US, Vietnam celebrate improvements to trade and investment climate

At an event held in Hanoi, government and business representatives joined to mark the end of USAID’s Trade Facilitation Program and to highlight the joint results achieved since 2018. 

“USAID is a long-time partner of Vietnam’s in improving the country’s trade and the investment environment in Vietnam,” said Aler Grubbs, mission director of USAID/Vietnam.

“The extraordinary results of USAID’s Trade Facilitation Program are a prime example of what our strong partnership can achieve. We look forward to continuing our joint efforts to unlock greater economic growth,” she added.

“The USAID Trade Facilitation Program’s support could not have been better timed, particularly in relation to Vietnam’s implementation of the WTO Trade Facilitation Agreement,” said Nguyen Van Tho, deputy director general of the GDVC. “The Program has supported Vietnam to carry out effective regulatory and administrative reforms through a range of activities, including technical assistance for the application of risk management in customs, capacity building, and the development of effective public-private partnerships,” Tho added.

Through its US$21.7 million Trade Facilitation Program which began in 2018, USAID has partnered with GDVC in a bid to improve the country’s business climate. USAID and GDVC have increased the business community’s voice in terms of the policy-making process; simplified customs procedures; and created action plans aimed at easing port congestion, such as at Cat Lai, the country’s busiest container port, which had been operating at its full capacity prior to COVID-19.

Specific results include supporting the Vietnamese Government on its development of 43 trade-related laws and regulations, 37 of which have been issued; training more than 3,000 government officials and private sector representatives; generating 9,000 national business satisfaction survey responses to strengthen reforms; and putting the nation on track to implement its commitments under the World Trade Organization’s Trade Facilitation Agreement (WTO-TFA) ahead of schedule, thereby supporting the implementation of 20 of the agreement’s 24 provisions.

The country is expected to be in full compliance with the WTO-TFA by the end of 2024.

Both USAID and GDVC worked together to streamline specialised inspections, with this being a procedure that ensures import-export goods meet required safety and quality standards. Previously, specialised inspections in Vietnam involved multiple ministries, thereby resulting in lengthy border clearance times.

According to the GDVC, between 2019 and 2020 the activity has been instrumental in cutting in half the average border clearance time for imports, from 104 hours to 55 hours; reducing by 2.5 times the average border clearance time for exports, from 96 hours to 38 hours; and reducing the costs to traders of completing cross-border procedures by 45% for imports, from US$569 to US$313, and by 20% for exports, from US$420 to US$338.

For over two decades, USAID has supported Vietnamese efforts to institutionalise free, open, and predictable trade. USAID’s long-term support has therefore helped Vietnam improve its World Economic Forum Global Competitiveness Index ranking and move up in the ranking of US export markets. 

This year, the US and Vietnam are celebrating the 10-year anniversary of their Comprehensive Partnership. Both nations’ close co-operation over the past decades in unlocking economic growth serves as yet another example of how both sides work strategically together to create a better future for the two peoples.