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Vietnam’s Economy

Autor:   •  January 10, 2018  •  Business Plan  •  2,287 Words (10 Pages)  •  169 Views

Page 1 of 10

Package 1

Q1: What are strengths and weaknesses of export?

Strengths

  • The openness of Vietnam’s economy has increased from 144% (2007) to 173% (2016).
  • Vietnam has joined free trade area, the majority of exported goods would enjoy preferential import-export taxes treatment, even at 0%, this may bring huge competitive advantages and chances for many categories and industries, especially textiles, footwear, seafood, furniture, those key export sectors listed in top 10 major export products.
  • Political, social and financial stability
  • Good geographic location in a dynamic region, having attracted many large corporations.
  • Abundant production factors (labor, agricultural, fishery and forestry resources). Especially, Vietnam holds advantages to agricultural products like coffee, rice, vegetables.
  • Relatively low labor costs and disciplined labor force

Weaknesses

  • Many key sectors such as textile, leather and footwear are outsourcing, while the other agricultural items – one of the strengths of Vietnam – are exported in raw form from which added value earned is not significant.
  • Small-scale, inadequate infrastructure, decentralized enterprises, backward production technology, limited business management competencies, low market competitiveness
  • Low added value of export goods is mainly caused by utilizing natural resources and low-priced labor.
  • Vietnam’s trade deficits from near markets and unstable trade surplus is
  • Corruption and inefficient bureaucracy
  • High cost of skilled-labor compared to other countries in region
  • Low productivity and low quality products
  • High inland transaction costs compared to other countries in the region
  • Limited know-how in design and marketing and lack of branding for agricultural products
  • Large gap between rural and urban industries
  • Slow VAT rebate process of the government

Q2: Give some suggestions to boost these activities in the following years.

  • Fully utilize established economic communities
  • Promoting exports through policies
  • Develop logistics system as a foundation for promoting exporting activities
  • Utilize the e-commerce platform for conducting online exporting activities

Package 2

Q1: What are strengths and weaknesses import?

Strengths

  • Structure of imported commodity is changing in the effective way
  • VN is expanding the trading relationship with over 200 nations and regions over the world.
  • The regulation and trade law is becoming adequate and complete. Many policies issued in order to control importing activities and the trade balance effectively

Weaknesses

  • Imported commodities is used inefficiently, many items are not suitable for using in Vietnam or considered as “waste”
  • Lack of links between sectors and industries in VN to form a full supply chain
  • Management is lacking in consistency. The problem of smuggling, copyright issue and trade fraud has become serious.
  • Lack of big-scale co-operation and effective control
  • High inflation relative to other countries producers to do importation
  • Trade deficit is still the problem of Vietnam economy. The biggest trade deficit market of Vietnam is China

Q2: What Vietnamese commodities are threatened by imports?

  • Agricultural products (fruit, vegetables, meat)
  • Steel
  • Textile and garment

Package 3

Q1: How is an anti-dumping case initiated, investigated and concluded under the WTO’s legal framework? (Present the key points)

Step 1: File a lawsuit (with initial evidence).

  • Requirements: evidence of dumping, injury and causation, as well as other information regarding the product, price, industry, importers, exporters, etc.
  • An application shall be rejected and an investigation terminated promptly as soon as the authorities concerned are satisfied that there is not sufficient evidence of either dumping or of injury to justify proceeding with the case
  • When authorities initiate without a written application from a domestic industry (ex officio), they shall proceed only if they have sufficient evidence of dumping, injury and causal link to justify initiation

Step 2: Decision on whether to initiate the case.

  • Determination: Dumping is calculated on the basis of a “fair comparison” between NORMAL VALUE and EXPORT PRICE.
  • The investigating authority will have to determine the "like product" in the domestic market of the exporter.
  • Dumping is to be condemned if it causes or threatens material injury to an established industry in the territory of a contracting party or materially retards the establishment of a domestic industry.
  • A product is to be considered as being introduced into the commerce of an importing country at less than its normal value, if the price of the product exported from one country to another less than….(at this point onward, you are recommended to read the Article on Anti-dumping, GATT 1994. In this we will understand MARGIN OF DUMPING, CALCULATION OF NORMAL VALUE, MATERIAL INJURY, and CASUAL LINK)

Step 3: Preliminary investigation

  • To determine if the allegation is valid using questionnaires completed by the interested parties to compare the foreign producer's export price to the normal value.

Step 4: Conclusion

  • If the foreign producer's export price is lower than the normal price and the investigating body proves a causal link between the alleged dumping and the injury suffered by the domestic industry, it comes to a conclusion that the foreign producer is dumping its products.

Step 5: anti-dumping measures

Step 6: Review anti-dumping measures

Q2: What should Vietnamese government and exporters do to avoid antidumping measures?

  • Enterprises need to improve their understanding and knowledge of laws and regulations on anti-dumping and anti-dumping measures, especially those of WTO
  • Vietnam’s experience has shown that industry associations can play an important role.
  • Upgrade their technology, strengthen their competitiveness, and improve their product quality.
  • Accelerate Government institutions’ reviewing, amending, supplementing, and drafting of legal documentations related to Vietnam’s anti-dumping and anti-dumping duties.
  • Support enterprises in their efforts to cope with anti-dumping issues.
  • Improve human resources for implementing anti-dumping regulations and duties.

Package 4

 Q2: How does Vietnamese government stimulate exporting activities in terms of taxes?

Financial supports for export activities:

  • Export subsidies
  • State export credit
  • Exchange rate policy

Tax incentives

  • Tax reduction
  • Tax exemption
  • Tax refund

Indirect tax tools

  • 0% VAT
  • Import duty exemption

Additional tax treaties

  • Double taxation avoidance
  • Foreign contractor tax
  • Natural resources tax
  • Environment protection tax
  • Corporate income tax
  • GSP

Package 5

Q1: Why is Donald Trump against the TPP trade deal?

Trump’s viewpoints and motives:

  • Designed for big corporations at the expense of commoners
  • Corporations are given the power to sue governments
  • Harsher provisions on intellectual properties
  • Freedom of internet
  • Threat of patents rules from pharmaceutical firms
  •  Move jobs out of US and lower wage
  • In favour in bilateral deals
  • Currency manipulation

Q2: What expected benefits Vietnamese economy may lose when the US government quit the TPP?

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