Thursday, 23 May 2019

Current world developments require Vietnam to be proactive and pragmatic

Updated at Wednesday, 05 Dec 2018, 16:04
The Hanoitimes - Global uncertainties remain a huge concern for Vietnam’s economy, particularly the growing protectionism, trade tension between the US and China, and the Brexit.
The global new context requires Vietnam to be proactive and pragmatic, which are key to minimize any negative impacts, according to Deputy Prime Minister Vuong Dinh Hue. 
Illustrative photo.
Illustrative photo.
In 2018, Vietnam continued to accelerate the negotiations and signing process of new trade agreements, in turn contributing to the overall socio-economic development, Hue said at the Vietnam International Economic Integration Forum 2018 held on December 4. 

Vietnam’s trade turnover in 2018 is projected to reach US$475 billion, of which exports climbed 11.2% year-on-year to US$239 billion. Notably, Vietnamese enterprises’ FTA utilization rate in 2018 has reached 40%, up from 35% recorded last year. 

The result showed that local companies have been taking advantages of those FTA better, Hue said. 

However, there remains difficulties during the process of global economic integration, including the lack of linkage and cooperation between the FDI sector and domestic enterprises, especially the small and medium ones, Hue continued. 

Do Thang Hai, deputy minister of Industry and Trade, said Vietnam has made a breakthrough in the preparation process for new trade agreements. Recently, Vietnam’s National Assembly ratified the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).

Additionally, Vietnam and EU wrapped up the legal review process for the Vietnam-EU FTA in June 2018, paving the way for the signing of the deal. 

However, global uncertainties remain a huge concern for Vietnam’s economy, particularly growing protectionism and trade tensions between the US and China, and the Brexit. 

Sudhir Shetty, the World Bank’s senior economist, said Vietnam has to bolster its economic resilience against external shocks, at the same time enhancing its national competitiveness and restructuring trade and investment sectors. 

Shetty suggested flexible monetary policy should be key to ward off negative impacts caused by volatility of the world’s financial and trade markets. 

Vu Minh Khuong, lecturer at National University of Singapore, said that due to a high level of economic openness, Vietnam would be one of the most vulnerable countries should the global economy slow down. 

Khuong suggested Vietnam should give priority to institutional reform in addition to market expansion. Moreover, the country should hold a pioneer role in facilitating free and fair trade, while avoiding the risk of falling into the trap of trade protectionism and rising to the challenges of digital revolution. 
Ngoc Thuy
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