TPP will be ‘light at the end of tunnel’ for Vietnam’s automobile industry: expert
The Trans Pacific Partnership Agreement (TPP) brings a ray of hope to the
Without TPP membership, the automobile industry would not exist after 2018, when it has to open the domestic market widely to imports from ASEAN.
However, TPP may make the
The negotiation about the required TPP-made content ratio in car products with preferential tariffs was one of the toughest.
Meanwhile, the US and Japan, the two big manufacturers in the TPP bloc, wanted lower ratios, 50 and 32.5 percent, respectively, so that their car manufacturers can take the initiative in seeking car part suppliers. Besides, a high percentage of Japanese cars are made in non-TPP countries such as
Finally, the 12 member countries of TPP agreed that the required ratio would be 45 percent.
Dong believes that in the new circumstances,
Vietnamese manufacturers need to have four important characteristics to be able to join the ‘automobile world’ – quality, price, delivery time, and creativity & development.
TPP offers way out for Vietnam
TPP is believed to be ‘powerful’ enough to help Vietnam escape the difficult situation it will fall into when Vietnam has to cut import tariffs to zero percent from 2018 under the ASEAN Free Trade Agreement (AFTA).
According to Dong, in the immediate time, it is necessary to create favorable conditions for foreign investors to make car parts to serve the assembly of car models in TPP countries. Investments in technologies, equipment and management technology will be very useful for
In the next stage of development,
In the current global context and under