U.S., Vietnam reach bilateral trade agreement

June 1, 2006  by in UnCategorized   

By Home Furnishings Business in on June 2006 The United States and Vietnam signed a bilateral trade agreement Wednesday that brings Vietnam a step closer to membership in the World Trade Organization.

The market-access agreement was among the requirements for Vietnam’s bid for full WTO membership.

“This is a great agreement for the United States. It opens a vibrant and growing market for American agricultural goods, a range of services, and manufactured products,” said U.S. Deputy Trade Representative Karen Batia. “It also opens the door for Vietnam to join the international rules-based trading system. Through this agreement, Vietnam will become more transparent in its regulatory trade practices, enhance the economic freedoms enjoyed by its people, and establish a more level playing field between Vietnamese and foreign companies.”

Batia added that there is strong bipartisan support in Congress for the approval of Permanent Normal Trade Relations status for Vietnam.

The National Retail Federation welcomed the agreement, saying the pact will make it easier for U.S. retailers to source merchandise from Vietnam and to open stores there.

“On behalf of American retailers, the National Retail Federation is writing to endorse the bilateral market access agreement signed today between the United States and Vietnam, and to offer the full support of the U.S. retail industry as the process of Vietnam’s accession to the World Trade Organization moves forward to congressional consideration of Permanent Normal Trade Relations status for Vietnam,” NRF President and CEO Tracy Mullin said in a letter to Deputy U.S. Trade Representative Susan Schwab, President Bush’s nominee to replace U.S. Trade Representative Rob Portman.

Mullin said NRF was pleased by a number of provisions of the agreement, including language that will allow U.S. retailers to open and wholly own stores and other retail operations serving customers in Vietnam. Vietnam has also agreed to lower duties and eliminate many restrictions on the importation of most manufactured and agricultural products, including those sold at retail.

Under another provision that will greatly benefit apparel retailers, the United States will eliminate all existing textile and apparel quotas on Vietnam as soon as Vietnam’s membership in the WTO becomes official, and will not employ any special textile safeguard mechanism. In return, Vietnam has agreed to immediately eliminate all subsidies to its textile and apparel industries prohibited by the WTO, and agreed to be subject to an enforcement mechanism to ensure that it abides by this commitment.

“We are persuaded that this enforcement mechanism provides an effective and appropriate means to identify and address any remaining WTO-prohibited subsidies without imposing quotas,” Mullin said.

The agreement was signed Wednesday in Ho Chi Minh City by Bhatia and Vietnamese Deputy Minister of Trade Luong Van Tu.