Vietnam assembly ratifies WTO membership
HANOI - Vietnam's national assembly has ratified the country's accession as the 150th member of the World Trade Organisation, a key step in bringing one of the world's last communist states into the global economy.
The WTO on November 7 gave Vietnam the green light to become its 150th member. Membership will be formalised 30 days after Hanoi informs the Geneva-based group that its legislature has approved the accession.
Prior to the vote, President Nguyen Minh Triet called on the assembly to back Vietnam's membership in the global trade club, saying it "will directly impact Vietnam's economic relations with other WTO members and the global economy."
"It will offer us big opportunities in domestic and foreign investment and help elevate the position of Vietnam in the world."
Deputies in the 496-seat assembly -- almost all of them members of the Communist Party -- voted on the bill from 4:00 pm (0900 GMT), said a spokesman. Wednesday is the final day of the assembly's autumn session.
Vietnam, which this month hosted a major Asia-Pacific summit of world leaders, has gone to great lengths to join the WTO and integrate its booming economy into the international trading system.
Economic growth in Vietnam topped eight percent in 2005 and is expected to do so again this year, making the emerging market of 84 million people East Asia's fastest growing major economy after that of its giant neighbour, China.
Many investors have been abuzz about the country often touted as a "China light" for its large, young and highly literate work force, its low wages and the social stability brought by authoritarian rule.
The enthusiasm has been fed by recent news that the world's largest chip maker Intel will build a one-billion-dollar plant in the southern commercial hub and port of Ho Chi Minh City, the former Saigon.
But long-time observers of the country have warned that Vietnam, having passed scores of WTO-compliant laws, still faces tough hurdles as it adapts to the harsher realities of the free trade age.
Critics point at red tape, corruption and infrastructure bottlenecks, and warn that inefficient state-owned enterprises will have to shape up or go under as more foreign companies crack into their markets.
Trade Minister Truong Dinh Tuyen, who led the negotiations, said "joining the WTO will help Vietnam maintain its strong growth" and make the investment environment "more transparent, more healthy and more stable."
"By joining WTO, we sent a strong message abroad on our commitment to 'doi moi' (renewal) and reform," he said.
But he also warned that economic globalisation increased wealth gaps between and within countries and would have a "negative impact on parts of our domestic production and our population."
"The business environment in Vietnam will be more fierce in many sectors. Competition will cause serious difficulties and challenges to some of them," the minister said.
"Joining the WTO will also create new issues in national security, cultural identity and environmental protection."
Under the new rules -- negotiated over more than a decade with the United States and other trade partners as well as the WTO itself -- Vietnam must scrap a range of tariffs, subsidies and other barriers that protect local industries.
In return, Vietnam, a major exporter of textiles, footwear, electronics, rice, seafood and coffee, will face fewer hurdles in selling its goods abroad and recourse through the WTO in case of trade disputes.
Agence France Presse - November 28, 2006.
Vietnam ratifies WTO membership
Vietnam's legislature has ratified its entry into the World Trade Organisation (WTO), paving the way for the country to become the group's 150th member.
The overwhelming National Assembly vote in favour of the move, came three weeks after it was invited to join the WTO.
The move will give the country more access to overseas markets but will force it to cut high import tariffs.
Vietnam is Asia's strongest performing economy after China. Its economy is expected to grow by 7.8% in 2006.
"WTO membership will bring about tremendous opportunities for Vietnam," President Nguyen Minh Trie said.
"It also creates momentum to boost foreign investment and elevates Vietnam's status in the international community."
Increased competition
Vietnam's membership of the group will come into effect on 28 December. It has been trying to join the trade group for more than a decade.
While the legislature welcomed the development, trade minister Truong Dinh Tuyen warned it would also mean that Vietnamese businesses would have to face up fierce international competition.
"Products against products, businesses against businesses. The pressure will be on each business, household and organisation," he said.
"Some businesses will even face bankruptcy."
However, he added that WTO membership would also lead to the removal of textile trade quotas and a more "transparent and flexible business environment" which should attract more foreign investment.
Communist-run Vietnam, which has a population of 84 million, is one of the fastest growing economies in the world after China.
The Asian Development Bank expects its economy to grow by 7.8% this year.
BBC News - November 28, 2006.
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