"This is an important step in the process of reviewing documents and recognizing Vietnam's market economy status," Ministry of Foreign Affairs spokesperson Pham Thu Hang replied to Tuoi Tre at a regular press conference on the afternoon of May 9.

Pangasius fillets of Nam Viet Group are processed and packaged for export to the US - Photo: THAO THUONG

On the night of May 8, the US Department of Commerce (DOC) held a hearing via online format related to reviewing the application for recognition of Vietnam's market economy status.

Participating in the hearing were representatives of the Vietnamese Government (Ministry of Industry and Trade, Ministry of Foreign Affairs, Vietnamese Embassy in the US) and a number of parties involved in the case. Stakeholders welcomed the fact that DOC held the hearing. Because this is an important step in the process of considering recognition of market economy status for Vietnam.

Persistently giving many arguments and data

According to information from Tuoi Tre, at this hearing, the representative of the Vietnamese Government clearly stated arguments, information, and data; affirmed that Vietnam's economy fully meets the six criteria of market economy regulations according to US law.

At the same time, it emphasized that Vietnam's economy has developed even more rapidly than many economies that have been recognized by the US with market economy status in the past decade.

"We will continue to discuss and cooperate closely with the US side in this issue," a representative of a ministry participating in the hearing affirmed.

Especially in the current context when Vietnam has also signed more than 90 bilateral trade agreements and about 60 investment promotion and protection agreements. Vietnam is also a member of 16 free trade agreements (FTAs) with the participation of about 60 economies.

Among these, there are many new generation FTAs such as CPTPP and EVFTA that meet high standards in traditional areas such as trade in goods and services and new areas such as labor and environment; Government procurement, transparency, investment dispute resolution mechanism, state-owned enterprises.

As noted, the contents discussed at the recent hearing were the tireless efforts of the parties. Because since 2008, Vietnam and the US have established a bilateral Working Group on market economy issues (Structural Issues Working Group - SIWG); organized 10 technical sessions to exchange information according to the six criteria set by the US, to keep you updated on the strong progress of Vietnam's economy in recent years.

From there, it creates a foundation for the US to recognize and reconsider the market economy issue for Vietnam.

Criteria include: Currency conversion level; Issues of salary and wage negotiation between employees and employers; Level of foreign investment in economic activities; Issues of state ownership and private ownership; The degree of government control over certain resources, prices, and other factors.

Shared with Tuoi Tre, a representative of the Trade Defense Department; The Ministry of Industry and Trade said that throughout this process, the Ministry of Industry and Trade has closely coordinated with ministries, branches, associations and business communities at home and abroad to analyze and synthesize information at the request of the DOC on the positive changes in Vietnam's economy.

It emphasizes the level of openness of the economy, trade policy, monetary policy, foreign investment and progress in integration that meets the above six criteria.

In fact, the issue of the market economy is one of the important contents that the two countries are interested in and was included in the joint statement on upgrading Vietnam - US relations. Especially in the context that our exports to the US are increasing (total turnover in 2023 reaches 97 billion USD, the first four months of the year are estimated to reach 34.12 billion USD).

Processing shrimp for export at Saigon Seafood Trading Joint Stock Company - Photo: QUANG DINH

Vietnamese exported goods will benefit

The recognition of market economy status, according to leaders of the Ministry of Industry and Trade, has great significance for Vietnam's manufacturing and export industries; creating an equal competitive advantage between our goods and the exported goods of other countries when the trade defense tax rate accurately reflects production practices in Vietnam.

Especially for trade defense cases, recognition of market economy regulations is particularly important. Because in the case of anti-dumping investigation of Vietnam's exports when we are still considered a non-market economy, normal price calculation principles will not be used.

The investigating country will use a third country to calculate the replacement price when calculating the dumping margin, causing the dumping margin to often be very high, not accurately reflecting Vietnam's production practices.

This creates a huge disadvantage for exported goods when they cannot compete with exported goods from other countries," the above leader said.

As for cases of US investigation against tax evasion and anti-subsidy on Vietnamese exports; This country will apply the method for countries with non-market economies to calculate production costs in Vietnam to determine whether the assembly or finishing process in Vietnam is significant or not.

When Vietnam is considered a non-market economy, it will allow DOC to apply tax rates nationwide; Based on available data, it was pushed to a very high level, equivalent to a ban and maintained in all reviews, hindering the consideration of lifting the tax order.

Therefore, leaders of the Ministry of Industry and Trade affirmed that the US's early recognition of Vietnam's market economy status will contribute to concretizing the commitments of the two countries' senior leaders; Strengthen the comprehensive strategic partnership between Vietnam and the US. Thereby promoting bilateral economic, trade and investment cooperation, bringing practical benefits to businesses and people of the two countries.

Workers harvest bananas at a banana garden in Dong Nai for export abroad - Photo: A LOC

Many prestigious American organizations support Vietnam

Sharing from the US, Commercial Counselor - Head of the Vietnam Trade Office Do Ngoc Hung said at the hearing chaired by the DOC; Vietnam has shown our efforts in meeting the six criteria to recognize a market economy.

Mr. Hung said that considering recognizing Vietnam as a market economy will demonstrate the US government's consistent policy stance after the two countries upgrade their comprehensive strategic partnership in 2023. This also demonstrates the image of Vietnam as a reliable partner in the region, consistent with the US's policy of diversifying supply chains and promoting investment.

According to Mr. Hung, the time from now until July 26, when the US makes an official decision, will be a very important period, requiring the strongest and most drastic mobilization of all levels through many channels. Although there are still many big challenges, Mr. Hung believes that with the direction of the Government, Vietnam's ministries and branches have implemented the campaign in a comprehensive, focused and focused manner.

In particular, promptly provide information to most sympathetic partners who share benefits with Vietnam (both domestically, in the US and other partners); helps convey information systematically and thoroughly on this issue. Thereby, partners basically acknowledge and can provide appropriate support.

In fact, during the period of submitting comments and criticisms to the DOC before the hearing, there were more than 70 comments opposing and more than 40 comments supporting Vietnam's market economy.

Notably, among the supportive opinions are comments from prestigious and vocal American organizations such as the American Chamber of Commerce (AmCham); US-ASEAN Business Council (USABC); American Retail Industry Association (RILA), American Association of Importers and Exporters (AAEI), American Agricultural Association (NASDA), American Textile, Apparel and Footwear Association (AAFA)...

Lots of fun and opportunities Is a group that processes and exports pangasius and is present in more than 30 countries around the world; Nam Viet Group (Long Xuyen City, An Giang) is currently exporting pangasius to the US with a tax rate of 0% (only applied in 2024). According to the leader of this group, if Vietnam is recognized as a market economy, export businesses like Nam Viet will benefit greatly. "If Vietnam is recognized as a market economy, it would be great, it would promote the whole industry and create competitive opportunities for exporters in Vietnam. Nam Viet alone will have a fair game with other businesses," said the representative of the above group. Sharing more about the above issue, Mr. Truong Dinh Hoe - general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP) - also said that there is an opportunity but the road is still far. When recognized as a market economy, the method and method of tax rates may be different. The tax rate is lower but it can also be higher, not in a market economy where the tax rate goes to 0%. For example, India is a market economy but the anti-dumping tax on exported shrimp is higher than Vietnam. This is complicated and far from... "But I admit that with the trend of a market economy, the most basic advantage is that Vietnam will be like other countries, doing business better. Next is the advantage with trade dispute lawsuits, when it is a market economy, the reflection will be more accurate, without litigation in anti-dumping. If Vietnam has a non-market economy, taking other countries as a reference may be right or wrong. When entering the same field, Vietnam will be equal with other countries and economies; will be a major partner of the US, competing fairly with other countries; be treated fairly in all commercial matters," Mr. Hoe said. In addition to seafood, Vietnamese fruits and vegetables are present in over 60 countries and territories, with 10 main markets including the US. According to Mr. Tran Van Nam (enterprise purchasing vegetables and fruits for export), among the groups of agricultural, forestry and aquatic products, the US buys the most cashew nuts, seafood, wood, fruit... from Vietnam. However, to enter the US market, products must be subjected to extremely strict quarantine. "In short, it's very strict. But when it's a market economy, businesses and gardeners will be satisfied. Specifically, export output increased, high value, great competitiveness and brand with Americans. Instead of before, Vietnamese fruits entering the US were only favored by Asians," Mr. Nam explained.

Many foreign businesses support Vietnam During a regular press conference on the afternoon of May 9, responding to Tuoi Tre about the above issue, Foreign Ministry spokesperson Pham Thu Hang said Vietnam welcomed the US Department of Commerce for holding the hearing. At the hearing, the Vietnamese side clearly stated arguments, information and data to confirm that the Vietnamese economy completely meets the criteria of market economy regulations. Representing the Ministry of Industry and Trade of Vietnam at the hearing is lawyer Eric Emerson from Steptoe LLP law firm based in Washington (USA). Mr. Emerson emphasized that Vietnam should be upgraded to a market economy because it has met the six criteria of the US Department of Commerce. He also pointed out that Vietnam is doing better than other countries that have been recognized by the US as market economies; less intervention in state-owned enterprises than India and more open to foreign investment than Indonesia, Canada or the Philippines. Samsung Electronics is one of the companies supporting the US raising Vietnam to market economy status. At the hearing, Mr. Scott Thompson, public policy director of Samsung Electronics US branch; affirmed that the company has become one of the largest employers in Vietnam thanks to Vietnam's market-oriented changes. "They have emerged as a stable, secure supply chain partner for the US, ultimately benefiting the US economy," he said. The support of foreign businesses for Vietnam can also be seen before the hearing. Mr. Ted Osius, former US ambassador to Vietnam and currently chairman of the US-ASEAN Business Council, which has more than 70 members who are leading US and world corporations, even emphasized: "Vietnam has Market economy". On Reuters News Agency, he argued: "Vietnam has met important criteria such as currency convertibility and readiness to be recognized with official status. American businesses have invested significantly in Vietnam because they recognize the country's development potential." According to Ministry of Foreign Affairs spokesperson Pham Thu Hang, in fact so far, 72 countries have recognized Vietnam as having a market economy, including large economies such as England, Canada, Australia, Japan... Vietnam has also participated in 16 bilateral and multilateral free trade agreements with more than 60 partners, spread across continents. "The US's early recognition of Vietnam's market economy status will contribute to concretizing the commitments of the two countries' senior leaders, strengthening the Vietnam - US comprehensive strategic partnership; thereby promoting economic and trade relations, bringing practical benefits to businesses and people of the two countries," the Foreign Ministry spokesman argued.

Langbiang Farm, Da Lat prepares lettuce for export - Photo: M.V.

Recognizing the market economy in Vietnam is beneficial to the US In an article posted on the website of the highly prestigious Center for Strategic and International Studies (CSIS) in the US; Expert Murray Hiebert emphasized that the time is right for the US to recognize Vietnam as having a market economy. He pointed out that economic reforms with Vietnam have brought the country into destinations open to foreign business and today; Vietnam has become a "big magnet for attracting FDI" as companies shift supply chains. Regarding the US, Mr. Murray Hiebert cited the fact that American companies such as Apple and Intel have established large factories and research centers in Vietnam, and Hanoi is also among Washington's top 10 trading partners.Vietnam is also a partner in negotiations promoted by the US to establish the Indo-Pacific Economic Framework; member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership from which the US withdrew. "Many global economies, including Japan, Australia, the UK and Canada, have recognized Vietnam as a market economy. The fact that the US continues to consider Vietnam a non-market economy is counterproductive for a country with which Washington has deep economic ties and increasingly strong security cooperation. The next logical step in US-Vietnam relations should be for the Ministry of Commerce to recognize Vietnam as having a market economy next July," Mr. Murray Hiebert wrote on CSIS.

According to: Ngoc An, Thao Thuong, Duy Linh, Thanh Hien - Tuoi Tre Newspaper