Vietnam accedes to the World Trade Organisation

Vietnam has finally been admitted to the World Trade Organisation, bringing its total membership to 150. The General Council of the WTO approved Vietnam’s membership on 7 November 2006, and it acceded 30 days after the agreement was ratified. The decision ends over 11 years of preparation, including eight years of negotiation.

“Vietnam has shown how anchoring domestic reforms in the WTO can yield dramatic results. Vietnam’s economic growth topped 8% last year, foreign direct investment rose steeply to over USD6 billion, and exports surged by over 20%. More must surely follow with the new laws, administrative measures, and commitments on goods and services that are in Vietnam’s membership package,” WTO Director-General Pascal Lamy said at the time of the membership approval. According to the latest WTO data, Vietnam’s merchandise exports were USD26.5 billion in 2004, and its imports were USD32.0 billion.

Many companies have not waited for the accession to commence their investment in the market. Vietnam is seen by many manufacturers as a low cost alternative to China, where prices in some areas have risen substantially. To take advantage of the increased level of trade expected, investment has poured into a variety of infrastructure projects as well as a surge in the number of joint ventures being established by logistics, freight forwarding, shipping and port companies.

In 2006 both DHL and FedEx made agreements with the Vietnamese Post and Telecommunications Group and the Ministry of Planning and Investment to establish alliances. Also last year NYK Lines committed to sinking USD200 million into a number of shipping and logistics projects. These will include port and shipbuilding initiatives. TNT is extending its Asia road network to Vietnam, scheduled for the first half of this year, and in the last few months APL, MOL, Aramex, Kintetsu, DHL have all announced initiatives.