Vietnam faces challenges in promoting trade facilitation

Vietnam is facing numerous difficulties and challenges in promoting trade facilitation, said experts at a forum in Ho Chi Minh City on November 8.
Vietnam faces challenges in promoting trade facilitation ảnh 1At the event (Photo: VNA)
HCM City (VNA) – Vietnam is facing numerous difficulties and challenges in promoting trade facilitation, said experts at a forum in Ho Chi Minh City on November 8.

Trade facilitation is not only a commitment of Vietnam when joining free trade agreements (FTAs) but also a measure to raise businesses’ competitiveness and efficiency of their import-export activities, they said.

FTAs may have significantly reduced import tariffs in many markets for Vietnamese goods, but administrative reform, reduction of trading costs and improving the business environment are key to improving national competitiveness, they added.

Nguyen Anh Duong, head of the Central Institute for Economic Management’s macroeconomics policy department, said Vietnam’s trade facilitation rankings are middling in the world and in ASEAN, and far behind neighbouring nations like Thailand, Malaysia and Singapore.

In the World Bank’s trading across borders rankings, Vietnam is 94th out of 190 countries, in the World Economic Forum’s enabling trade index, it is 73rd out of 136 nations and in the World Bank’s logistics performance index, it ranks 64th out of 160.

“The Government aims to transform progressively specialised inspection from largely ex-ante inspection to largely ex-post inspection in line with risk management principles and regulatory compliance of individuals and entities,” he said.

It is hoped basically to eliminate the incidence of one goods being subject to management and specialised inspection by more than one agency, reduce the number of goods subject to specialised inspections by at least 50 percent and reduce the import batches subject to specialised inspections for custom clearance from the current 25 – 27 percent to below 10 percent.

It plans to fully electronise administrative procedures via the National Single Window and ASEAN Single Window.

According to Ngo Chung Khanh, deputy head of the Ministry of Industry and Trade’s multilateral trade policy department, said FTAs have enhanced the competitiveness of enterprises through market access and increased exports.

He cited the example of the textile industry where non-WTO import duties were 150 percent, but when a nation joined the WTO, it went down to around 25 percent. Under FTAs, the figure fell to 0 -5 percent, he said.

Export turnover has sharply increased from 5.4 billion USD in 2006 to 213.8 billion USD this year.

“FTAs have promoted administrative reform by the Government, improved infrastructure, ensured equality in accessing resources, removed barriers to accessing markets, and simplified conditions for business,” he said.

They also provide assured market access since the WTO is facing many challenges. Vietnam’s FTAs are in all five continents and that would help limit risks.

FTAs have reminded enterprises about the potential of the domestic market of over 90 million people and created opportunities for Vietnamese firms to participate in global supply chains, he said, citing that right now there are 200 domestic companies supplying accessories to Samsung.

Such deals have brought opportunities to Vietnamese enterprises in the context of increasing international protectionism, but Vietnam must overcome challenges by speeding up administrative reform and improving its business and investment environment, said Khanh.

At the forum, the Vietnam information trade portal at was launched, covering information and regulations related to export/import/transit.

The event was co-organised by the HCM City Institute for Development Studies and the HCM City International Integration Support Centre in collaboration with the Central Institute for Economic Management, who plan to make it an annual event.

It attracted 300 attendees, including officials from HCM City, related ministries and departments, international organisations, business groups, universities, and research institutes from HCM City and neighbouring provinces.-VNA

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