Trade liberalization

1
Trade liberalization

• TR?N THANH H?I
• NCIEC Office
• www.thanhhai.com

• What is the trade liberalization?
• International economic integration
• Trade liberalization in agriculture
• Competition motivation for development
• ... And other issues

2
What is the trade liberalization?

• Trade liberalization and international economic
  integration
• Are those new issues?
• Benefits
• Why are there protests?

3
Trade liberalization in Vietnam

• Reform and open door policies
• Free circulation of commodities
• Decree 57 (1998) removal of business, import
  export rights
• Gradually remove quota, license
• Decree 46 (2001) on 5 years governance of import
  export stability, transperency
• Reform of customs procedures
• Enable access to bank credits

4
International economic integration

• ... Is the continuation of the internal trade
  liberalization
• Removal of barriers between nations
• Tariff
• Non-tariff
• Standards
• SPS measures
• Harmonization of customs procudures...

5
Integration progress

• 7/1995 member of ASEAN
• 1996-2006 implementing AFTA
• 3/1996 founding member of ASEM
• 11/1998 member of APEC
• 12/2001 Vietnam US bilateral trade agreement
  (BTA) came into force
• Negotiating to join WTO

6
Agriculture WTO

• Agreement on Agriculture (AoA)
• Open markets
• Not to increase but reduce gradually export
  sudsidies
• Developed countries by 2001 to reduce tax to 36
  on average
• Developing countries by 2005 to reduce tax to
  24 on average
• Tariffication
• Tariff binding
• Tariff quota (salt, cotton, tobacco)

7
Agriculture AFTA

• AFTA agro-products in the lists
• Inclusion list and temporary exclusion list (IL
  TEL),
• Sensitive list (SL)
• General exclusion list (GEL)

8
Nông nghi?p BTA (i)

• Schedule to phase out quantitative restrictions
  (QRs) to import (Annex B1)
• 4 years beef, milk, corn, plant oil, coffee,
  animal feed.
• 5 years poultry, fruit juices, wines
• 10 years sugar
• Schedule to phase out limitation on import and
  distribution rights (Annex D1) 3 5 years

9
Agriculture BTA (ii)

• Schedule to reduce import tax after 3 6 years
  (Annex E)
• Meat 20 -gt 10
• Cheese 30 -gt 10
• Vegetables (potato, tomato, cabbage, ...) 30 -gt
  20
• Fruits (grape, apple, pear, straberry) 40 -gt
  25-15
• Refine vegetable oil 40 -gt 30
• Processed meat, fish, shrimp, fruit juices,
  mineral water, wine 50 -gt 40 ()
• Beer 100 -gt 80

10
Competition Motivation for development

• Vietnam ranks 62/75 countries on competition
  capacity (WEF, 2001)
• Cheap labor is loosing its advantage, thus the
  sector using lots of labor will get low profits
• Intellectual contents in goods and services keep
  increasing -gt high-techs, skillful workers bring
  about high profits

11
Competition Motivation for development

• Competition at all 3 perspectives
• Nation-wide
• Enterpises
• Goods
• The Law on competition and anti-monopoly is being
  drafted

12
Investment

• WTO - TRIMs
• Requirements on local contents
• Import export and foreign currency exchange
  balance
• Obliged export proportion
• Demands for development of on-the-spot material
  sources

13
Technical barriers

• TBT agreement
• Case studies
• McDonald in India
• Ajinomoto in Indonesia

it is not allowed to formulate, promulgate and
apply technical regulations which create
unnecessary barriers to international trade
14
Sanitary and phytosanitary measures

• SPS Agreement
• Case studies
• Chloramphenical in aqua products

• SPS measures can be applied at required level to
  protect human-being, animals and plants health
  and life
• to rely on scientific base

15
Labor and employment

• Low qualified laborers risking to loose jobs
• Economic structure adjustment together with
  training of high qualified labor

16
Food security

• Open door leads to inter-dependence
• Domestic production is the decisive factor
• Post-harvest technology
• 2001 production value of agro-forestry and
  fisheries sectors increased 4.1

17
Environment

• Implications of environmental measures to trade
• Eco-label
• Packaging
• Fresh vegetables, meat, fish... -gt fresh food
• Environmental destruction means to loose
  livelihood opportunities

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Conclusion
Quick and sustainable economic growth stabilize
and improve living conditions for people.
Strongly adjust economic and labor structures
towards industrialization and modernization.
Increase remarkably effectiveness and competition
of the economy... - Objectives of teh 5 year
plan 2001/2005 -