Vietnam has seen its exports to other countries that have ratified the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade deal stabilise in 2020 despite the impact of COVID-19, new figures have shown, but many firms are still said to be failing to take full advantage of the deal.
In 2020, the value of shipments to Canada, Australia, Japan, Mexico, New Zealand and Singapore stood at $34 billion, the same as in 2019. VN Express reports this indicates how the country has benefited from the agreement to boost trade in spite of the severe impact of the pandemic.
However, officials have suggested that the potential benefits of CPTPP could be even greater, but many businesses are not making full use of the agreement.
Nguyen Cam Trang, deputy director of the Ministry of Industry and Trade's Agency of Foreign Trade, noted that while overall exports grew by 8.4 percent in 2019, shipments to CPTPP members only increased by 7.2 percent. She attributed this to the fact many exporters are unaware of the tariff benefits offered by the trade deal.
This was echoed by director of the Vietnam Chamber of Commerce and Industry's WTO and Integration Centre Nguyen Thi Thu Trang, who said: "Only one out of four companies said it knows exactly what the CPTPP is and the benefit it brings. And the majority of firms which understand the CPTPP are foreign-owned."
CPTPP came into force in Vietnam in January 2019, with the country's trade ministry estimating it will add 1.32 percent to Vietnam’s GDP and 4.04 percent to its exports by 2035, as well as creating up to 26,000 jobs.
However, these benefits may only be achieved if more work is done to educate exporters about the new opportunities afforded by the deal.
For instance, VN Express noted exports of leather and footwear goods to CPTPP members has increased by 13 percent in the last two years, with Canada and Mexico becoming two important new markets.
Phan Thi Thanh Xuan, vice chairwoman of the Vietnam Leather and Footwear Association, explained: "Instead of exporting to a third country and re-exporting to Mexico and Canada, Vietnam's leather and footwear products can now be shipped directly to the two countries thanks to the CPTPP."