Zhejiang'S Exports Will Be Negatively Affected By The FTA.

The Vietnam free trade agreement was officially launched in June 26, 2012, and the EU free trade agreement will take effect from the date of signing. Vietnam's exports to the EU, about 65% of its commodities, do not have to pay taxes on that day. The agreement is superior to the free trade agreement (FTA) signed by the European Union and the developing countries through 14 formal negotiations and several rounds of medium term negotiations.

The two sides will eliminate more than 99% of the tax revenue according to the road map. For the remaining part of the tax revenue, they will be regarded as a mutual tariff quota or partial tariff reduction. This can be regarded as the highest level of Vietnam's commitment in the field of free trade agreement.

The EU is Vietnam's second largest trading partner and the largest export market, with bilateral trade volume reaching US $36 billion 800 million in 2014, and Vietnam's exports to the EU account for about 1/5 of its total exports.

The EU is also the largest export market of our province, with bilateral trade totaled 72 billion 300 million US dollars in 2014, and our province's exports to the EU account for 22.9% of total exports.

With the signing of the EU Vietnam FTA, the impact on our exports to Europe can not be ignored.

First, Vietnam's export product structure to Europe is similar to that of our province's export products.

The structure of Vietnam's export products is very similar to that of our province's export products.

Vietnam's main exports to the EU are footwear, textile and clothing, electronic products, computers and parts, furniture, agricultural and sideline products, etc., which occupy a significant proportion of Vietnam's exports to the EU.

By contrast, five categories of textiles, clothing, electronics, furniture, footwear and agricultural and sideline products account for half of our total exports to the EU (50.4% in the first half of 2015).

Two, the implementation of FTA will greatly enhance the competitiveness of Vietnamese products.

At present, only 40% of Vietnam's exports to the EU enjoy zero tariff or preferential tariff rate. Among them, the EU's tariff rate on imports of footwear from Vietnam is 3.5-4%, and the tariff rate of textile duty is 9.6%.

After the formal implementation of the FTA, the relevant products will enjoy a zero tariff rate, and the reduction of the tax rate will greatly enhance the competitiveness of these products in the EU market.

Three, Vietnamese products will have a certain substitution effect on our products.

Because

The similarity of structure and the improvement of Vietnam's product competitiveness will have a certain degree of substitution effect on our province's exports to the EU.

The monitoring data of the Zhejiang provincial foreign trade operation monitoring system of the Provincial Department of Commerce showed that at present, our province faces 15.1% of the customer orders pfer, and the special textile and garment export enterprises have accelerated the trend of order pfer in recent years, mainly to Southeast Asia.

After the formal implementation of the agreement is expected, the proportion of our province's pfer to Vietnam and other Southeast Asian countries will increase.

In the first half of 2015, the proportion of our province's exports to the EU's exports accounted for 0.8 percentage points lower than the end of 2014.

In recent years, the prominent features of the import and export structure between Vietnam and the EU are enormous complementarity, seldom with direct competition, while our province's exports to the EU are faced with many unfavorable factors of trade friction.

With the formal signing of the EU Vietnam FTA, more than 50% of our province's competitive advantage will be relatively weakened. The growth of our province's future export to the EU will face greater pressure, resulting in the negative impact on exports to Europe, which deserves continuous attention.

The free trade negotiations between the United States and Vietnam are part of the negotiations on the p Pacific Partnership Agreement (TPP). Although there are some differences between the two sides, especially the United States and Vietnam's views on state owned enterprises, environmental protection and labor standards are not synchronous, they have been almost completed after a long period of rounds of negotiations.

According to the news, the US Vietnam FTA will be implemented by the end of 2017.

In recent years, the economic and trade relations between the United States and Vietnam have been developing rapidly. Over the past three years, the bilateral trade volume has increased by more than 20% annually.

In 2014, bilateral trade amounted to US $35 billion, of which Vietnam exported $29 billion 400 million to the US.

Similar to the product structure exported to the EU, textile clothing and footwear are also the main exports to the United States. In 2014, Vietnam's exports to the United States, textile, clothing and footwear were $13 billion 100 million, second only to China's exports to the United States.

Although in the current negotiations, the United States adheres to the principle of "starting from yarn", that is, starting from upstream spinning, it must be produced in the TPP area, requiring Vietnam to substantially reduce the import of textile materials outside the region (currently Vietnam needs to import textile raw materials worth about $4 billion 700 million annually from China), and Vietnam can not get the complete tariff exemption from TPP in the United States.

But once the US Vietnam FTA comes into effect, Vietnam's tariff rate on exports to the United States will drop sharply.

Vietnam's textiles will be far lower than the average tariff rate of 14% of our exports to the United States. Vietnam's competitive advantage will be greatly improved, and will have a huge impact on the export of major textiles such as our province.

One is to avoid traditional price competition through industrial upgrading.

The structure is determined by the structure of the manufacturing industry, and the export structure is a direct reflection of the industrial structure.

Compared with the whole country, the proportion of labor-intensive products exported to our province is relatively high, accounting for 40.6%, far higher than 22.4% of the whole country and 20.1% of Guangdong.

Judging from the trend, the structural adjustment of our province's export products has been relatively slow. In 2008 -2014, the proportion of labor intensive products exports increased by 2.1 percentage points, while the proportion of electromechanical products exports decreased by 2.9 percentage points.

In the past, labor-intensive products mainly rely on the advantages of low labor costs. With the rising cost of elements and the weakening of traditional industries' competitive advantage, the export of goods exported by our province has already met the "ceiling".

In the first half of the year, the negative growth of our textile and clothing exports is the cumulative reaction of the gradual loss of traditional competitive advantages.

In the year when the international market demand is relatively prosperous, strong market development will bring about the rapid growth of exports, which will often mask the slow adjustment of industrial structure.

At present, the international market demand is not strong and the traditional competitive advantage is weakening. This is the "new normal" that Zhejiang exports encounter. The existing industrial structure, product structure and strong market development can only maintain the scale of exports, and it is difficult to achieve greater growth.

Therefore, it is urgent to build up the quality, grade and added value of Vietnamese products through the upgrading of industries in the province, so as to avoid the traditional price competition with Vietnam, so as to solve the adverse effects brought about by the implementation of bilateral agreements.

Two, we should actively encourage enterprises to "go out".

On the one hand, we should encourage our province's advantageous industries and surplus capacity to pfer in an orderly way, set up production and processing bases, make use of the policy advantages of the host country, avoid trade barriers, and diversify the export origin.

At present, many textile production enterprises have established production bases in Southeast Asia, such as Vietnam and Kampuchea, such as Jian Sheng group, which has established production bases in Vietnam coastal defense.

On the other hand, we support the construction of overseas economic and trade cooperation parks and promote industrial agglomeration investment, such as our province has set up Vietnam Longjiang Industrial Park in Vietnam.