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Vietnam Today

Planning the key as AEC approaches

Released at: 16:33, 11/12/2015

Planning the key as AEC approaches

Conference hears of efforts Vietnam must make in knowledge and awareness of the ASEAN Economic Community.

by Quynh Nguyen

“Compared with other countries in the ASEAN Community, Vietnam is behind both in awareness and concrete actions in taking part in the ASEAN Economy Community (AEC),” Deputy Prime Minister and Minister of Foreign Affairs Pham Binh Minh told a conference on the ASEAN Community and Vietnam’s Action Plan on December 11.

The AEC is a very important milestone for Vietnam and other countries in the region, he went on, and a common interest for all ASEAN countries.

However, according to a recent survey by local experts and the ASEAN Economic Commission, awareness among people and enterprises in Vietnam about the opportunities and challenges remains low, especially compared with other countries such as Thailand, Malaysia, and Singapore.

Mr. Nguyen Son, Deputy Director General of the Interagency Steering Committee for International Economic Integration, said at the conference that ASEAN countries have many free trade agreements (FTAs) so when businesses invest in ASEAN they also have the opportunity to access the markets of ASEAN countries that have FTAs with the country of their investment.

“Foreign enterprises who invest in Vietnam will benefit from the region and from other countries with which Vietnam has signed FTAs,” Mr. Son said.

Economic expert and former Deputy Chairman of Vietnam Chamber of Commerce and Trade, Ms. Pham Chi Lan, said that most Vietnam enterprises are yet to be fully aware of the challenges the AEC present and are not ready to take advantage of the opportunities.

Vietnamese enterprises are optimistic and believe that the increasing movement of workers, reductions in trade barriers, and increasing investment flows will enhance competitiveness. “However, the fact is that Vietnamese businesses are not ready to compete with their rivals in the region, especially in the labor market,” she said. “Only 40 per cent of enterprises fully understand the implications of the AEC for their business.”

Most experts at the conference agreed that it is important for the government to introduce support programs to improve and disseminate knowledge to the business community about the AEC. “It is necessary to have innovation mechanisms, a consistent legal framework, and transparency, creating a favorable environment for businesses and investment,” Ms. Lan added.

On November 22, leaders from the ten members of ASEAN signed a declaration officially establishing the ASEAN Economic Community as part of a larger ASEAN Community that aims for political, security, cultural, and social integration.

“Internal competition among ASEAN countries to attract investment flows will not ease. When the AEC is formed some foreign investors will be likely move to other ASEAN countries because they no longer enjoy high tariff protection in Vietnam. This will be one of the biggest challenges for Vietnam in joining the AEC.”

Mr. Nguyen Son, Deputy Director General of the Interagency Steering Committee for International Economic Integration

“Vietnam has made a lot of effort to develop in its 20 years in ASEAN but it is still among the poorest countries in the ASEAN 4. Without strong reform to create a good business environment, as advanced ASEAN countries have, Vietnamese businesses will remain behind those of other ASEAN countries.”

Ms. Pham Chi Lan, economic expert and former Deputy Chairman of the Vietnam Chamber of Commerce and Trade

  • TAGS
  • ASEAN Community
  • AEC
  • Deputy Prime Minister and Minister of Foreign Affairs Pham Binh Minh
  • challenges
  • opportunities

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