Hanoi (VNA) - Accordingto the ASEAN Trade in Goods Agreement(ATIGA), Vietnam will have to cut 669 tariff lines to zero percent in January2018.

Among the products are automobiles andspare parts, vegetable oil, refrigerators, air conditioners and dairy products.

ATIGA promises great opportunities forthe country, including exports of many products the country has advantages toother members of the bloc without or very low import tariffs.

Besides, Vietnamese businesses andconsumers will enjoy access to many new goods and have more choices.

As a result, the prices of productswill be more competitive and their quality will be high. 

ATIGAcame into effect in 2010, and thanks to it and other trade agreements ASEAN hasbecome Vietnam’s fourth biggest exporting market behind only the United States,EU and China.

Theagreement aims at eliminating tariffs to foster trade among Southeast Asiannations, supporting joint efforts to handle non-tariff barriers and promotingco-operation regarding customs inside the bloc.

TheMinistry of Finance said the participating countries were committed tofollowing the roadmap:

-Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand largelyeliminated import taxes in 2010.

-Cambodia, Laos, Myanmar and Vietnam eliminated some 90 percent of their tarifflines in 2015, and 97 percent in 2018.

Vietnamalready cut nearly 6,900 tariff lines, or 72 percent of all tariff lines, tozero percent in 2014. It slashed more than 1,700 other lines to zero percent in2015.

In the first 10 months of this year Vietnam’sexports to ASEAN member countries soared 26.8 percent to 18 billion USD.

Imports from ASEAN too shot up by 19 percentin that period to 22.8 billion USD, making Vietnam the third biggest importer ofASEAN goods after the Republic of Korea and China.

The Ministry of Finance believes thatthe rapid increase in the imports from ASEAN will not have too big impact onthe domestic market or on Government’s revenues, public investment and spendingon social security.

However, market observers expect thatnext year when the import tariffs on automobiles go down to zero and importsjump by an expected 30-40 percent, the revenue loss to the Government will bean estimated 4.4 trillion VND a year.

Domestic manufacturers, especially ofautomobiles and spare parts, refrigerators, and air conditioners, and producersof vegetable oils, dairy products, as well as fruits will have to face fiercecompetition from imports.

Vietnamese companies will have nochoice but to make better products at lower prices to win customers.

In Vietnam, many industries such asautomobiles have for decades relied on Government protection and not developedhigh-quality brands yet.

If domestic enterprises, particularlyin the auto sector, do not have proper policies in plans to cope with thechanges they will lose to foreign rivals.

The first thing is for the enterprisesthemselves to realise the need to change to cope with the integration process.

They have to make careful preparations,including reducing production and business costs and costs of marketintegration to bolster the competitiveness of their products and services.

Authorities need to support them byproviding sufficient information about the country’s FTA partners and analysisof the opportunities and challenges the enterprises face in each sector so thatthey clearly understand what they are up against.

Technical barriers based oninternational principles and laws can be erected for authorities to manageimports while helping Vietnamese businesses gradually improve their capacitybefore the complete elimination of tariff barriers.-VNA