The report «Deepening International Integration and Implementing the EVFTA», released today, estimates that by simply benefiting from the agreed tariff reduction, EVFTA could increase Vietnam`s GDP and exports by 2.4% and 12% by 2030 and free an additional 100,000 to 800,000 people from poverty by 2030. Such benefits are particularly urgent to generate positive economic benefits as the country responds to the COVID-19 pandemic. To study the impact of tariff reduction on the economy, various studies have recently used the CGE model, which is very effective in studying the economic impact of climate change, tax policy or tax reform. There are papers using the CGE static model (Dasgupta and Mukhopadhyay, 2017; Ganguly and Das, 2017; Jean et al., 2014; Khorana and Narayanan, 2017; Shaikh, 2009; Todsadee et al., 2012; In the meantime, others have used a dynamic CGE model to measure the impact of free trade agreements (Itakura and Lee, 2012; Do and Lee, 2015). Vietnam Chamber of Commercial and Industry (2016), «Summarize about Europe-Vietnam free trade agreement,» available at: www.trungtamwto.vn/chuyen-de/vefta (accessed January 15, 2018). Nguyen, D.K.L. and Cao, T.H.V. (2016), «Do free trade agreements generally and individual raise foreign direct investment into Vietnam?», Foreign Trade University, IL, available at: veam.org/wp-content/uploads/2016/08/64.-Cao-Thi-Hong-Vinh.pdf (accessed March 15, 2018). On the basis of the above results, it is definitively established that the trade balance in Vietnam will be in deficit due to zero industrial tariffs. More and more industrial products from EU countries will invade the Vietnamese market, which represents a multitude of fierce competition for domestic companies, but will create great opportunities for Vietnamese companies to improve the business environment, improve product quality and diversify product types.
The implementation of the agreement «cannot come at a better time for Vietnam if it is on the road to economic recovery after several months of shutdown due to COVID-19,» economist Pham Chi Lan, a former adviser to several Vietnamese prime ministers, told The Associated Press. As Vietnam`s second largest trading partner among all ASEAN countries, NAFTA is a welcome development for both sides. This comprehensive and ambitious agreement aims to modernise and simplify the customs, regulatory and formalities necessary for trade. NAFTA`s intellectual property («IP») provisions will lead to significant positive changes to Vietnam`s IP legislation and create new economic opportunities in the country. Minh, P.N., Nhieu, N.T., Van Anh, H.T. and Linh, N.K. (2018), «Impacts of new generation of free trade agreements (FTAs) on the development of export-import markets of members – Vietnam case study», Вьетнамские сиследованя, Vol. 3 no 3, pp.
18-31. Ahmed and O`Donoghue (2010) used data from Pakistan`s Social Accounting Matrix for 2002 and developed a CGE model to assess the impact of a reduction in tariff rates on Pakistan`s macroeconomic and welfare indicators. They concluded that tariff reductions not only increased social levels, but also increased export value, household consumption and gross fixed capital formation. Similarly, Khorana and Narayanan (2017), Shaikh (2009) and Winchester (2009) used a CGE model to successively assess the impact of tariff reductions on the economies of India, Pakistan and New Zealand. . . .