Domestic businesses expect positive impacts by CPTPP

Hanoi (VNA) – Many domestic businesses expect the newly signed CPTPP will bring positive effects on Vietnam through the expansion of export market along with access to the abundant materials sources in CPTPP member countries.

Nguyen Van Sua, Vice Chairman of the Vietnam Steel Association, was of the view that both TPP and CPTPP would have positive impacts on the domestic steel industry rather than negative ones.

He explained that several CPTPP members import large volumes of steel products, and the removal of tariff barriers will help Vietnamese steel exporters extend their markets. At the same time, some CPTPP member countries, for example Australia,  have abundant sources of materials needed by the steel industry such as iron ore and coal, which will give Vietnam easier access to materials, machinery and technology in the industry.

Sua added that negative impacts do exist, though not large, as competition in the steel industry among CPTPP members is not particularly fierce.

He said in order to optimise opportunities brought by the CPTPP, domestic steel manufacturers should carefully study the deal’s content and rules to avoid unnecessary risks, while continuing to increase the content of technology in products along with productivity and environmental protection.

The mechanical sector is facing bigger problems as it is at a disadvantage compared to that in other CPTPP members, according to General Secretary of the Vietnam Association of Mechanical Industry (VAMI) Dao Phan Long.

Long forecast that there are two directions ahead for the sector, either to continue doing outwork for foreign partners or to enter joint ventures to access technology, management know-how and markets. Which direction to take will depend on the Government’s orientation for the sector and the enforcement of ministries, agencies and the business community itself.

He noted that many small-sized enterprises face the risk of collapse if they fail to seek linkages and new markets.

To assist domestic firms, the government should define concrete development orientations and priorities for the mechanical sector to help businesses devise their investment strategies.

Another sector to be affected strongly by CPTPP is the garment-textile industry.

Truong Van Cam, vice chairman of the Vietnam Textile and Garment Association (VITAS), said the sector hopes to benefit from the deal, which provides opportunities for Vietnam to reach other markets aside from the US.

He stressed that increasing added value will be an effective way for the sector to make the most of incentives offered by CPTPP.

According to General Director of the Ho Guom Garment JSC Phi Ngoc Trinh, after the signing of CPTPP, garment-textile firms will have bigger chances to enter the Australian and Canadian markets, but the question is whether they can meet those markets’ requirements.-VNA