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Unique opportunity to escape the developing status
Date: 5/23/2020 7:54:46 AM
The flow of international investment flows along with the global chain rearrangement, since the US-China trade war was triggered and especially before the impact of the Covid-19 pandemic, will it help? Does Vietnam have a chance to rise out of developing countries?

 
 

 

Vietnam is a promising destination for the wave of factory relocation from China after Vietnam has made different and successful things in the fight against the Covid-19 pandemic. Artwork of Ngoc Linh.

Hands of attention

During the May 2020 meeting, the National Assembly will consider, discuss and proceed to ratify the Vietnam - European Union Free Trade Agreement (EVFTA). This result is of great significance, especially in the context that EU countries are starting to reopen the economy, many businesses are looking for more new markets to have the opportunity to overcome difficulties soon. towels after a period of stagnation due to disease.

This will be the 13th FTA of Vietnam that took effect from 1993 to the present. In addition, Vietnam is also negotiating 3 other FTAs, the Regional Comprehensive Economic Partnership (RCEP); Vietnam - EFTA includes Switzerland, Norway, Iceland, Liechtenstein and Vietnam - Israel FTA. It can be seen that our country has never actively participated in free international trade activities and actively integrated so deeply.

Samir Dixit, CEO of Brand Finance Asia-Pacific, said that Vietnam should not waste the opportunity to build national brand assets, by showing the ability to produce products that The world is in great need at the moment.

But the information that made many people most excited recently is probably the event that Vietnam, along with two other countries, South Korea and New Zealand, were invited to participate in the discussion with the group of four diamond members (Quad) of the four members, the United States. , Japan, Australia and India, on issues such as vaccine development, challenges from citizens being stuck in host countries, trade coordination, and supply chain restructuring to minimize the impact on the economy. Global.

With the addition of Vietnam, South Korea and New Zealand to join from 20-3 this year, the Quad is now called the Quad Plus.

Knowing that Quad originated in 2004, four members from the United States, Japan, Australia and India formed the Regional Core Group, but were later forgotten in 2008 and then. came back from the end of 2017 when US President Donald Trump outlined a free and open Indo-Pacific strategy, replacing the previous Asia-Pacific axis goal. US key policy in Asia, to play an important role in US national security and interests in the region.

The core objective of the new strategy is to build an axis of "quartet" of four major countries, the United States, Japan, Australia and India, to restrain and prevent China’s rise in the region. gain the right to dominate and control the entire Indo-Pacific region, ensure free and fair trade, an open investment environment, effective state supervision and freedom of navigation, and consolidate the foundation. peace and prosperity for the region.

According to analysts, after US President Donald Trump withdrew from Trans-Pacific Partnership Agreement (TPP) two years ago, the rebuilding of this prosperous economic network of the US to counterbalance the Agreement Regional Comprehensive Economic Partnership (RCEP), led by China and expected to be signed in 2020, as well as China’s "Belt and Road" Initiative (BRI), which challenges the role. US leader in the Indo-Pacific region.

For its part, China also believes that the US is seeking through Quad Plus to move its supply chain out of China as quickly as possible, and that this is detrimental to China.

There make good use of opportunities?

Capital flows from China have been affected by trade war and disease outbreaks, but it is also partly due to the fact that many of the country’s projects have reached the stage of disposal and the Chinese government does not want to expand or invest more. Therefore, investors are forced to seek alternative countries, so the selection of projects is of utmost importance.

The fact that Vietnam - the only developing country so far, invited to join Quad Plus is probably surprising many people.

However, looking at the FTAs ​​that Vietnam has continuously signed for many years, strongly attracted the flow of international investment flows, deepened its participation in global trade and supply chains, and its role and position. The increasing position in the international arena, having a strategic geographical position in the region, relations with the "quartet" in general and with the US in particular are increasingly upgraded and deepened, so opportunities for Vietnam The male is very big.

Since the US-China trade war broke out until the recent Covid-19 pandemic, Vietnam has attracted a great deal of attention from the international community, as US President Donald Trump has repeatedly mentioned through the lines. His Twitter. Just a year ago, President Donald Trump warned of an "escape" of investors present in China that the new destination could be Vietnam.

More recently, in early April, he thanked the Vietnamese Government for creating favorable conditions for logistics and approvals to speed up the delivery of personal protective equipment to the US, to address the emergency medical personnel of this country.

Strengthening the relationship with major countries through agreements, network of relations, will bring a lot of benefits to Vietnam if it takes advantage of opportunities, from political and economic security of Vietnam. Vietnam is more assured when it is able to diversify partners and markets, reduce the dependence on a certain market, until continuing to promote attraction of foreign investment, creating conditions for improvement. labor skills and competitiveness, strengthening internal resources.

According to a report of US News & World Report, Vietnam ranked 8th in the ranking of the world’s best economies to invest in 2019, up 15 places, from 23 in 2018. According to the Company AT Kearney Consulting, Vietnam ranks 6th among 30 countries with the potential and level of investment attraction in the global retail sector.

This is also an opportunity for Vietnam to increase its national brand, narrowing the gap between per capita income and developed countries. According to economic experts, this pandemic may pull some economies down but it is also an opportunity for many other economies to rise if there is a solution to cope with risks and make good use of the crisis opportunity. panic brought.

In the May report, the World Bank said that “Vietnam is a promising destination for the wave of factory relocation from China after Vietnam has done something different and successful. in the fight against the Covid-19 pandemic. " Samir Dixit, CEO of Brand Finance Asia-Pacific, said that Vietnam should not waste the opportunity to build national brand assets, by showing the ability to produce products that The world is in great need at the moment. Prime Minister Nguyen Xuan Phuc also recently affirmed, "Covid-19 is a pandemic, but it is an opportunity for Vietnam to develop if it knows the state management organization well, good business, good cooperation".

Reform and appropriate approach

Vietnam must accelerate the process of digital transformation before the effects of the recent epidemic. Artwork by Le Hoang.

To seize this great opportunity, analysts believe that Vietnam should continue to push up institutional reforms, especially focusing on developing health and education conditions, ensuring sufficient human resources of high quality. For the next stage of development, select investment projects with high levels of gray matter and high technology, when the opportunity to receive foreign capital this time is considered to be greater than ever, not only from Korea and Japan. Version, ... which may be from big US corporations like Apple.

At the same time, resources should be concentrated for planning, developing infrastructure, removing bottlenecks for growth and attracting investment, improving governance and policy transparency. Mr. Ousmane Dione, Country Director of the World Bank in Vietnam, said that Vietnam should have more stronger measures, such as promoting investment disbursement, especially public investment, besides accelerating the transition process. number before the impact of the recent epidemic.

The Country Director of the Asian Development Bank (ADB) in Vietnam, Eric Sidgwick, believes that Vietnam needs to improve its policies further to support innovation. A more favorable legal corridor will help Vietnam develop services in both depth and breadth.

However, there are a few things to keep in mind. Firstly, capital flows from China are affected by trade war and disease outbreaks, but it is also partly due to the fact that many projects in the country have reached the stage of disposal and the Chinese government does not want to expand. , investment for benefits, low value chain, so investors are forced to seek alternative countries, so the project selection is of utmost importance.

Second, pushing the U.S. Indo-Pacific strategy will inevitably collide with China’s BRI initiative, which political analysts think risks putting the region under tension. , permanent competition, especially in "hot spots", such as the South China Sea, the East China Sea, the Taiwanese territory (China) and the Korean peninsula, make the arms race in the area tended to Increasing direction, more complicated happenings.

Tuesday, 2020 US presidential election will have results in early November. The question is whether in case Mr. Trump is not elected and a new president is up, is the Indo-Pacific strategy or the Quad Plus program still a priority and continue to be implemented? It should be remembered that when Mr. Trump replaced Mr. Obama, the TPP Agreement that Obama had spent many years pursuing, was removed from Mr. Trump’s agenda.

Or even in the case of Mr. Trump’s re-election, it is unlikely that the program will continue to be promoted, because it does not exclude the possibility that he is only using this strategy to attract attention to score points with voters. for re-election.

Therefore, for Vietnam, the most important thing is that when participating in regional cooperation, it is necessary to have appropriate strategies and approaches to not only take advantage of opportunities and ensure national-ethnic interests. , but also to make sure not to fall into a vortex, compete for interests among powers.

(Source:TBKTSG)
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