Local firms lack knowledge of TPP trade agreement

Thursday, Sep 26, 2013 10:07

Twelve countries are currently participating in the TPP negotiations: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. The TPP countries represent a market of more than 792 million people and a combined GDP of $27.5 trillion—more than 38 percent of the world's economy. — File Photo

HA NOI (Biz Hub)  — Business experts have warned that local Vietnamese enterprises still do not have a clear understanding of the Trans-Pacific Partnership Agreement (TPP), while foreign firms are preparing to take advantage of the trade agreement through strategic investments in Viet Nam.

Lam Thuy Ai, deputy general director of Mebipha, a company producing medicine to safeguard animals and seafood products in southern Tay Ninh Province, said her company planned to expand its business to neighbouring countries in the coming years.

However, she admitted that the company may face challenges in meeting the development criteria of the TPP, as she was unaware about what the deal will involve.

Le Quang Hung, chairman of the Sai Gon Production and Trade Joint Stock Company (Garmex Sai Gon), said he also had little information about the TPP, although he knew that it would help his company broaden their market.

However, opportunities to learn more bout the TPP for him have been limited because there have been no detailed statements given about the partnership agreements following each round of negotiation, he said.

Local media had failed to provide adequate official information about the TPP, he added.

Van Duc Muoi, chairman of Vissan Ltd Company, said when tariffs are abolished under the TPP, local firms would face fierce competition from rivals and a reduction of market share. He warned that their lack of understanding left them at risk of serious damage when Viet Nam finally joins the TPP.

Luong Van Ly, head of the Trade and Investment Division of the Viet Long Thang Law Ltd Company, said the state should provide useful information about the TPP for local firms to help them increase competitiveness in plenty of time.

Ai said each enterprise should study the regulations of the TPP when they are made available in order to get an advantage.

Meanwhile, foreign companies already started investing in Viet Nam in anticipation of the tax advantages that will arrive with the TPP.

TAL, a textile and garment company from Hong Kong, has twice sent representatives to provinces in the north of Viet Nam with a view to opening a factory in the country.

C.K Sun, TAL strategic director, said Hong Kong enterprises have paid attentions to investment opportunities in the textile and garment industry because the industry would be given many advantages to export to the US once the TPP is signed among member countries.

Viet Nam Textile and Garment Group (Vinatex) said more than 10 firms from Japan, Hong Kong and Taiwan planned to co-operate with them in building factories producing fibre, dyes, textiles and garments.

Diep Thanh Kiet, deputy chairman of the Viet Nam Leather and Footwear Association, an expert in the textile, garment, leather and footwear industries, said the state should have reasonable policies for developing this sector to avoid a situation where only foreign firms would enjoy advantages from the TPP when the deal is agreed. — VNS

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