HANOI: Vietnam could emerge as the single-biggest winner from the recently signed Trans-Pacific Partnership (TPP) trade agreement, according to ratings agency Fitch, with the potential for a significant increase in investment inflows and export opportunities.
Signed on October 5 and expected to come into force at the end of 2017, the TPP will bring Vietnam, Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and the US together into the world’s largest trade bloc, creating a market of 800m people that accounts for 40% of global output.
“Of the 12 countries that are party to the TPP, models suggest that Vietnam would see the biggest benefits in terms of economic impact,” Fitch said in a statement issued in mid-October. “The free trade elements of the TPP will lower tariff barriers, giving Vietnam greater access to large consumer markets in the US, Japan, Canada and Australia.”
The other members of the TPP accounted for nearly 40% of Vietnam’s exports and 23% of its imports last year, according to local media reports, with a study by the US-based East-West Centre estimating that the lowering of trade barriers could see the country’s outward trade volumes increase by up to 37% over a 10-year period, while also reducing the cost of imports.