Vietnam has established numerous strategic partnerships economically. The basic fundamentals of a market economy are gradually being formed and many countries admit. Up to date, nearly 50 countries have recognized Vietnam's economy as market economy (they are also big trade partners of Vietnam), while Vietnam has established diplomatic relations and trade with more than 170 countries.
Over 90 bilateral trade agreements, 60 investment agreements, 54 agreements against double taxation were signed. In 2016, Viet Nam will integrate comprehensively and intensively into the global economy. The integration process will bring back both opportunities and challenges. Vietnam has also established multilateral partnerships and more active area with many international financial institutions such as Asian Development Bank (ADB), the International Monetary Fund (IMF) and World Bank (WB)
In 2015, Viet Nam set a global record in the number of FTAs. The FTA between Viet Nam and the member countries of the Economic Alliance Asia – Europe (EEU) - Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan, reached on May 29 is expected to benefit from of the market opening in goods that account for about 90% of tariff lines, equivalent to over 90% of bilateral trade. Once the FTA takes effect, two-way trade turnover would hit US$10-12 billion by 2020 and rise three times against 2014. Another success in 2015 is the EV-FTA, under which, Viet Nam and the EU would cut over 99% of tariff lines, the highest commitments ever made by Viet Nam. The benefits of the EV-FTA for Viet Nam is equal to TPP’s ones.TPP would boost US$ 23.5 billion of Viet Nam’s GDP by 2020 and US$ 35.5 billion by 2025. The ASEAN Economic Community (AEC) came into effect on January 1, 2016, and created the world’s seventh-largest single market of 600 million people, larger than the European Union or the North American Free Trade Agreement.
The international economic integration has a positive impact on the economic development of Vietnam. The export market of Vietnam is extended to 230 countries and territories. The business environment is increasingly improved, facilitating enterprises participation in global value chains.
Currently, Vietnam has deeply participated in three global value chains, which have increasingly important role for the global economy, including the food value chain (and food security); the energy value chain(and energy security) and the value chain of textiles and footwear. Some products of Vietnam have now stable position in international market.
Along with big gains in market expansion, investment attraction and technology access, the economic integration since the Doi moi has brought also big challenges, including the fluctuations in both international and domestic market. Supply-demand relation in the domestic market is affected strongly by the global market while the price of input products increasingly influence on domestic production.
Economic integration has created also the hard competition between import products and domestic ones and between Vietnamese products and which of other exporters in the international market. In some case, export products faced with the unfair competition due to technical barriers and trade countermeasures of importing countries. Trade conflict, especially anti-dumping cases is among major concerns of Vietnam in the economic integration. In recent years, the penetration of foreign investors in many industries of Vietnam has pushed up the trend in M&A of big companies in Vietnam, which hold now big market share in the domestic market.
