MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY MASTER THESIS CURRENT SITUATION AND RECOMMENDATIONS FOR THE IMPLEMENTATION OF THE WTO TRADE FACILITATION AGREEMENT IN VIETNAM Specialization: International Trade Policy and Law MAI HONG NGOC Hanoi – 2020 MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY MASTER THESIS CURRENT SITUATION AND RECOMMENDATIONS FOR THE IMPLEMENTATION OF THE WTO TRADE FACILITATION AGREEMENT IN VIETNAM Major: International Economics Specialization: International Trade Policy and Law Code: 8310106 Full name: Mai Hong Ngoc Supervisor: Assoc. PhD Trinh Thi Thu Huong Hanoi - 2020 STATEMENT OF ORIGINAL AUTHORSHIP I hereby declare that this master thesis is my own scientific research which is made under the guidance of my supervisor, Assoc. Trinh Thi Thu Huong. The contents and results of this research are completely honest.
The information, data and documents which are collected from various sources for analysis and evaluation have been fully cited in the main content and in the references list of this master thesis as well. Student, Mai Hong Ngoc CONTENTS ACKNOWLEDGEMENTS. i LIST OF TABLES. ii LIST OF FIGURES.
iii LIST OF ABRREVIATIONS. OVERVIEW OF TRADE FACILITATION AGREEMENT. Overview of Trade facilitation. Definition of Trade facilitation.
Benefit of trade facilitation. Trade facilitation indicators. Overview of Trade Facilitation Agreement. Process of Trade Facilitation Agreement’s negotiation in WTO.
Structure and content of Trade facilitation agreement. Benefits of Trade facilitation agreement. Implementation of Trade Facilitation Agreement in WTO countries. The ratification process of the Trade Facilitation Agreement in Viet Nam.
The ratification processes. Vietnam commitments in implementing the Trade Facilitation Agreement .32 CHAPTER 2: CURRENT STATUS OF TRADE FACILITATION’S IMPLEMENTATION IN VIETNAM. Current status of the implementation of Category A in Vietnam. The publication and availability of information (Article 1.
Opportunities to comment and Information before Entry into Force (Article 2). Procedure for appeal or review (Article 4). Disciplines on fees and charges imposed on or in connection with importation and exportation (Article 6. Release and clearance of goods (Article 7.
Movement of goods intended for import under customs control (Article 9). Formalities connected with importation, exportation and transit (Article 10. Freedom of transit (Article 11. Current status of the implementation of Category B in Vietnam.
The publication and availability of information (Article 1. Other measures to enhance impartiality, non-discrimination and transparency (Article 5. Penalties Disciplines on Fees and Charges imposed on or in connection with importation and exportation (Article 6. Release and Clearance of Goods (Article 7.
Formalities connected with importation, exportation and transit (Article 10. Freedom of transit (Article 11. Current status of the implementation of Category C in Vietnam. Publication of information through the Internet (Article 1.
Test procedures (Article 5. Release and Clearance of Goods (Article 7. Border agency cooperation (Article 8). Formalities connected with importation, exportation and transit (Article 10.
Freedom of transit (Article 11. Evaluating the current implementation of the TFA in Vietnam. Achievements that Vietnam has completed in the implementation of the TFA. Difficulties of the implementation of TFA in Vietnam .73 CHAPTER 3: RECOMMENDATIONS FOR VIETNAM IN IMPLEMENTING TRADE FACILITATION AGREEMENT.
Benefits of Vietnam in the implementation of Trade Facilitation Agreement. Orientation of Vietnam in implementing the Trade Facilitation Agreement in upcoming period. Recommendations for Vietnam in implementing the TFA Agreement83 3. Recommendations for Vietnamese government and public authorities.
Recommendations for Vietnamese Customs in particular .96 LIST OF REFERENCES .102 i ACKNOWLEDGEMENTS In order to complete this master thesis, I have been received enthusiastic guidance and support from my lectures, family and colleagues. From the bottom of my heart, I would like to express my thanks to them. Firstly, I would like to express the sincerest thanks to my supervisor, Assoc. Trinh Thi Thu Huong who has supported, guided and encouraged me during the completion of this master thesis from choosing the topic, outlining the main ideas, turning those ideas into this thesis to editing this paper.
Without his enthusiastic and excellent guidance and support, I could not have completed this master thesis. Also, I would like to express my special thanks to all lectures of the Master of International Policy and Law program, Foreign Trade University as well as World Trade Institute who gave me the chance to broaden my humble horizon in the field of economics and laws. Last but not least, I would like to express my warm thanks to my family, my colleagues and my friends who never stop supporting, encouraging and giving me the favorable conditions to complete this master thesis. ii LIST OF TABLES Table 1.1: Benefits of trade facilitation to governments and both buyers and sellers 8 Table 1.2: The OECD trade facilitation indicators .3: TF Measures “Clarify and Improve” Aspects of the GATT .4: Technical measures to facilitate trade in the Agreement.
Articles of Category A, B and C of Vietnam. 34 iii LIST OF FIGURES Figure 1.1: LDCs Notification for all categories of provisions .2: DCs notification for all categories of provisions. Share of Categories A, B, C in Vietnam. Types and share of requested technical assistance of Vietnam.
Time and Costs of Trading Across Borders .2: Time and Costs of Trading Across Borders, Vietnam .76 iv LIST OF ABRREVIATIONS Abbreviation Full name ADB Asian Development Bank AFTA ASEAN Free Trade Area APEC Asia – Pacific Economic Cooperation ASEAN Association of South East Asian Nations CPTPP Trans-Pacific Partnership Agreement FDI Foreign Direct Investment FTA Free Trade Agreement GATT The General Agreement on Tariffs and Trade GDVC The General Department of Vietnam Customs ICC The International Chamber of Commerce LCD Least Developed Member States MARD The Ministry of Agriculture and Rural Development MOF The Ministry of Finance MOH The Ministry of Health MOIT The Ministry of Industry and Trade MOST The Ministry of Science and Technology MOT The Ministry of Transport NSW National Single Window OECD The Organization for Economic Co-operation and Development SDT Special and differential treatment SME Small and medium enterprises v SW Single window TF Trade Facilitation TFA Trade Facilitation Agreement TRS Time Release Study TPP Trans-Pacific Partnership UNCTAD United Nations Conference on Trade and Development VN-EAEU Vietnam - Eurasian Economic Union Free Trade Agreement FTA WB World Bank WCO World Customs Organization WTO World Trade Organization vi ABSTRACT Trade facilitation plays a key role in international trade and trade supply chains, which is also an important issue of the world in general and Vietnam in particular. The new WTO Trade Facilitation Agreement (TFA) is a significant step forward for the international trading regime, representing new hope for the relevance of the WTO. Joining in international trade, therefore, Vietnam has to fully comply with commitments regulated in the TFA Agreement. With topic “Current Situation and Recommendations for the implementation of the WTO Trade Facilitation Agreement in Vietnam”, the thesis focuses on the current application of the TFA Provisions into the legislation and implementation in Vietnam in order to point out the achievements that Vietnam have gotten after 5 years of ratification the TFA Agreement and 13 years of joining in the WTO Organization.
Following that, the thesis mainly focuses on several issues and gains some achievements as follows. At first, the thesis comprehensively analyzes provisions of the WTO Trade Facilitation Agreement (TFA) in WTO and the commitments of Vietnam in implementing the TFA Agreement. Next, the thesis details Vietnam’s legal documents and practical implementation of the TFA Agreement in order to state the compliance and not compliance of those in comparison to the requirements of the TFA Agreement. Each provision on the TFA Agreement is analyzed so as to point out for which the compliance is total, which the compliance is partial and need to adjust.
As a result, the achievements and challenges that Vietnam have met during this process is also pointed out and analyzed in detailed. Finally, based on analysis above, recommendations for Vietnam to fully comply with regulations on the TFA Agreement are revealed. For this part, recommendations for Vietnamese government and ministries are stated in general, recommendations for Vietnam customs are also pointed out in particular. Research rationale After 14 years of participating in the World Trade Organization (WTO), Vietnam has become the 22nd largest export economy in the world.
According to statistics of the General Department of Vietnam Customs (GDVC), in 2019, the total import and export value of the whole country reached US$ 517.26 billion, a year-on- year increase of 7.6 per cent (equivalent to an increase of US$ 36.69 billion) compared to in 2018. Vietnam's exports have increased rapidly with a high growth rate of over 15% in the period of 2011-2019 and officially reached the value of US$ 500 billion in mid-December 2019. This result leads that Vietnam has maintained the trade surplus in four year consecutively, especially this year with a trade surplus of nearly US$ 10 billion. In the context of that domestic economic development has increase significantly and highly integrated with the regional and the world economic, at the same time it has tightly met up the requirements of reform and modernization to facilitate international trade activities, all of those have created great pressure for the Government of Vietnam in general and the Vietnam Customs in particular, including: the volume of imported and exported goods that need to be inspected increases greatly; the time for goods storage to be inspected is shortened in order to meet the requirements; the quick releasing of goods at border gates but still have to ensure the task of combating trade fraud, protecting domestic production and not losing tax revenue.
Trade facilitation opens many priorities for enterprises that strictly abide by customs laws, and more tightening supervision for enterprises showing signs of smuggling and trade frauds. Thus, trade facilitation plays a key role in international trade and trade supply chains, which is also an important issue of the world in general and Vietnam in particular. The new WTO Trade Facilitation Agreement (TFA) is a significant step forward for the international trading regime, representing new hope for the relevance of the WTO. The TFA includes novel measures to help developing countries build capacity, while also taking into consideration regulatory concerns of WTO members 2 through the application of the general GATT exceptions to the new agreement.
If the TFA is properly interpreted, the combination of capacity-building measures and a focus on technological improvements could result in a win-win situation wherein routine positive trade is streamlined, reducing time required to cross borders, while negative trade is more easily controlled and regulated at the border. It is likely that the TFA will reduce the cost of trading across borders, while improving trade for developing countries and allowing WTO members to better control trade flows, through a combination of procedural streamlining and regulatory discretion. For the reasons mentioned above, the topic “Current Situation and Recommendations for the implementation of the WTO Trade Facilitaition Agreement in Vietnam” is chosen to reveal the current implementation of the WTO Trade Facilitation Agreement in Vietnam either in the amendment of Vietnam’s legislation or in the practical implementation. Also, the benefits and difficulties that Vietnam have has to cope with in those processes are pointed out.
Based on that analysis, the objective of this paper is giving some recommendations on Vietnam’s legislation and upcoming strategies to fully implement regulations on the WTO Trade Facilitation Agreement. Literature review Trade facilitation with many benefits for countries in enhancing the effectiveness of international trade, including but not limited to cost cutting, risk and uncertainty reduction, market expansion, has been increasingly received more and more interest from many countries in all over the world, especially in developing countries and least developed countries. As a category to promote international trade, trade facilitation quite received much attention and research from many organizations and researchers, including the research on the TFA Agreement. This part of the thesis will analyze several typical researches on the TFA Agreement in WTO (the TFA WTO).