FTA in the context of global economic crisis

On March 14, 2013, the University of Social Sciences and Humanities in collaboration with the Rosa Luxemburg Foundation organized a workshop: “The development of Free Trade Agreements (FTAs) in the context of the global economic crisis - the perspectives of the EU and ASEAN”.The workshop was attended by Associate Professor Dr. Pham Quang Minh (Vice Rector), Representative of the Rosa Luxemburg Foundation in Vietnam, along with many scientists from international agencies, organizations, universities and academies in the country and abroad. The presentations at the workshop analyzed in depth the process of forming AFTAs, the advantages and challenges of Vietnam and ASEAN when participating in FTAs. In the context of global economic integration, participating in FTAs ​​has become an inevitable need for each country. Vietnam has joined AFTA since 1996 and since then, Vietnam has negotiated and participated in many regional and bilateral FTAs ​​with different forms and contents. As of 2012, Vietnam has participated in 6 regional FTAs ​​including: ASEAN Free Trade Area Agreement (AFTA), ASEAN - China (ACFTA), ASEAN - Korea (AKFTA), ASEAN - India (AIFTA), ASEAN - Australia and New Zealand (AANZFTA), ASEAN - Japan Comprehensive Economic Partnership Agreement (AJCEP); 2 bilateral FTAs ​​Vietnam - Japan, Vietnam - Chile and is promoting negotiations to sign more important FTAs ​​such as: TPP, Vietnam - EU FTA. In the paper "Free Trade Agreements (FTAs): Characteristics, trends and impacts on Vietnam", Associate Professor, Dr. Ha Van Hoi (University of Economics, VNU Hanoi) stated that FTAs ​​have a great impact on Vietnam. Typically, the Vietnam - European Union Free Trade Agreement (FTA) negotiation round has been officially expected to help 90% of tax lines for Vietnam's export goods to this market, along with increasing the capital flow of the European Union into Vietnam. In addition, participating in FTAs, Vietnamese enterprises can reduce costs, especially tax reduction and investment policies. Thus, when implementing commitments in FTAs, trade activities will be promoted more strongly, as well as bringing more safety in the investment process of enterprises, trade barriers will gradually decrease, promoting a strong development of Vietnam in the future. According to the report “ASEAN Free Trade Agreement (FTA): Concepts and policies” by Associate Professor, Dr. Pham Thanh Binh (Institute of World Economics and Politics), the purpose of signing FTA of Vietnam is the same as other ASEAN countries, which is to increase exports, create attractiveness to attract foreign investment, strengthen the position and build the national image in the international arena. FTA also has the effect of increasing pressure for innovation and improving competitiveness. In addition, the discussions said that participating in many FTAs ​​will create too many intertwined commitments and regulations, making it difficult to plan national trade policies and comply with and implement FTA commitments and regulations. However, if not joining this trend, Vietnam and ASEAN will suffer discrimination and risk facing the “trade diversion” effect, causing export industries with competitive advantages to not be able to promote their effectiveness. Therefore, in the context of global integration, Vietnam as well as other countries in the ASEAN region need to clearly identify the characteristics and trends of FTAs ​​in the world and the region. That will be the key for Vietnam and other countries to have effective participation, contributing to serving the economic development of their countries.