Japan, South Korea, Singapore, Argentina, Brazil, Cuba, Chile, Uruguay and Columbia, since it began bilateral and multilateral negotiations in 1998.

Talks with the United States are one of the most important bilateral negotiations, Tuyen said, adding that up to date the working parties of Vietnam and the United States have reached an agreement on 60 percent of market opening requirements. Only some minor issues remain before the two sides can conclude bilateral negotiations.

Vietnam and China have conducted six rounds of bilateral negotiations on Vietnam's accession to WTO. The two sides are completing the last work so that they can ink a declaration on the conclusion of the talks during the current visit to China by Vietnam's State President Tran Duc Luong.

The country, which is expected to conclude all bilateral talks on its entry into the WTO before September, is actively preparing for the 10th multilateral negotiation round slated for mid- September.

Entry into the world trade body will offer Vietnam more opportunities, especially in terms of trade, investment, and technology transfer, but pose challenges for the economy's development, as it has to follow the WTO's regulations, including those on tariff reduction, service market openness and intellectual property protection.

To survive the harsh competition, Vietnam has mapped out concrete measures to enhance the capacity and competitiveness of its agriculture, industry and service sectors.

Regarding agriculture, Vietnam will focus on adjusting the agricultural structure, improving farm products' competitiveness, developing production infrastructure, formulating more policies in lines with international practices, and intensifying manpower training.

Vietnam should encourage the establishment of agricultural cooperatives and large-scale farms which involve the whole circle of production from growing, harvesting, to processing, Vietnamese Deputy Minister of Agriculture and Rural Development Diep Kinh Tan said, adding that most of farming activities in Vietnam are done by individual households, which makes it difficulty for mass application of advanced technology.

The deputy minister also stressed that many aspects of the sector are in urgent need of reform, such as farm product distribution system and infrastructure. The system is now slowly and ineffectively operating. Meanwhile, warehouse rentals and transportation fees in Vietnam are still higher than in other countries in the region. (More)

Local farmers should coordinate with enterprises to set up stable material zones, ensure appellations of origins, and improve their products' trademarks, quality and hygiene to raise their competitiveness, he noted, adding that Vietnam has to seek ways of bringing more exports into markets with strict requirements.

In addition, the country should improve its social welfare system and offer stronger vocational training support to local farmers, as some agricultural areas with low competitiveness will die out during the process of trade liberalization, making part of the rural population unemployed, Tan noted.

Agriculture, which made up 20.4 percent of Vietnam's gross domestic product last year, plays a decisive role in ensuring the country's social stability and improving its people's living standard as more than 70 percent of local people are living in rural areas.

For industry, Vietnam will facilitate development of private enterprises, enhance production of items with high competitiveness, and raise products' competitive edges.

The country should accelerate the equitization of state-owned enterprises (SOE), and remove obstacles in credit access faced by private firms, Trade Minister Tuyen said. Recently, it has set a target of restructuring 1,154 SOEs from 2005 to mid-2006, including 1,024 enterprises slated for equitization.

Besides, Vietnam will develop items with high competitiveness such as textile, garment, footwear, and coal, according to the Ministry of Industry.

Specifically, the textile and garment industry will focus on building trademarks, increasing the proportion of locally-made components in export items, and increasing cotton cultivation, said the ministry.

Vietnam plans to invest 2.5-2.7 billion US dollars in its garment and textile industry from now to 2010. The country, home to 26,000 hectares of cotton with annual output of 34,500 tons, is scheduled to pour over 94.9 million dollars in developing its cotton growing areas, aiming to raise the output to 80,000 tons by 2010.

The footwear industry will use more locally-made materials and actively promote trademarks to reduce reliance on imported materials and outsourcing contracts of foreign companies.

Meanwhile, the coal industry will intensify investment in renewing equipment and application of advanced technology, and attach production development with environmental protection, the ministry said.

For industries with weaker competitiveness such as steel, paper and chemical, Vietnam will implement key product development programs and expand production scale.

Regarding service, Vietnam has to work out suitable integration roadmaps, build more legal documents, and improve services' quality, local experts said, adding that some important fields like telecommunications and banking should be given priority.

For telecommunications, the industry needs to learn experiences from China in building technical standards, which are suitable with both international commitments and local enterprises' development, Deputy Prime Minister Vu Khoan said.

To raise its competitiveness edge, the industry will invest more in expanding telecom network and increasing the service's quality. Vietnam will turn the state-owned Vietnam Post and Telecommunications Corporation into a telecoms group. The corporation is actively preparing for the equitization of its two mobile phone service providers, namely VinaPhone and MobiFone.

For the banking industry, Vietnam should offer local financial organizations indirect support, such as helping them improve infrastructure, promote trade and deal with lawsuits with foreign firms, diversify services, increase services' quality, develop new kinds of service, and improve staff's qualification, experts said.

Source: Xinhua