A yarn production line of the Ha Nam Textile Co. Ltd in Phu Ly city, Ha Nam province. (Photo: VNA) Luong Van Khoi, Deputy Director ofthe NCIF under the Ministry of Planning and Investment, cited the report assaying that the RCEP will generate many positive impacts on regional economies,helping raise the region’s income by some 0.6% by 2030, equivalent to 245billion USD each year, and create 2.8 million jobs annually.
Recent studies also pointed out thatVietnam will benefit much from this agreement, he said, elaborating that theWorld Bank forecast the country’s GDP will increase by about 4.9% and exports11.4% by 2030.
Apart from the commitments of atraditional free trade agreement (FTA), the RCEP also includes those one-commerce, telecommunications, competition, small- and medium-sizedenterprises (SMEs), and public procurement, among others.
The most important thing may be the harmonisationof rules of origin, which enables the accumulation of origin, creating manychances and benefits for intra-bloc exports, Khoi noted.
The report said due the FTAspreviously signed among many member countries, some groups of commodities likeelectronic components, textiles and garments among RCEP members have already benefitedfrom very low tariffs, so this deal’s impacts are inconsiderable.
However, tariffs have been reduced forsome goods whose supply chains Vietnam has engaged deeply into such as textiles,garments, automobiles, and some electronic products. The application ofconsistent rules of origin under the RCEP will help the country boost itsparticipation in regional supply chains.
The shift of supply chains to Vietnamthat has already been taking place thanks to bilateral FTAs or within the ASEANPlus 6 framework will be further promoted by the RCEP. Foreign direct investment (FDI) inflows are alsoexpected to grow even more when major investors in the region are stepping up specialisationto develop supply chains, according to the report.
It also pointed out that the RCEP will provide opportunities for Vietnam to improveadded value and productivity by boosting market expansion, attractinginvestment to upstream manufacturing sectors, and enhance specialisation in theindustries where Vietnam has strengths. That will in turn attract more FDI undersupply chains to the country and help domestic enterprises further engage inglobal chains.
The RCEP was signed in 2020 between the Association of Southeast Asian Nations(ASEAN) and five partners, namely Australia, New Zealand, China, Japan, and theRepublic of Korea. Taking effect since January 1, 2022, it is the largest FTAat present, covering 30% of the global GDP.
Under this agreement, about 90% ofthe tariff lines will be eliminated within 20 years since it came into force./.
VNA
