Leveraging CPTPP advantages to boost exports: Opportunities for Vietnamese businesses

DNHN - The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) opens up new opportunities for Vietnamese businesses. By expanding and increasing exports, Vietnamese businesses can access a larger and more diverse market.

According to the Ministry of Industry and Trade, the CPTPP has provided a significant boost to Vietnam’s export growth. The CPTPP came into effect for Vietnam on 14 January 2019. Before that, in 2018, Vietnam’s total exports to countries in the bloc amounted to 39.5 billion USD. By the end of 2023, this figure had increased by 20 billion USD, reaching 50.5 billion USD. Vietnam’s trade balance with the CPTPP bloc has consistently been in surplus.

This is a remarkable growth rate, given that during this period, the global economy and trade in general, and trade between Vietnam and its CPTPP partners in particular, faced many challenges such as economic downturn, disease, and geopolitical conflicts.

Thus, after five years of implementation, Vietnam’s exports of goods to this market bloc have recorded a significant increase, but it has not been uniform, with the main focus still on a few key markets such as Canada, Japan, Singapore, Malaysia, and Australia. Meanwhile, exports to Peru, New Zealand, and Brunei have been low, at less than 1 billion USD per year.

Accordingly, the CPTPP has opened up a larger market for Vietnamese businesses, with 10 member countries, including developed economies such as Japan, Canada, Australia, and Singapore. This has created opportunities to reach millions of new consumers and expand export volumes. This large market is particularly important as Vietnam strengthens its international integration and expands multilateral relations.

With commitments to reduce or eliminate tariffs on many export products, especially Vietnam’s key products such as garments, agricultural products, and seafood, the CPTPP helps Vietnamese businesses reduce export costs, increase competitiveness, and enhance access to demanding markets. Increased exports will generate foreign exchange earnings, boost production, and create jobs, contributing to economic development and improving people’s lives.

Specifically, the CPTPP requires member countries to comply with international quality standards and technical regulations. This requires Vietnamese businesses to improve product quality and production processes, thereby building trust and affirming their brand in the international market. Compliance with these standards will also help domestic businesses improve their production processes and enhance product quality, thereby increasing their competitiveness in both domestic and foreign markets.

In addition, the CPTPP creates a favourable environment for attracting foreign direct investment (FDI). Increased FDI will not only help improve technology, production processes, and management but also create new jobs and career opportunities for Vietnamese workers. This will increase labour productivity and contribute to the country’s economic development. The CPTPP is not just a trade agreement, but also a comprehensive economic integration mechanism. Participation in the CPTPP will require Vietnamese businesses to comply with international regulations and standards, thereby promoting the reform of mechanisms, fostering development, and enhancing the competitiveness of businesses in the integration process.

Furthermore, the CPTPP provides a mechanism for the protection of intellectual property rights and dispute resolution. This helps Vietnamese businesses protect their products and brands from unauthorised copying and unfair competition. Moreover, the CPTPP also provides regulations on investment and investment-related dispute resolution, creating a stable and reliable legal environment for foreign investors.

Taking advantage of the preferential treatment under the CPTPP will bring many opportunities and benefits to Vietnamese businesses. From expanding markets, reducing export taxes, and improving product quality, to encouraging foreign direct investment and promoting economic integration, these are important factors in enhancing competitiveness and increasing exports of businesses. Vietnamese businesses should seize this opportunity and accompany the development of the CPTPP to promote economic growth and enhance their position in the international market.

Nhan Ha Phan