TPP an analysis of Chile and lesson for Viet Nam
TPP: Impacts on Chile’s Economy and Lesson Learnt for Viet Nam
I. Introduction
November 2008, Vietnam official joined the negotiation round of the Trans-Pacific Partnership. Since then, there has been a lot of controversy over the costs and benefits of Vietnam in joining one of the biggest trade agreements of the 21st century. The questions being raised include: whether Vietnam’s economy can stand the competitiveness of the totally open trade with major economies, whether TPP bring Vietnam economy any benefits when we has already been member of numerous other trade agreements and organizations… In this research, we do not attempt to answer those questions but rather focus on analyzing the effects of TPP on the economy of Chile and draw out the lessons for Vietnam when considering joining TPP.
Chile was one of the 4 original signatories of the TPP in 2005 together with Singapore, New Zealand and Brunei. The reason we choose Chile for our research is the clearer similarity in economic patterns of Vietnam and Chile in comparison with the other countries. Both Vietnam and Chile rely greatly on exports of mining products and agricultural product processing. Though there are obvious difference in the composition of the economy with Chile inclines more to the service sector and Vietnam more to the agriculture sector; the industry sector plays a big role in both countries’ GDP (36% in Chile’s GDP and 40.8% in Vietnam’s economy). GDP of Chile in 2005, when it first joined TPP was $123,056 million, close to that of Vietnam in 2011 which is $123,600 million1 . Besides that, Vietnam and Chile also share the same major trading partners including the US, China and Japan – 2 of which are negotiating to participate in TPP.
Based on these reasons, we believe that Chile is the country most suitable to be analyzed to get a view of the economic costs and benefits of joining TPP that Vietnam has to consider once entering the negotiation rounds of this integration.
1.
I. Introduction
November 2008, Vietnam official joined the negotiation round of the Trans-Pacific Partnership. Since then, there has been a lot of controversy over the costs and benefits of Vietnam in joining one of the biggest trade agreements of the 21st century. The questions being raised include: whether Vietnam’s economy can stand the competitiveness of the totally open trade with major economies, whether TPP bring Vietnam economy any benefits when we has already been member of numerous other trade agreements and organizations… In this research, we do not attempt to answer those questions but rather focus on analyzing the effects of TPP on the economy of Chile and draw out the lessons for Vietnam when considering joining TPP.
Chile was one of the 4 original signatories of the TPP in 2005 together with Singapore, New Zealand and Brunei. The reason we choose Chile for our research is the clearer similarity in economic patterns of Vietnam and Chile in comparison with the other countries. Both Vietnam and Chile rely greatly on exports of mining products and agricultural product processing. Though there are obvious difference in the composition of the economy with Chile inclines more to the service sector and Vietnam more to the agriculture sector; the industry sector plays a big role in both countries’ GDP (36% in Chile’s GDP and 40.8% in Vietnam’s economy). GDP of Chile in 2005, when it first joined TPP was $123,056 million, close to that of Vietnam in 2011 which is $123,600 million1 . Besides that, Vietnam and Chile also share the same major trading partners including the US, China and Japan – 2 of which are negotiating to participate in TPP.
Based on these reasons, we believe that Chile is the country most suitable to be analyzed to get a view of the economic costs and benefits of joining TPP that Vietnam has to consider once entering the negotiation rounds of this integration.
1.