What Preparations are Needed?

International economic integration has become an inevitable tendency. Viet Nam is in negotiation phase to enter the World Trade Organization (WTO) and likely to become a WTO member in 2006. However, there are still many queries from Vietnamese people in general and Vietnamese enterprises in particular, for example, Should Viet Nam enter WTO? What will happen to Vietnamese enterprises? What shall Viet Nam prepare for WTO accession? At the seminar "WTO accession - Problems Ahead", held by the Saigon Giai Phong Newspaper in Ho Chi Minh City (HCMC) Journalist Association on April 4, 2006, those matters were discussed in details.
 
No debating problem

Dr. Tran Du Lich, Dean of the Institute for Economic Research - HCMC opened the seminar with several concerns of Dr. Le Net's article on Vietnamnet that VN should not enter WTO in 2006 as domestic enterprises are still at a low level of development. The Government needs to have policies to protect domestic production against imported goods. Only when Vietnamese enterprises are strong enough, we should enter WTO.
 

Dr. Tran Du Lich, Dean of the Institute for Economic Research – Ho Chi Minh City, expresses his opinions at the seminar.
According to Dr. Tran Du Lich, this article deserves consideration. However, Viet Nam has to enter WTO as soon as possible. After entering WTO, Vietnamese enterprises will have to compete and hence develop better. So the question now is not to enter or not at this critical moment.
 
He said "Viet Nam pledged to cut down tariffs of more than 700 items from 15-20% to 5% to comply with AFTA/CEPT commitments on July 1, 2003. Many journalists asked whether or not local enterprises would go bankrupt if we reduced tax of many items at the same time. In reality, they did not. Goods produced by ASEAN countries contribute to variety but not replacement of domestic goods. Vietnamese enterprises have an opportunity to compete with markets of regional countries. Economic integration will be a good opportunity for well-organized, dynamic enterprises to do business and develop better, the disorganized, mediocre enterprises to go bankrupt."
 
A lot of participants agreed with his opinion. Ms. Mai Hong Quy, Deputy Principal of HCMC Law University, said resolutely: "It's time for us to join WTO and there's no debate on this issue. If we don't enter WTO, we shall go against the global tendency and consequently we will be left behind."

Four disadvantages of Vietnamese enterprises
 
Vietnamese enterprises’ good characteristics are responsive and adapting themselves to markets easily. However, there are four disadvantages which obstruct Vietnamese enterprises in the process of international economic integration, said Mr. Tran Du Lich. They are poor quality (due to low technology), high production cost, bad product distribution system and slow market supply. 
 
Among those factors, distribution system is most important because who can manage this field, he can control production. 
 
In addition, Vietnamese enterprises’ weak point is that they have yet invested properly in designing products, whereas the world’s consumption market is always sensitive to this issue. 
 
“Vietnamese enterprises also lack competitiveness,” recognized Ms. Mai Hong Quy, “and are weak in many aspects. For instance, their knowledge of the laws seems very opaque. When trade disputes occurred in the country, most of enterprises’ documents were not properly prepared at the first stage. No matter how good a lawyer is, he still cannot help enterprises win the dispute.” 
 
What shall we prepare to enter WTO?
 
In light of all the Vietnamese enterprises’ shortcomings, Mr. Vo Hong Son, Deputy Editor-In-Chief of the Sai Gon Giai Phong Newspaper, put a question: What do we need to prepare for WTO entrance?
 
The State and enterprises have to change their ways of thinking and acting in the new stage, said Dr. Tran Du Lich. The State has to organize sources to get and supply enterprises with information on consumers’ taste, goods prices, and point out competitors at every specific market. 
 
Also, the State has to organize human resource training classes for enterprises. The State should provide infrastructure investments to assist enterprises in investment expenditure reduction, helping them make products at a competitive price. Those issues have been done very well in China.
 
According to Dr. Nguyen Xuan Te, Deputy Principal of HCMC School for Government Officials, the State’s role in the integration process is finding out practical demands of market to design an appropriate action program.
 
Mr. Nguyen Manh Cuong, representative of Investment and Trade Promotion Center (ITPC), said the Center is stepping up development of such programs as promoting 20 key trademarks to help enterprises compete in foreign markets, cooperating with the Ministry of Trade to set up a retail distribution system for some domestic enterprises, and training professional instructors for small and medium businesses to help them enhance competitiveness.
 
Ms. Mai Hong Quy emphasized building staff who are highly qualified in job skills and foreign languages is one of the prerequisites for helping enterprises in competition in the era of international economic integration.

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