RCEP to help boost Vietnam’s participation in supply chains – Xinhua
Photo taken on Nov. 6, 2021 shows a train running on the Cat Linh-Ha Dong subway line in Hanoi, Vietnam. (VNA via Xinhua)
A report focusing on the impacts of RCEP on the formation of supply chains in Vietnam has been released, highlighting that RCEP will enhance Vietnam’s participation in regional supply chains, thereby facilitating market expansion and attracting more business. investments.
HANOI, Nov. 12 (Xinhua) — The Regional Comprehensive Economic Partnership (RCEP) will help Vietnam enhance its participation in regional supply chains, Vietnam News Agency reported Friday, citing a new report.
The report on the impacts of RCEP on the formation of supply chains in Vietnam was released Thursday by Vietnam’s National Center for Socio-economic Information and Forecasting (NCIF) and Germany’s Konrad-Adenauer-Stiftung in Vietnam.
With Free Trade Agreements (FTAs) signed among member countries, certain product groups like electronic components, textiles and garments can be traded among RCEP members with very low tariffs, according to the report.
Tariffs have been reduced for some products including supply chains in which Vietnam is deeply engaged, such as textiles, garments, automobiles and some electronic products. Applying consistent rules of origin under the RCEP will help the country strengthen its engagement in regional supply chains.
The shift of supply chains to Vietnam that has already taken place through bilateral FTAs or under ASEAN Plus 6 will be further encouraged by RCEP. Foreign direct investment inflows are also expected to rise even further as major investors in the region step up their specialization to develop supply chains, according to the report.
A farmer works at his dragon fruit farm in Thoi Lai district, Can Tho province, Vietnam, Jan. 26, 2022. (VNA/Handout via Xinhua)
The report also pointed out that RCEP will provide Vietnam with opportunities to improve value addition and productivity by facilitating market expansion, attracting investment in upstream manufacturing sectors and enhancing specialization in industries where the Vietnam has assets. This will in turn attract more foreign direct investment through supply chains to the country and help domestic companies to engage more in global chains.
Luong Van Khoi, Deputy Director of NCIF in the Ministry of Planning and Investment, quoted the report as saying that RCEP will generate many positive impacts on regional economies.
Perhaps the most important thing is the harmonization of rules of origin, which allows accumulation of origin, creating many opportunities and advantages for intra-bloc exports, he said.
Entering into force in January 2022, the RCEP trade agreement includes 15 Asia-Pacific countries, including 10 ASEAN member states, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, and their five trading partners, namely China, Japan, South Korea, Australia and New Zealand.■