Lawyer in Vietnam Oliver Massmann presenting to the Members of the National Assembly of Vietnam on the Trans-Pacific Partnership Agreement

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OLIVER MASSMANN - Partner, General Director
DUANE MORRIS VIETNAM LLC
Presentation to the members of the National
Assembly of Vietnam - Implementation and Impact
of the Trans-Pacific Partnership Agreement

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Introduction
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• I have been living in Vietnam for over
20 years.
• I am married to a Vietnamese and have
2 children
• It is my great honour to present in front
of the members of the National Assembly
and distinguished guests on the important
topic of the Trans-Pacific Partnership
Agreement.
• I choose Vietnamese to speak as I
love the language and the people here.
Oliver Massmann
General Director of Duane
Morris Vietnam LLC

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AGENDA:
• OVERVIEW ON THE TPP
• HOW IS THE TPP DIFFERENT?
• HOW WILL TPP IMPACT VIETNAM?
• IMPLEMENTATION OF THE TPP
• CONCLUSION
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How is the TPP Different?
• GDP of 12 TPP Members is nearly $28 trillion, 40% of global GDP and
one-third of world trade.
• The TPP is being touted as a “high-standard agreement” meaning “a
landmark, 21st-century trade agreement, setting a new standard for
global trade and incorporating next-generation issues”.
• So-called "key elements" including the notion of comprehensive
market access, a fully regional agreement, cross-cutting issues
(market for all goods (including agriculture), services, regulatory
coherence, competiveness and business facilitation, small and medium
sized enterprises), new trade challenges (environment, labour and
particularly rules on state owned enterprises); as well as, the notion of a
living agreement.
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How will TPP impact Vietnam?
• Vietnam as the second smallest economy among
TPP members after Brunei will be the major
beneficiary if it fully implements the TPP.
• According to the World Economic Forum,
Vietnam will have the biggest percentage change
in GDP in 2025 (28.2%)
• Vietnam’s income will increase by 10.5%
(according to Peterson Institute for International
Economics)
• Vietnam will become a major manufacturing
hub in the region due to continued strong
growth of traditional manufacturing sectors
(textile & apparel) and rapid expansion of higher
value sectors such as computers, electronics and
electrical equipment led by Samsung and Intel.6

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Implementation of the TPP –
Opportunities and Challenges
• Tariff elimination instead of tariff reduction in most tariff
lines is a driving factor for Vietnam’s exports when accessing
other TPP countries’ markets, especially big trading partners
being the U.S and Japan.
• Challenges:
– How to qualify for the duty-free status? (regional value content
for example)
– Strict Technical Barriers to Trade, Sanitary and Phytosanitary
requirements
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• Cheaper goods but with higher quality, variable materials for
domestic production.
• Challenges:
– More competition
– In certain sectors, for example, pharma or
agriculture, high IP protection will result in
expensive products. People will have more
difficulty in purchasing high quality
medicines or Vietnam’s agricultural products will be less competitive.
– In agricultural sector (mostly affected by the TPP), agricultural sustainability and socio-
economic development of these areas can only be improved by collaboration among 4
players - State agencies, scientists, farmers and buyers. The Government should expand
the implementation of this model into many other provinces besides Thanh Hoa and
South East regions of Vietnam.
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Implementation of the TPP –
Opportunities and Challenges

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Implementation of the TPP –
Opportunities and Challenges
• State-owned enterprises (SOEs): During TPP negotiations,
SOE sectors were discussed from the very first rounds when
they negotiate rules of constructing and implementing
competition policies.
• The Chapter on State-owned Enterprises and Designated
Monopolies puts a huge pressure on SOEs performance. As
such, Vietnamese Government will have to accelerate the
equitization of SOEs, to reduce the State control in SOEs
and to push SOEs to operate in line with market principles.
• Government will need to focus its efforts to assist SOEs to
adapt to non-preferential treatment or access to Government
spending, or special access to land and investment capital.
• The equitization of SOEs should focus on change in
ownership structure of SOEs after equitization, not only
relating to the number of SOEs participating in the reform
as the current model reveals.9

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Implementation of the TPP –
Opportunities and Challenges
• Sustainable development is repeatedly mentioned in the TPP:
“The Parties also acknowledge that effective domestic coordination of trade, investment and
development policies can contribute to sustainable economic growth.”
“The Parties recognise the potential for joint development activities between the Parties to reinforce
efforts to achieve sustainable development goals.”
(Chapter 23 of the TPP)
• However, there is no standard and test for sustainable development in
Vietnam. The Government should adopt sustainability test in accordance
with the TPP.
• Investment in renewable energy is also needed for sustainable
development. The Government must make sure that EVN is moving on
getting Renewable energy PPAs concluded with foreign investors
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Implementation of the TPP
• Proper and timely implementation of the TPP is
the key.
• It will then increase Vietnam’s competitiveness
with other countries in the region.
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Implementation of the TPP
• If Vietnam implements the TPP properly and in time, it
will achieve a higher level of legal certainty in certain
commercial sectors than in highly industrialized countries
like Germany as Germany does not adopt Investor-State
Dispute Settlement principles as Vietnam does in the
TPP.
• The TPP will then create a huge influx of foreign direct
investment
• Vietnam will be one of the Leading countries in South
East Asia for decades to come.
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Recommendations – For enterprises
Understanding
Rules
Assessing
impacts
Developing
strategies
Improving
competitiveness
Contributing to
policy-making
process
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Recommendations – For the Government
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Regulatory
reform
Change in the
mindset:
From “control,
manage” to
“support, service”
development of
private sector
Reform to SOEs

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DUANE MORRIS VIETNAM LLC
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Contact email:
omassmann@duanemorris.com
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