“Don’t count on any free trade agreement (FTA) with anybody, Vietnam, or anyone. I’m pessimistic on any FTA,” Steven Okun, Senior Advisor, McLarty Associates, said at the “Business Intelligence Briefing: U.S.-Vietnam Policy Outlook,” an online event hosted by AmCham Vietnam, Tuesday.
Any bilateral trade pact will take time, he said. Meanwhile, the U.S.’s ability to enter into trade agreements, including a Vietnam-U.S. FTA, after July 1, 2021 could be nearly impossible unless the Trade Promotion Authority (TPA) is extended.
Laborers work at a garment factory in Thai Binh Province, northern Vietnam, June 13, 2019. Photo by Reuters/Kham.
TPA, also known as “fast track,” allows the president to submit trade agreements to Congress for a straight up-or-down vote without any amendments.
Dr. Le Hong Hiep, a Fellow at Singapore’s ISEAS-Yusof Ishak Institute, expressed a similar opinion. He said that the FTA between the U.S. and Vietnam may not be a priority for the next few years under a Biden administration.
The U.S. is likely to prioritize several domestic issues instead, like containing Covid-19, reducing social conflicts, trying to effect some healing after a series of anti-racism protests as also reconciliation after a deeply divided election, he added.
Nguyen Xuan Thanh, a lecturer at Fulbright University Vietnam, said while there are high hopes for the U.S. rejoining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in some quarters, they are not likely to materialize.
After Biden’s inauguration, the Democrats will need to focus on “essential” matters, he added.
Hiep said trade and investment would be a top priority for both sides in the next four or five years, given that the U.S. remains its top export market and an increasingly important source of investment. Energy and infrastructure are new, very promising areas of cooperation, he added.
Vietnam and the U.S. signed their bilateral trade agreement (BTA) on July 13, 2000, five years after the former foes normalized and established a diplomatic relationship in 1995.
Two-way trade soared from just $450 million in 1994 to $77 billion in 2019, becoming a major component of bilateral relations. Despite the adverse impacts of Covid-19, bilateral trade value rose nearly 10 percent in the first half of this year. The U.S. is now Vietnam’s largest importer and Vietnam remains the U.S.’s fastest-growing market in Southeast Asia.