Vietnam aims for WTO in 2005

Vietnam aims for WTO in 2005

Entering the final year of its 2001-05 socio-economic development strategy, the government of Vietnam increased the growth target of the economy for 2005 to approximately 8.5% in an effort to meet the goal of its five-year development plan. In order to accomplish the task Vietnam must register at least 16% export growth, from $26 billion in exports in 2004 to $30.2 billion in 2005. The country’s policy of economic openness paid dividends over the past decade. Poverty dropped from levels as high as 70% in the 1980’s to nearly 25% in 2004. In 2004, the industrial production of the country increased 16% from 2003. Total export turnover rose 29%, while total import turnover increased 25%. Investments grew 17%, and make up 36% of overall GDP. Vietnam has been modifying its trade laws and tariffs system since 2001 in an effort to become more competitive in the global market. The country entered into the Common Effective Preferential Tariff and ASEAN Free Trade Area in 2002. The country made amendments on the tariff structure to keep tariffs under a certain cap. The country agreed to an average tariff rate of 18%, 4% lower than its previous offer. It ratified the Ordinance on the Anti-dumping of Imported Goods on April 29, 2004. The ordinance opens the door for the application of various anti-dumping measures, such as temporary tariffs on imports and a commitment from importers to stop dumping. Although the initial plan for Vietnam’s accession to the World Trade Organization (WTO) called for the country to be admitted at the beginning of 2005, the government has not yet lost hope on entering the organization in 2005. The government expects to complete the negotiations with the remaining member countries by the second half of the year. The remaining countries seek more concessions, and it looks likely that Vietnam, although unwillingly, will accept more concessions in return for membership to the WTO. The economies surrounding Vietnam are also experiencing a boom period, which may make the things tougher for Vietnam as it tries to meet its export and growth target for 2005. Furthermore, the 34% drop in the efficiency of investment may pose a stumbling block.