IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/332662.html
   My bibliography  Save this paper

Trade Liberalisation and Rural Poverty in Vietnam

Author

Listed:
  • Vanzetti, David
  • Pham, Huong Thi Lan

Abstract

Abstract Vietnam is about to sign a path-breaking free trade agreement with the European Union. When fully implemented, this will lead to a significant increase in exports from Vietnam to the European Union. The major sectors to benefit include textiles, apparel, footwear and fish. However, tariff reductions will expose Vietnam’s less competitive agricultural sectors, such as beef, dairy, pork and sugar. This has implications for rural poverty, given that many poor people reside in rural areas. The likely effects are quantified using GTAP, a well-known general equilibrium model. The standard model is modified to account for an expanding economy since the base year (2007) and for expected growth to 2025, the period in which tariff reform is expected to be completed. To project the baseline to 2025, we first use forecasts of capital, labour, land and natural resources to 2025. Next, we use the model to find productivity growth that will generate each year’s GDP target, given the growth in factors of production. We then feed the resulting productivity changes back into the model and solve as normal to reproduce the target growth in output. The baseline takes account of known reductions in tariffs from FTAs negotiated but not fully implemented. This includes Vietnam’s FTAs with ASEAN (AFTA), China (ACFTA), Korea (AKFTA), Japan (AJCEP), India (AIFTA), and Australia and New Zealand (AANZFTA). However, it does not include agreements which have not been negotiated, such as the TPP. The EU-VNM free trade agreement is still under negotiation, but the expected tariff cuts and exemptions can be estimated by looking at the EU agreements with Korea, the Caribbean and several Latin American countries, and the Vietnamese agreement with Japan, Korea and China. These agreements specify a sensitive list, a highly sensitive list and an exclusion list, and this gives an indication of the sectors that Vietnam would like to protect and is perhaps prepared to phase out protection ov...

Suggested Citation

  • Vanzetti, David & Pham, Huong Thi Lan, 2015. "Trade Liberalisation and Rural Poverty in Vietnam," Conference papers 332662, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332662
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/332662/files/7341.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Burfisher,Mary E., 2011. "Introduction to Computable General Equilibrium Models," Cambridge Books, Cambridge University Press, number 9780521766968, December.
    2. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    3. Burfisher,Mary E., 2011. "Introduction to Computable General Equilibrium Models," Cambridge Books, Cambridge University Press, number 9780521139779, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Leone Walters & Heinrich R. Bohlmann & Matthew W. Clance, 2016. "The Impact of the COMESA-EAC-SADC Tripartite Free Trade Agreement on the South African Economy," Working Papers 201669, University of Pretoria, Department of Economics.
    2. Chiedza L. Muchopa, 2021. "Economic Impact of Tariff Rate Quotas and Underfilling: The Case of Canned Fruit Exports from South Africa to the EU," Economies, MDPI, vol. 9(4), pages 1-17, October.
    3. Adam Rose & Zhenhua Chen & Dan Wei, 2023. "The economic impacts of Russia–Ukraine War export disruptions of grain commodities," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 645-665, June.
    4. Muhammad Shahzad Iqbal, Sofia Anwar, Kakali Mukhopadhay, Muhammad Aamir Khan, 2017. "GSP Plus Status and Income Distribution: A CGE Model for Pakistan," Journal of Management Sciences, Geist Science, Iqra University, Faculty of Business Administration, vol. 4(1), pages 27-53, March.
    5. durongkaveroj, wannaphong, 2015. "The Next Chapter of ASEAN Economic Community through Integrating with the existing FTA partners (RCEP), Turkey, and Pakistan," MPRA Paper 63421, University Library of Munich, Germany.
    6. Marco Rogna, 2020. "Microeconomic models of a production economy with environmental externalities," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(3), pages 2625-2650, March.
    7. Khaerul Azis, Mohammad & Widodo, Tri, 2019. "The Impact of Carbon Tax on GDP and Environment," MPRA Paper 91314, University Library of Munich, Germany.
    8. Tewodros Negash Kahsay & Onno Kuik & Roy Brouwer & Pieter Van Der Zaag, 2017. "The Economy-Wide Impacts Of Climate Change And Irrigation Development In The Nile Basin: A Computable General Equilibrium Approach," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 8(01), pages 1-30, February.
    9. Monique Carvalho & André Azevedo & Angélica Massuquetti, 2019. "Emerging Countries and the Effects of the Trade War between US and China," Economies, MDPI, vol. 7(2), pages 1-21, May.
    10. Afonso, Damares Lopes & Bastos, Suzana Quinet de Andrade & Perobelli, Fernando Salgueiro, 2021. "Latin America and China: mutual benefit or dependency?," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    11. Pinto, Talita & Zanetti De Lima, Cicero & Gurgel, Angelo & Teixeira, Erly, 2016. "Spillover effects of rural credit: a CGE application for Brazilian regions," Conference papers 332761, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    12. Andrista, Safira & Widodo, Tri, 2017. "Welfare Impact of ASEAN Economic Integration: “ASEAN Way” Versus Theory," MPRA Paper 80880, University Library of Munich, Germany.
    13. Alim Rosyadi, Saiful & Widodo, Tri, 2017. "Impacts of Donald Trump’s Tariff Increase against China on Global Economy: Global Trade Analysis Project (GTAP) Model," MPRA Paper 79493, University Library of Munich, Germany.
    14. Habtamu Shiferaw Amogne & Taiji Hagiwara, 2021. "Impact of alternative regional trade arrangements on the Ethiopian economy," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 10(1), pages 1-26, December.
    15. M. Alejandro Cardenete & M. Carmen Lima & Ferran Sancho, 2013. "Are There Key Sectors? An Appraisal Using Applied General Equilibrium," The Review of Regional Studies, Southern Regional Science Association, vol. 43(2,3), pages 111-129, Winter.
    16. Cai, Yiyong & Newth, David & Finnigan, John & Gunasekera, Don, 2015. "A hybrid energy-economy model for global integrated assessment of climate change, carbon mitigation and energy transformation," Applied Energy, Elsevier, vol. 148(C), pages 381-395.
    17. Fiorini, Matteo; Lebrand, Mathilde, 2016. "The Political Economy of Services Trade Agreements," Economics Working Papers ECO2016/05, European University Institute.
    18. Wang, X. & Dietrich, J.P. & Lotze-Campen, H. & Biewald, A. & Munson, T.S. & Muller, C., 2018. "Trading More Food in the Context of High-end Climate Change: Implications for Land Displacement through Agricultural Trade," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 276997, International Association of Agricultural Economists.
    19. Mario A. Fernandez & Adam J. Daigneault, 2018. "Money Does Grow On Trees: Impacts Of The Paris Agreement On The New Zealand Economy," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 9(03), pages 1-23, August.
    20. Oscar Bajo-Rubio & Antonio G. Gómez-Plana, 2015. "Alternative strategies to reduce public deficits: Taxes vs. spending," Journal of Applied Economics, Universidad del CEMA, vol. 18, pages 45-70, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:pugtwp:332662. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.