Photo: Viet Tuan
World Bank releases report on benefits to Vietnam from Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
by Linh San
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The World Bank released a report on March 9 stating that the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), signed by its eleven member nations in Santiago, Chile on March 8, will yield robust economic gains for Vietnam.
According to the report, entitled Economic and Distributional Impacts of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership: The Case of Vietnam, multilateral trade agreements such as the CPTPP are expected to further boost Vietnam’s investment and export driven growth model.
“Even under conservative assumptions, the report estimates that the CPTPP would increase Vietnam’s GDP by 1.1 per cent by 2030,” according to Mr. Ousmane Dione, World Bank Country Director for Vietnam. “Assuming a modest boost to productivity, the estimated increase in GDP would amount to 3.5 per cent from the CPTPP.”
All income groups are expected to benefit, though higher-skilled workers in the top 60 per cent of income distribution may reap more. The anticipated increase in foreign direct investment (FDI) is expected to lead to a further expansion in the services sectors and boost productivity growth. It will also create opportunities for domestic private companies to integrate into global value chains and promote the development of the small and medium-sized enterprise (SME) sector.
“The new agreement will bring direct benefits to Vietnam, from trade liberalization and improved market access,” said Mr. Sebastian Eckardt, World Bank Lead Economist for Vietnam. “Most importantly, it will help stimulate and accelerate domestic reforms in many areas. Delivering commitments under the CPTPP will contribute to promoting transparency and supporting the creation of modern institutions in Vietnam.”
The CPTPP is expected to stimulate reforms in areas such as competition, services (including financial services, telecommunications, and the temporary entry of service providers), customs, e-commerce, the environment, government procurement, intellectual property, investment, labor standards, legal issues, market access for goods, rules of origin, non-tariff measures, and trade remedies, etc.
The report is supported by the Australia - World Bank Group strategic partnership (ABP II), which supports Vietnam’s development agenda through technical assistance, capacity building, and analytical work. “Together with the World Bank, we are committed to helping Vietnam take advantage of the substantial economic opportunities created through the CPTPP,” Australian Charge d’Affaires Rebecca Bryant said. “This includes assistance to enhance competitiveness, reduce trade barriers, and improve connectivity.”
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