Vietnam enjoys export growth to America after three-year participation in CPTPP

28/10/2022    132

According to the assessment, in three years, Vietnam as a member country has taken advantage of the Comprehensive and Progressive Agreement for the Trans-Pacific Progress (CPTPP) market quite well to increase its market share in America in comparison with other partners that have also ratified the CPTPP.

The assessment was given at the seminar ‘Taking advantage of the leverage of CPTPP to increase exports to the American market’ held by the Ministry of Industry and Trade today in Hanoi.

According to the Ministry of Industry and Trade, after three years of implementation, many types of Vietnamese goods have been increasing exports to the Americas market region thanks to the CPTPP.

In the first eight months of 2022, export turnover between Vietnam and CPTPP member countries reached US$41 billion, up 38.7 percent over the same period in 2021. In the opposite direction, Vietnam's import turnover from the region in this sector reached $35 billion, up 17.2 percent over the same period in 2021. Trade surplus after eight first months was recorded at $6 billion, the highest level after this FTA had taken effect while during the first years of implementation of the CPTPP, the two-way trade balance has been the same.

According to Ms. Nguyen Thi Thu Trang, Director of the Center for the World Trade Organization and Integration of the Vietnam Chamber of Commerce and Industry (VCCI),  the CPTPP is not Vietnam's first free trade agreement, but it is the first trade agreement to aim at the Americas market. Before that, we had the Vietnam - Chile Free Trade Agreement but it was a traditional agreement on a small scale.

With the CPTPP, for the first time, the Southeast Asian country has had access to two markets in South America - Peru and Chile – along with two markets in North America - Canada and Mexico. It has offered a great opportunity for Vietnam to access new markets, with many potentials and certain challenges, said Ms. Trang.

Ms. Trang disclosed that while other countries have seen a decline in their market share or their market share stayed flat; even Japan, which used to be familiar with the American market, has seen a flat market share, Vietnam’s market share has increased.

Vo Hong Anh, Deputy Director of the Ministry of Industry and Trade’s European - American Market Department, also affirmed that before the CPTPP took effect in 2019, Vietnam's export volume to this market area was quite limited, but after the CPTPP took effect, local goods shipped to countries in Americas have grown dramatically.

Regarding the structure of Vietnamese exports to this market, she said that the group of phones and components accounts for about 20 percent, the group of electronics and computers accounts for about 16 percent while machinery and spare parts account for about 9 percent and the proportion of the group of textiles and garments, thick leather is also high.

Through the CPTP, textile and garment and footwear are two groups of goods that have a tariff advantage of up to 10 percent-20 percent compared to other direct competitors, said Ms. Anh.

For example, Canada committed to completely eliminating tariffs, bringing them to zero percent after three years of the agreement coming into force for the textile and garment industry. As a result, in the first nine months of 2022, Vietnam's textile and garment export to the Canadian market grew by more than 50 percent compared to the same period in 2021, said Ms. Hong Anh.

Similarly, most seafood products in Vietnam are also committed to bringing the tax back to zero percent. The country is present as the largest shrimp and pangasius fish exporter in Canada with pangasius fish accounting for 80-90 percent of the market share in Canada. Similarly, pangasius fish export growth to Mexico has seen an increase of over 70 percent in the past eight months. Currently, Mexico is one of the three largest pangasius fish importers of Vietnam.

Ms. Anh disclosed that Vietnam is also exporting a large volume of items such as bags, umbrellas, suitcases, and processed agricultural products such as tea, coffee, pepper, and cashew, and is also gradually dominating the CPTPP markets in the Americas region.

Ms. Vo Hong Anh also said that the CPTPP not only helps us to expand new markets for exports but also helps take advantage of businesses to diversify their sources of imported goods, avoiding dependence on some traditional markets like before.

In the past time, businesses have experienced disruption of the logistics chain; therefore, the Ministry of Industry and Trade will coordinate with ministries and agencies to find solutions, and explore new direct transport routes to increase connectivity for businesses in this area.

At the same time, the Ministry of Industry and Trade will continue to promote solutions for information systems, and early warning for businesses, as well as support businesses to handle arising problems, handle risks of trade barriers, and trade remedies that Vietnamese exports may encounter.

Source: SGGP News