CPTPP opens the way for Vietnamese enterprises to participate deeply in the supply chain

Connecting businesses, transferring technology

Compared to other FTAs, CPTPP is quite unique because many members have had bilateral/multilateral FTAs ​​with Vietnam before and businesses are also taking advantage of the incentives of old FTAs ​​with these markets. However, with the implementation of CPTPP, businesses have more preferential channels and advantages to exploit, especially in the context that some CPTPP member countries are traditional sources of input for many manufacturing industries in Vietnam and hold global manufacturing supply chains such as: Japan, Singapore, Australia...

Taking advantage of input materials at competitive prices. And participating in connecting and linking with FDI enterprises to transfer technology, increasing the localization rate when participating in the supply chains of multinational corporations from CPTPP members becomes a prominent benefit for Vietnamese enterprises in the process of taking advantage of opportunities from this Agreement.

Sharing at the Discussion with the theme "Joining the supply chain of FDI enterprises - Increasing the efficiency of utilizing CPTPP" organized by Industry and Trade Magazine on the morning of December 2 in Hanoi in the form of online, Ms. Nguyen Thi Lan Phuong, Department of Multilateral Trade Policy ( Ministry of Industry and Trade ) said that the CPTPP Agreement brings very positive benefits to Vietnam's import-export and investment activities. This is one of three new generation free trade agreements that Vietnam has participated in and the CPTPP Agreement is also the agreement that we have had the longest implementation time of about 5 years up to now.

In the first 9 months of 2024, there were positive results in the growth of import-export turnover between Vietnam and CPTPP countries with about more than 76 billion USD, an increase of nearly 10% over the same period last year, with a trade surplus of about 6.6 billion USD. These are very impressive figures for import-export turnover between Vietnam and CPTPP countries, especially markets that have never had FTAs ​​before.

In addition to increasing the exchange of goods and services, this agreement has attracted FDI enterprises to invest directly in Vietnam, opening up opportunities for Vietnamese enterprises to become links in the global production chain. After the Agreement came into effect, foreign investors from CPTPP members such as Singapore and Japan have actively approached the Vietnamese market to take advantage of opportunities and advantages from CPTPP.

Participating in connecting and linking with FDI enterprises to transfer technology and increasing the localization rate when participating in the supply chain of multinational corporations from CPTPP members has become an outstanding benefit for Vietnamese enterprises in the process of taking advantage of opportunities from the Agreement.

Sharing about this aspect, Mr. Nguyen Thanh Trung, Director of CNCTech Thang Long (CNCTech Group) said that thanks to the association with Japanese enterprises and other multinational corporations, CNCTech Thang Long has developed human resources, improved scientific and technical level, improved product quality, and can compete fairly with foreign companies.

In particular, CNCTech Thang Long, CNCTech Group is fortunate to receive support from the Ministry of Industry and Trade in combination with connections with foreign enterprises, specifically Toyota, which has supported training and consulting to improve the company's technical capacity, professional capacity as well as management capacity. Therefore, the company relies on developments and systems to search for and satisfy demanding customers in the world that Vietnam has rarely been able to meet up to now. In addition, Vinh Phuc province where the company is operating also has support policies and resources to create conditions for Vietnamese enterprises to develop and contact large foreign companies operating in Vinh Phuc such as Huyndai, Toyota, etc.

Toyota Vietnam representative - Mr. Nguyen Trung Hieu, Head of Business Planning Department also said that when implementing the CPTPP Agreement, businesses will have one more option, one more opportunity to consider component sources from Japan or from other members of the Agreement. In the future, when the CPTPP Agreement's application roadmap for the automobile industry reaches 0% around 2030 - 2031, it will also help the company to have better competitiveness in the Vietnamese market.

Deploying many solutions to support businesses

However, in reality, the level of FTA utilization and the proportion of Vietnamese goods in these markets are still relatively limited. The room and opportunities for businesses to take advantage of these FTA markets are still very large, especially those markets that have not had FTAs ​​before. In fact, businesses have partly taken advantage of FTAs; including CPTPP, but due to many different reasons, that utilization is still relatively limited. Currently, most Vietnamese businesses up to now often export raw goods, with very little deep processing. In addition, businesses have not focused on issues of brand building or intellectual property protection in foreign markets. Therefore, combining with FDI enterprises to form a supply chain will help domestic businesses grow faster and shorten the time for better international integration.

Pointing out the current shortcomings, Ms. Nguyen Thi Lan Phuong raised issues in internal capacity, experience, capital and science and technology capacity that have limited the ability of Vietnamese enterprises to take advantage of FTAs. Accordingly, in order for enterprises to be able to meet and join the supply chain of FDI enterprises or expand globally, Vietnamese enterprises will need support from both sides: the internal strength of the enterprise itself and the companionship and support from central and local agencies and departments.

From the business perspective, "for a Vietnamese enterprise to be able to join the FDI chain or be ready to directly exchange with foreign enterprises and partners, the enterprise itself must have many changes to be able to absorb the opportunities in those FTAs", the representative of the Multilateral Trade Policy Department emphasized.

Central and local agencies have also made great efforts in recent times to support Vietnamese enterprises to increasingly improve their capacity and better meet the standards of global corporations to join their systems and supply chains. The Ministry of Industry and Trade, as the focal agency for implementing FTAs, has also promptly implemented many different solutions so that enterprises can take advantage of CPTPP or FTAs ​​in general.

To promote the ability of enterprises to take advantage of CPTPP in general, especially to increase deeper participation in the production chain of enterprises in CPTPP in particular, Ms. Nguyen Thi Lan Phuong affirmed that in the coming time, the Ministry of Industry and Trade will focus on solutions to build an ecosystem to support enterprises to take advantage of FTAs. At the same time, strengthen connections to take better advantage of FTAs ​​and also build a better business ethics culture for Vietnamese enterprises.

Regarding the key solution of building an ecosystem to support businesses in taking advantage of FTAs, including CPTPP, it is expected that by September 2025, the ecosystem to take advantage of FTAs ​​can come into life. "We hope that participating businesses will be businesses that aim for sustainable development, towards branding and fair competition," said a representative of the Multilateral Trade Policy Department, expressing hope that difficulties in exploiting opportunities from FTAs ​​will be partly resolved. The issued ecosystem will mobilize resources from ministries, branches and associations, creating a concentration of resources to exploit FTAs ​​more effectively.

According to experts, to fully exploit the opportunity to attract FDI, investment promotion activities need to shift their focus to approaching potential investors, especially large FDI corporations. That contributes to taking advantage of new-generation free trade agreements and opportunities to participate in the supply chains of multinational corporations, taking advantage of opportunities from the CPTPP market with great potential.

Source: https://moit.gov.vn/tin-tuc/thi-truong-nuoc-ngoai/cptpp-mo-loi-cho-doanh-nghiep-viet-tham-gia-sau-vao-chuoi-cung-ung.html