Tác động của các hiệp định thương mại đến xuất khẩu gạo của việt nam tt tiếng anh

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INTRODUCTION
1. The reason of selecting the thesis topic
With the situation of rice in world food structure, rice production and export
have significance for ensuring rice supply - demand stability in all conditions. They
contribute to the task of global food security, and give turnover to the nations.
However, in the context of deep and wide international economic integration,
which main manifestations are bilateral, regional and multilateral trade relations.
Trade agreements are legal basis making rice export meet the specific content of
origin, characteristics, quality, safe and sanitary products and environment etc.
Additionally, Vietnam’s rice to export are a symbol of gradually “lower-grade” than
other agricultural exports; actuality of climate change requires farmers have
restructured agriculture by reducing transplantation rice; the “fastidious” markets such
as Japan, United State, Europe ect are tending to “denigrate” Vietnam’s rice but they
are enthusiatic to buy Vietnamese fruit and vegetables at good price.
However, world rice demand has always been increasing, food security is still
urgent issue for many countries in the world. Vietnam’s rice to export is in context of
countinuous fluctuation of domestic and foreign factors, in which trade agreements
like “catalyst” requires rice sector to carefully consider in the orientation of rice export
is suitable to international practices in the following time. Based on these comments
and in accord with specialistic economic history, PhD has worked on the thesis as
toptic “Impacts of Trade Agreements on Vietnam’s rice export”
2. Research objectives of the thesis
2.1. General objectives
The thesis proposes new comprehention of Vietname’s rice export to adapt to
impacts of trade agreements and threats in new international economic integration that
are still relevant to inherent role of rice sector.
2.2. Specific objectives
The first, to systematise some theoretical issues on impacts of trade agreements
on rice export; summarize the experience of rice export of several countries under
impacts of trade agreements, thence drawing lessons for Vietnam.

The second, overview of some trade agreements impacting on Vietnam’s rice export.
The third, analysis of the real situation of Vietnam’s rice export under impacts of
trade agreements that Vietnam is a member.
The forth, to propose solutions and petitions to promote rice export in the
direction of good adaptation to impacts of trade agreements
3. Subjects and scope of the study
* Research subjects
- The contents of the trade agreements that Vietnam participates with relating
to rice export; the reality of Vietnam's rice export to member and non-members
countries with Vietnam in trade agreements; impacts of trade agreements that Vietnam
has participated on Vietnam's rice export.

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* Research scope
Scope of content: The thesis examines the content and impacts of trade
agreements affecting on Vietnam's rice export, including: AFTA; 3 Bilateral trade
agreements; 5 Mixed Trade Agreements; and trade agreements have not yet validated,
the trade agreement negotiated without contract and the agreements are under
negotiation.
* Study area: The thesis focuses on the Vietnam’s rice export market with a
large proportion.
* Time range:
- The thesis generalizes the development of the rice sector (production and
export) from the 80s of the 20th century until 2017, assesses the status of impacts of
trade agreements on Vietnam's rice export with the timelines of trade agreements in
validity from 2000 to 2015 (the period since the entry into force of the Vietnam-US
Bilateral Trade Agreement, opening the period of continuous Vietnamese accession
entering into regional and world agreements). It has assessed the potential impact of
trade agreements that are not valid or in negotiation between 2000 and 2016, updated
information on rice export of the world in 2016 - 2017.

- Solutions of the thesis on Vietnam's rice export under impacts of trade
agreements towards 2030.
4. Approach and Methodology
4.1. Approach
Approach in the perspective of economic history and from the theory to the
reality, considering changes to export rice under the impact of the trade agreements
that Vietnam has signed in the temporal order.
4.2. Methodology
- Qualitative research Methodology: combining historical methods, logical
methods, analytical methods based on statistical results, collating and comparing data
and economic phenomena in rice export to clarify the change in rice export, both
quantity and quality from time to time of the roadmap for the implementation of trade
agreements.
- Experimental research Methodology: Applying the structural gravity model in
international trade to study the events that occurred after the implementation of the
trade agreement (post-period analysis).
5. New contributions and limitations of the thesis
5.1. New contributions of the thesis
* The thesis has theoretical contributions:
- The thesis comprehensively analyzes the impact of bilateral, regional and mixed
trade agreements on Vietnam’s rice export.
- The thesis deals with impacts of trade agreements on rice export in order to
concretize each factor but not only economic or welfare aspects.


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* The thesis has practical significance.:
- The thesis studied the topical issue because rice has been the main export
products of Vietnam for a long time. However, when Vietnam participates in trade
agreements, rice export has been associated with many opportunities and new threats.

Hence, the rice needs to consistent with the trend of integration and the content of trade
agreements.
- The thesis examines impacts of trade agreements for identifying suggestion
to motivate rice export towards sustainable development, thus motivating the
development of rural agriculture.
* The thesis contributes research methodology to analyze impacts of trade
agreements on rice export in Vietnam through the combination of qualitative analysis
and quantitative models (structural gravity model)
5.2. The limitations of the thesis
Some factors that impact on rice export such as climate change, scale and price of
rice export of competitors, unexpected and difficult to anticipate factors have not been
put into the experimental model. However, the thesis uses qualitative analysis of these
factors not yet inserted in the model to make more comprehensive contributions.
6. Structure of the thesis
Chapter 1: Overview of research on impacts of trade agreements on Vietnam’s
rice export;
Chapter 2: Theoretical fundament and international experience on adaptation
to impacts of trade agreements on rice export;
Chapter 3: Analyzing the current situation of impacts of trade agreements on
Vietnam’s rice export;
Chapter 4: Some solutions to enhance the adaptability of Vietnam’s rice
export to impacts of the trade agreements by 2030.
CHAPTER 1: OVERVIEW OF RESEARCH ON IMPACTS OF TRADE
AGREEMENTS ON VIETNAM’S RICE EXPORT
1.1. Research on impacts of trade agreements on rice export in the process
of international economic integration
1.1.1. Research on the benefits of exports and factors affecting exports
Trade Theories in research by Do Duc Binh and Ngo Thi Tuyet Mai (2013) has
indicated the mechanism and the reason that trade generates benefits for nations.
Research on factors influencing supply (production capacity), export demand

(purchasing power) and factors that attract / hinder exports: Carrere (2006), Inmaculada
and Felicitas (2003) , Sandberg (2004), Do Tri Thai (2006), Tu Thuy Anh and Dao
Nguyen Thang (2008), Dao Ngoc Tien (2009), Bikker (2009), in which trade agreements
are one of the influencing factors to export, not only directly but also indirectly through
policies towards export.

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1.1.2. Research on impacts of trade agreements on export
1.1.2.1. Overview of theoretical research on impacts of trade agreements on
countries in the world
- Static impacts include "trade creation" and "trade diversion" (Viner, 1950;
Krugman, 1993; Bhagwati and Panagariya, 1996; Krueger, 1999; Fukao et al., 2002)- Dynamic impacts have long-term effects on welfare, economic restructuring,
industry structural change ... (Hertel et al., 2001; Itakura and Lee, 2012; Lee and
Itakura , 2014; Cheong, 2013)
1.1.2.2. Overview of experimental method in research on impacts of trade agreements
- Research use of gravity model: Tinbergen (1962), Anderson and Wincoop
(2003), Magee (2008), Hapsari and Mangunsong (2006), Ruzita et al. (2009); Yin
(2010), Do Ba Khai (2014), Okabe (2015), Vu Thanh Huong (2016), ... consistent
with post-period assessment (the impacts have occurred)
- Research use the global computable general equilibrium (CGE) model:
Todsadee et al. (2012), Petri et al. (2012), Petri and Plummer (2016), Lee and Itakura
(2015), Cassing et al. ), Nguyen Duc Thanh et al. (2015).
- Research use the patial equilibrium: Cassing và cộng sự (2010), Fukao và
cộng sự (2002), Datta và Kouliavtsev (2005), Burfisher và cộng sự (2014), Nguyễn
Đức Thành và cộng sự (2015).
1.1.3. Research on rice export and impacts of trade agreements on rice export
- For rice export, research on overseas rice export: Boriss (2006), Poramacom (2014),
Ramakrishna and Degaonkar (2016), Memon (2017), Adhikari et al. (2016); research on rice
export in Vietnam: Nguyen Trung Van (1998), Nguyen Dinh Long (1999), Dinh Thien
Duc (2003), Le Minh Nghia (2004), Ho Cao Viet (2010), Dinh Van Thanh, Dinh Vu Van

Hung (2013), Le Xuan Tao (2015).
- For impacts of trade agreements on rice export, mostly qualitative research on
impacts of trade agreements on the export of goods in general and agricultural
products in particular, including rice as an example (Cassing et al., 2010; Dinh Van
Thanh, 2010; Pham Thai Quoc, 2013; Tran Phu Phuong, 2013; Bui Thanh Nam, 2016;
www.trungtamwto.vn/fta) or research on rice export which refers to trade agreements
as a note in the development of the industry (Dawe, 2010; Anon., 2015; Broadbent et
al. 2015; Anon., 2016; Ramakrishna and Degaonkar, 2016).
1.2. Research space
Firstly, most research only focus on one or more specific agreements. Few
research assessed aggregately the impact of bilateral, regional and multilateral trade
agreements to export of Vietnam.
Secondly, research assessed mainly impacts of trade agreements on countries,
including Vietnam, on the economic, welfare and national trade flows. Few research
assessed the impact of a trade agreement on a specific industry.
Thirdly, published research is lack of aggregate assessment as well as the
update on new fluctuations in rice export (rice supply, rice demand in the international
market, the impact of climate ...) and the new export criteria accompanying as
Vietnam is a member of the trade agreements.


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Fourthly, there are not many research in Vietnam that apply quantitative
methods to assess the past impact of trade agreements on specific rice commodity
export, from which to draw qualitative comments and practical solutions.
CHAPTER2: THEORETICAL FUNDAMENT AND INTERNATIONAL
EXPERIENCE ON ADAPTATION TO IMPACTS OF TRADE AGREEMENTS
ON RICE EXPORT
2.1. Theoretical fundament for impacts of trade agreements on rice export
2.1.1. Argument about trade agreements

2.1.1.1. The concept of trade agreements
a. Traditional concept: A trade agreement is an international treaty aimed at
eliminating trade barriers, facilitating closer trade between the signatory countries, thereby
promoting economic integration between member countries.
b. Modern concept: not only be understood in the narrow scope of "shallow"
economic cooperation as traditionally understood, but also the agreement of the
"deep" economic integration between two or more groups of nations with broader and
more comprehensive commitments than trade.
2.1.1.2. Classification of trade agreements
- Bilateral trade agreement: two member countries.
- Regional trade agreement: participation of three or more member countries
which have close geographical location.
- Mixed Trade Agreement is a trade agreement between an international
economic link and a country, a number of countries or some other international
economic link, which is a special kind of bilateral trade agreement.
- Multilateral Trade Agreement is a trade agreement that includes many
signatory countries in which the WTO is typical.
2.1.1.3. Content of the trade agreements
- Content of tariff reduction
- Content of quotas.
- Content of Technical Barriers to Trade (TBTs) and Sanitary and Phytosanitary
measures (SPSs).
- Content of Safeguard measures, Anti-dumping measures, anti-subsidy.
- Other diverse content: rules of origin; Trade in Services; Investment; dispute
settlement mechanism; Government procurement, competition policy, intellectual
property, sustainable development.
2.1.1.4. Impacts of trade agreements on exports
As discussed in the study overview, the impact of a trade agreement is divided
into two tendencies that static and dynamic impact.
2.1.2. Rice export and impacts of trade agreements on rice export

2.1.2.1. Rice and characteristics of rice production

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Rice is an agricultural product and has characteristics of agricultural
production: (i) Affected by natural conditions such as land, climate, weather, ...; (ii)
Seasonal; (iii) Rice quality will directly affect the health of consumers; (iv) The postharvest processing and preservation is very important; (v) Rice has a variety of
species, rice grain shape, taste, nutritional content ...
2.1.2.2. Rice export and impacts of trade agreements on rice export
a. Some traditional and modern trade theories show that international trade has
always benefited the participating countries, thereby playing an important role in the
world economy.
b. The concept, form and role of rice export
* Concept of export, rice export
Export is the exchange of goods and services of a country with the rest of the
world in order to benefit the nations. This concept is used to specifically define export
items in general and rice in particular.
* Forms of rice export: Direct rice export; entrusted rice export; Export rice
under the protocol between the two Governments
* The role of rice export
In addition to its role in the export of goods, rice export also play a role in the
export of agricultural products: to motivate the development of sector strategies in line
with their ability and conditions to combine of national and global food security and
long-term protection of natural resources, contribute to maintaining a favorable
national and international environment for stable socio-economic development.
c. Factors impact on rice export:


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Table 2.2: Factors affecting the potential impact of a Trade Agreement

Factors of
Supply

Factors of
Demand

Economic
scale

Economic
scale

Population

Group of index

Vietnam (rice

Rice importer
from Vietnam

exporting country)

Population
Area of rice
cultivation

Area of rice

cultivation
The distance
between two
countries

Comparative
advantage

Habits,
tastes

Quality
of rice
Science and
technology

Economic
distance

Geographic
distance

Factors

Group I - Nature
of the trade

1

Type of agreement

2

The scope and extent of integration in the agreement

agreement

3

Amount and scale of participants in the agreement

4

Similarities between Members before paticipating in the
agreement

Group II Economic and
trade relations
among the
members of the
agreement
Group III Comparative
advantage and
complementarity

5

Attractive / Obstructive factors

Price of

rice export

Export
management
policies

Tariff and
non-tariff
policies

Exchange
rate
policy

Inflation

Comparative advantages of members
Complementarity in the trade of members

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9

policy of the
members of the

10

Openness
of the

economy

Figure 2.1. Diagram of factors impacting on Vietnam's rice export
Source: Author's summary
d. Impacts of trade agreements on rice export
The Analysic Framework about the factors that affect the magnitude of the
impact of a trade agreement

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Group V - Price
and elasticity of
supply, demand
and import
demand

before the agreement takes effect

6

Group IV - Trade

agreement

The economic and trade relations between nations

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in trade
International economic

relationship (trade aggreements)

Name

Ordinal

The export structure of partner country signed and did
not sign the agreement
Trade barriers between countries before the formation of the
agreement
Difference in the extent of protection of trade barriers
before and after the formation of the agreement
The complexity of the rules of origin in the agreement
The difference between the price of the countries signed

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and the price of the country not signed a trade
agreement

13

Elastic supply, demand and import demand for prices

Source: Vu Thanh Huong, 2016
In theory, a trade agreement is not only a basic direct impacting factor, but also
an intermediary factor for others (economic factors, factors of comparative advantage,
price, ...) which impacts on a country's exports of goods. Regarding Vietnam, rice is
an agricultural product for export with high volume and value and is interested of
trade negotiations. Therefore, Vietnam’s rice export are subject to signed trade

agreements’ impact, and need to consider impacts of trade agreements on Vietnam’s
rice export through a reciprocal, simultaneous linkage and combinative factors. The
author then builds the Analysis Framework:


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CHAPTER 3. ANALYZING THE CURRENT SITUATION OF IMPACTS OF
TRADE AGREEMENTS ON VIETNAM’S RICE EXPORT

Nature of the
agreement
I
Trade aggreement
-

-

Concessionary import tariff
Rules of origin
Sanitary and Phytosanitary measures
Safeguard measures
Technical Barriers
Anti-dumping measures
Dispute settlement mechanism
Customs procedures

...

II
Economic and
commercial
relations

Economic
scale

Population

Economic
distance

IV

Comparative
advantage and
complementarit

Commercial
policies

Tariff and
non-tariff
policies

V

III

Exchange
rate policy

Agricultural
production /
area of rice

Quality
of rice

Habits,
tastes

Price and
elasticity

Fearutes
of
product

Price of
rice
export

3.1. General of the development of the Vietnam’s rice sector
3.1.1. The situation of Vietnam’s rice production and export from 1981 to 1999
- Regarding production, with two outstanding policies were “Khoan 100” in
1981 and “Khoan 10” in 1988, the Land Law in 1993 and other supporting policies
related, the area, yield and productivity of rice in the period 1981-1988 had positive
changes and in the period 1989 - 1999, these indicators increased because the

production was mainly based on the direction of intensive cultivation.
- Regarding export, with renovation in market, the quality, types, price of rice
export, channels of distribution, rice exporters, tariff and quota, Vietnam first exported
its products ranked 3rd in the world in 1989 and 2nd in the world in 1997.
3.1.2. The situation of Vietnam’s rice production and export from 2000 to 2017
Regarding production, the area of rice cultivation was unstable and tends to be
declining in recent times. The increase in rice yield mainly depended on increasing
productivity. This figure in 2016 and 2017, rice yield was down from 2015 to make
the trend of rice productivity was similar change.
Regarding export:

Rice export of Vietnam

Include / constitute
Direct Impact
Indirect effect
I, II, III, ...: Order of group index factors affecting the trade agreements’ ability to impact
Figure 2.2. Framework for analyzing impacts of trade agreements on rice export
of Vietnam
Source: Author's summary
2.2. International experience on adaptation to impacts of trade agreements on
rice export
From the export experience of Thailand, China, India under the impacts of
trade agreements, the thesis draws the following lessons: (1) promote comparative
advantages in rice production and meet technical barriers; (2) sttrengthen safeguard,
dispute settlement by price and subsidy policy; (3) Creating a favorable environment
for accessing the rice market through tariff tools and trade promotion; (4) It should be
based on the economic potential and actual conditions of the rice sector in Vietnam;
(5) There is a need for innovation in identifying the role of the rice sector in entering
into trade agreements.

Figure 3.4. Vietnam’s rice export in the period 2000-2017
Source: Vietnam Food Association (VFA - />3.2. The reality of impact of trade agreements on rice export of Vietnam in
the period 2000 - 2015
3.2.1. Overview of Vietnam's trade agreements
3.2.1.1. The process of participating in the trade agreements of Vietnam


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Vietnam's Trade Agreement

Trade agreements signed /
validated

Trade agreements are
negotiating / not signed

Bilateral agreements

Mixed agreement

Vietnam - Japan
(Validated in 2009)

ASEAN (Validated in 1996)

Vietnam – EU
(negotiation finished)

ASEAN – China (Validated in

2005)

Vietnam - Chile
(Validated in 2014)

RCEP

ASEAN – Korea (Validated in
2007)

Vietnam - Korea
(Validated in 2015)

Vietnam - EFTA

ASEAN – Japan (Validated in
2008)
ASEAN – Australia/ New
Zealand (Validated in 2010)

Vietnam – Israel

ASEAN – India (2010)
Vietnam – Asian-Euro Union
(Validated in 2016)
ASEAN – Hongkong (Validated in 2019)

CPTPP (Validated in 2019)

Figure 3.5. The situation of participating in the trade agreements of Vietnam

Source: Author's summary from the information on the site: />3.2.1.2. The contents of the trade agreements are related to rice export
Table 3.1. The field of integration of trade agreements
AFTA ACFTA AKFTA AJCEP VJEPA AIFTA AANZ- FTA VCFTA VKFTA VN-EAEU FTA AHKFTA

i
ii
iii
iv
v
vi
vii
viii
ix
x

√
√

√

√
√

√
√

√

√

√

√

√
√
√
√
√

√

√
√
√
√
√
√
√
√
√

√
√
√

√
√

√

√
√
√
√
√
√
√
√

√
√
√
√
√

√
√

√
√
√
√
√
√
√
√
√

√
√

√
√
√

√
√
√
√
√

√
√

√

√

Source: Author's summary from the information on the site: />(i) Contents of tariff: MFN, CEPT or ATIGA are tariff-cutting instruments; (ii) the content
of rules of origin; (iii) Content of Sanitary and Phytosanitary measures; (iv) Safeguard
measures; (v) Technical Barriers; (vi) Anti-dumping measures; (vii) Contents of

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Competition; (viii) Dispute settlement mechanism; (ix) Customs procedures; (x)
Business environment
3.2.1.3. General assessment
- After Vietnam applied for membership to the WTO, Vietnam has truly strong
integration.
- Trade agreements tend to be richer and more diversified contents and areas of
integration, and the level of association is getting "deepening”.
- For most of the regional and mixed agreements that Vietnam has signed, the

Association of Southeast Asian Nations (ASEAN) has a dominant role.
- ACFTA usually take largest density of rice imports from Vietnam compared
to total Vietnam’s rice export
3.2.2. The reality of impact of signed trade agreements on rice export of
Vietnam
The thesis used two approaches which are Benefit Analysis Framework and
Structural Gravity models to analyze the reality of impacts of trade agreements on rice
export of Vietnam in the process of integration (in chronological order of the trade
agreements validated) and the type of agreement
3.2.2.1. Approach from the benefit analysis framework
Based on the factors that affect the faculty of impact of a trade agreement, for
each agreement includes: AFTA, ACFTA, AJCEP, AKFTA, AIFTA AANZFTA,
VJEPA, VKFTA, VCFTA, the thesis clarifies the characteristics, nature and economic
relationship between the member countries in each agreement, the comparative
advantages of agricultural production of Vietnam. Besides, member countries, as well
as the changes in rice import tariff policies of member countries for Vietnam’s rice
when the agreement validited. Thesis compares the quantity and value of rice exported
by Vietnam to member countries before and after the agreement validated.
a. The period before 2007
- AFTA: The total volume and value of Vietnam's rice export have changed
markedly before and after the signing of the AFTA. The upward happening is inherent in
milestones when member countries of AFTA implementing commitments to reduce rice
import tariff of Vietnam. While the Philippines, Malaysia and Indonesia are major
importers of Vietnam’s rice with annual volumes of approximately 1 million tons and
regular customers for Vietnam’s rice, Myanmar is the importer of Vietnam’s rice at least in
volume and value.
- ACFTA: although China's commitment to reducing rice import tariffs was
enforce 10 years later (in 2015), when the agreement entered into force, the export of
Vietnam’s rice to China was higher than in previous years. After 5 years since the
time of validity, China imported Vietnam’s rice with a sudden increase in volume and

always kept high.


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Table 3.6. Export volume of Vietnam's rice to member countries under trade
agreements with ASEAN in the period 2000-2015 (ton)
Year
China
Korea
Japan
Australia và
New Zealand
India
Năm
China
Korea
Japan
Australia và
New Zealand
India

2000
1769
18144
13185

2001
2240
19065
25952

2002
9083
5000
5084

2003
1150
387
46610

2004
82671
0
75335

2005
50817
42
197007

2006
43218
97
165222

2007
42780
72
64640

23754

2871

11378

1557

4479

3202

1552

2703

57315
2008
3049
55
15065

11000
2009
20760
938
4166

1009

2010
124806
4829
2

375
2011
233774
15117
0

1238
2012
1545079
54710
28374

2152
2013
1480958
2969
918

2
2014
1352048
46992
11243

500

2015
1794261
43378
5182

3609

9994

8928

9429

6675

7835

8957

10326

1951

2020

47

0

5

5

0

0

Source: data from the General Statistics Office ( />b. The period from 2007 to 2015
- Mixed trade agreements
+ Korea: Commitments on reducing import tariffs were implemented from
January 1st, 2007, gradually reduce leading to eliminate from January 1st, 2010. After
the validity of AKFTA, the volume of Vietnam's rice export to Korea remained very
low in 2007-2008. It increased sharply from 2009, especially during the period 2010 2012 (when the rice import tariff South Korea is zero).
+ Japan: No promises to reduce tariff for Vietnam’s rice imported into Japan.
During the period 2000 - 2015, the volume of rice imported into Japan was up and
down irregularly. Since AJCEP validated, Vietnam's rice export have declined
countinuously and Japan did not imported Vietnam’s rice in 2011 due to technical and
quarantine barriers to rice products. Then Japan continues to import Vietnam’s rice
but remains low and unstable.
+ Australia and New Zealand: Commitments on concessionary tariffs for rice
of the two countries with Vietnam have been eliminated since Vietnam participated in
the WTO (end of 2006), so the volume of Vietnam’s rice exported to these two
countries tends to increase from 2007 (when Vietnam enjoyed concessionary tariffs
from Australia and New Zealand thanks to WTO accession).
+ India: maintaining high import tariffs on Vietnam’s rice (70% - 80%), the
volume of rice that this country importing from Vietnam declined countinuously and
clearly over the years. The time of validy of AIFTA marked the fact that India has
hardly imported rice from Vietnam.
- Bilateral trade agreements
Japan has a much larger import volume than South Korea and Chile, especially

in the period 2003-2007 (the period before the VJCEP vadilated), but since the time of

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VJCEP validity (in 2009) to 2015, this import volume declined dramatically. Chile
began importing Vietnam’s rice since 2003 and increased Vietnam’s rice import since
2010. However, since the VCFTA agreement came into effect in 2014 with tariffs
applied to rice imported from Vietnam to this country is 6% in 10 years, this amount
of imported rice drops about 50% per year. The Vietnam-Korea bilateral agreement,
which took effect in 2015, may be the reason why Vietnam's rice export to South
Korea increased again in 2014 and 2015 after suddenly dropping in 2013.
* Comparing rice export structure to member countries and groups of countries
Exported Vietnam’s rice consists of 4 types: milled rice, brown rice, broken rice
and paddy in which paddy is exported in a very small volume with the main aim of
facilitating trade relations between Vietnam and other countries. The difference in
income, demand, and consumer tastes of rice leads to the difference in the type of
imported rice in each member country, in which milled rice is “favorite” rice of many
countries in the world, especially ASEAN member countries like the Philippines,
Malaysia, and China; brown rice is Vietnam's high-grace rice although it is exported at a
very small proportion compared to the total amount of rice exported by Vietnam, which
South Korea, Australia and New Zealand imported but unstable; broken rice is less
preferred and low prices so, it was imported mainly by ASEAN countries and China.
. * Compare average price of rice export to member countries and groups
The average export price of rice to countries and groups of regional trade
agreements tended to increase and decrease during this period, in which the average
price of rice exported to Korea, India, Australia and New Zealand is often higher.
ASEAN and China are Vietnam’s rice importers with lower average prices.
Considering each type of rice: milled rice exported to high-life markets such as Korea,
Australia and New Zealand are more beneficial to middle-income countries such as
ASEAN and China; broken rice makes lower average export price of rice to the
countries that import this rice with more weight. This suggests that it is necessary to

consider the type of rice to be exported for each market classification: it is more
beneficial to export rice to a higher-grade markets. The situation of rice dumping also
makes Vietnam's rice export ineffective.
3.2.2.2. Approaching from structural gravity model
a. Structural gravity model
The traditional gravitational model is based on the idea of Newton's Law of
Gravitation, which is a function of the characteristics of the exporting country, the
importing country and the obstruction between these two countries. This gravity model is
developed on a strong theoretical basis, especially the Structural Gravity Model classes
with the Armington-Constant Elasticity of Substitution, CES, together with PPML
(Poisson Pseudo Maximum Likelihood) estimation techniques.
Taking the natural logarithm, we have the equation:
ln X ijt = ln E jt + ln Yi , t − ln Yt + (1 − σ ) ln τ ij , t − (1 − σ ) ln P j , t − (1 − σ ) ln π i ,t + u ij ,t
which represents bilateral trade costs is represented:


15
(1 − σ ) ln τ ij ,t = β1 ln DISTij + β 2CNTGij + β 3CLNYij + β 4 LLOCK j + β 5 RTAij ,t + β 6 BTAij ,t + β 7τ ij ,t
In terms of experiment, due to data limitations, the thesis uses compact gravitational
structure:
ln X ij ,t = a 0 + a1 ln GDPvn i ,t + a 2 ln EXP j ,t + α 3 ln RER ij ,t
+ b1 ln DISTij + b2 CNTGij + b3CLNYij + b4 LLOCKj + c1 RTAij ,t + c2 E j ,t Agreeij ,t + c3 BTAij ,t + eij ,t

where a0 is the intercept, and aj, bj, cj ϵ N++ are the parameters to be estimated in the
gravitaty model;
X ij ,t : Vietnam's bilateral rice export value to the economy j;

GDPvni ,t : Vietnam's gross domestic product;

RERij ,t : Real bilateral exchange rate between Vietnam and country j;

EXPj ,t : Total final consumption expenditure of the economy j;

DISTij : The geographical distance between Vietnam and the economy j is
measured by the distance between Hanoi and the capital of the partner countries;
CNTGij : Dummy variables take 1 if Vietnam and the economy j share border
lines and 0 in other cases;
CLNYij : Dummy variables take 1 if Vietnam and the economy j share the same
colonial system before and 0 in other cases;
LLOCK j : Dummy variables take 1 if the economy j is landlocked and 0 in other cases;

RTAij ,t và BTAij ,t : Dummy variables with multilateral and bilateral integration
takes 1 if Vietnam and the economy j are paticipated in Regional Trade Agreements
and validity at time t and 0 in other cases;
E j ,t Agree ij ,t : Interactional variables between the trade agreement dummy and
the total final consumption expenditure of the importing country;
eij ,t : The random error in the model is assumed to follow the normal
distribution rule with mean is 0 and constant variance.
b. Results of empirical analysis
The results of structural gravity estimation for 60 countries which are the main
rice importers of Vietnam (Vietnam's rice export to 60 countries with a total proportion
of over 90% of Vietnam's rice export turnover) from 1998 to 2015, most variables are
statistically significant with high reliability.
* The overall impact of trade agreements
- Impact from the demand: the final expenditure variable of Vietnam's rice
importing countries in the model is positive and very small value, which is consistent
with the characteristics of the rice industry in the current period. When income
increases, demand for food commodities tends to increase at lower level.
- Attractive / obstructive impacts: the estimated coefficient of dummy variables for
landlocked countries with negative sign implies that countries that are not adjacent to the

sea impede rice export transactions between Vietnam and countries; exchange rate policy
seems to be ineffective in promoting Vietnam's export of goods when it is negative.

16
- Agreement dummy variables: WTO dummy variable estimates showed that
WTO accession promotes Vietnam's rice export activity when the estimated
coefficient was positive but this effect is not significant. The estimated coefficient of
AFTA dummy variable with positive value indicates the positive impact of AFTA on
Vietnam's rice export by about 0.2% higher than the remaining countries. However,
Vietnam did not actively exploit the advantages of rice export when signing the
ASEAN+6 trade agreements as the coefficients of this dummy variable bring negative
values at 0.24%. It is unclear how to exploit the benefits of signing bilateral free trade
agreements. The coefficient of the interaction variable between the trade agreement
and the final expenditure is statistically significant and the very small positive value. It
indicates that when there are impacts of trade agreements, the expenditure of
importing countries is for consuming rice imported increased insignificantly.
* Comparison of impacts between ASEAN+6 trade agreements
Considering the total impact of the 5 ASEAN+6 trade agreements, this impact
was negative. However, when the marginal impact of each trade agreement is split,
including AIFTA, ACFTA, AKFTA, AJCEP, AANZFTA, the structural gravity
model recorded a positive effect from the signing of ACFTA, AKFTA and
AANZFTA with the estimated coefficients of these dummy variables were positive
values of 0.295%, 0.222% and 0.284% respectively. The opposite is noted for the
AIFTA and AJCEP agreements with a negative estimate, the impact of the AIFTA
agreement had a significant negative impact at 0.545%.
3.2.3. Evaluate the impact of trade agreement on Vietnam's rice export
From two approaches include Analyzing framework and structural gravity
model, the thesis provides assessments on the impact of trade agreement on Vietnam's
rice export through the following table:

Postive
Increase

2008

2010

2010

AJCEP

AIFTA

AANZFTA

4

5

6

Source: synthetic author

Medium
Similar
Small
Small
2007

2007
AKFTA
3

0%

Negative

Negative
Large
Large
Similar

2005
ACFTA
2

Exclude from list

Not
similar

Medium

Decline
strongly
Decline
strongly
High

Less
similar
Less
similar
Large

1996
AFTA
1

2007 - 2010

Time
of
validity
Agreement
No.

Exclude from list

Not
similar

Small

Postive
Increase
Medium
Similar
Medium

Less
similar

Small

Postive
Increase
Large

2003
2004
2010 - 2015
2015
2018

10%
5%
0%
20%
5%
Gradually
decrease
to 0%

Similar

Large

Similar

Medium

Postive
Increase
Medium
Similar
Large
Large

Population
Economic
difference
Implementary
period
Discount
level

Similar

Types of
consumer
rice

Technical
standards
required

Rice
export
trend

before
and after
the
agreement
validity
Proportion
of
agricultural
production
Preferential tariffs

17

Bảng 3.11. Tổng hợp tác động của các hiệp định thương mại hỗn hợp đến xuất khẩu gạo của Việt Nam
giai đoạn 2000 – 2015

Impact
trend
(gravity
model)

18
3.2.3.1. Impact of trade agreement on rice export through a level of integration
Impacts of trade agreements on rice export is less dependent on the number of
signed trade agreements and the degree of diversity, "depth" of the field of trade
negotiations and association of trade agreements. Trade agreement which gives
member countries with socio-economic characteristics related to new suitable rice
products to Vietnam brings a clear positive impact on Vietnam's rice export.
3.2.3.2. Impacts of trade agreements on Vietnam's rice import of the members’
demand

- The impact of income of importing countries on rice export of Vietnam is
only low but impacts of trade agreements makes the expenditure on imported rice
from Vietnam increase despite a small relatively.
- Members which have proximate economic, close geographical to Vietnam or
a comparative advantage, complementary to rice trade, having similarities between the
type of consumer rice and Vietnam’s rice export. This lead to an increase in demand
for imported rice from Vietnam, so trade agreements signed between Vietnam and
those member countries has a positive impact on Vietnam’s rice export and vice versa.
3.2.3.3. Impacts of trade agreements on Vietnam's rice export trade barriers
First, with the ASEAN+6 trade agreements, preferential import tariffs can be
considered as a less content to create discrimination between countries participating in
trade agreements compared to other factors.
Secondly, clear rules of origin and the need to meet the technical barriers of
products create great barriers to Vietnam’s rice export when penetrating markets,
especially those with high living standards and rigorous quality like Japan, United State.
3.2.3.4. Impacts of trade agreements on structure and price of Vietnam's rice export
Countries with higher living standards tend to import higher quality rice
varieties than countries with lower living standards. In addition, the export of medium
rice will bring more benefits in the middle market and higher grade rice will be more
suitable for the higher end market.
3.2.3.5. Impacts of trade agreements on Vietnam's rice export through
geographical distance and exchange rate factors
The impact of rice trade creation of signing trade agreements with members
through geographical distance factors are not yet clear. Besides, the impact of
exchange rates on rice export is in fact consistent with the theory.
3.3. Advantages, limitations and causes of limitations when Vietnam's rice
export are affected by trade agreements
3.3.1. Advantages
- Trade agreements further promote Vietnam’s rice export with member
countries with or without income similarities, close to geographical distances,

similar rice consumption habits or having comparative advantages and additional
capabilities in the agricultural sector, including rice production compared to those
countries or not.


19
- Import tariffs on Vietnam’s rice are gradually eliminated with most trade
agreements when they validate.
- The trade agreement provides a solid basis for quality as well as legal
standards for rice when Vietnam exports when rice import and export disputes occur
with member countries.
3.3.2. Difficulties and limitations
- Vietnam's rice importers are still mostly familiar customers, some new
markets are not members that Vietnam has signed.
- The competitiveness of Vietnam’s rice is still poor, although Vietnam's
average export price of rice is lower than other countries.
- Mixed trade agreements are easy to create a trade diversion when Vietnam’s
rice does not differ or excel in characteristics as well as quality or is not suitable for
rice consumption culture.
- The technical regulations and import-export procedures stated in the agreement
make many Vietnam’s rice exporters bring rice to markets by the unofficial way (small
quota), making significantly impact on prestige domestic rice.
- The phenomenon of rice export only attaches much importance to the quantity
and neglects the quality of rice, that makes rice export value inadequate.
- The direct combined effects of trade agreements are positive but still low.
3.3.3. Cause of limitations
Firstly, Vietnam's rice variety and quality have little innovation, its
decentralization at medium level and are often suitable for the current markets of
Vietnam (Asia, Africa). It is difficult to expand to High-end markets such as the US,
Japan and Europe. Vietnam has not yet really built up its own brand.

Secondly, Vietnam's rice has not really been produced, processed, preserved
according to the agricultural product value chain process consistently before exporting.
Thirdly, Vietnam has not yet considered the investigation and collection of
information on fluctuations in rice supply and demand in the world.
Fourthly, inaccurate and incomplete about the contents of the signed trade
agreement and the lack of interest in the rice export benefits during the negotiation of
trade agreements.
CHAPTER 4
SOME SOLUTIONS TO ENHANCE THE ADAPTABILITY OF
VIETNAM’S RICE EXPORT TO IMPACTS OF
THE TRADE AGREEMENTS BY 2030
4.1. Rice export and import trend in the world affects Vietnam's rice export
4.1.1. Fluctuations in global rice supply and demand
- Considering the global rice supply fluctuations, besides countries such as
Thailand, India, Pakistan with the total rice export market share of these countries
account for about 80% of the total export of rice worldwide, currently. The rice export

20
market has appeared emerging countries with abundant rice supply, good quality and
competitive prices.
- Considering world demand fluctuations for Vietnamese rice, large importers of
Vietnam’s rice are still Asian countries (China, Philippines, Indonesia ...) and Africa
(Ghana, Côte d’Ivoire, South Africa...). For high-end markets such as the US, Japan, and
Europe, the amount of Vietnam’s rice exported is tending to increase slowly.
4.1.2. Changes in rice export and import policies of countries affecting
Vietnam's rice export.
Thailand discharges rice stock, China with a large amount of Vietnam’s rice
export through small quota to reduce costs, fluctuations in exchange rates of countries,
rice trade agreements MAV, the Nigerian government increased rice import tax to
encourage domestic people towards stopping rice imports...

4.1.3. The impact of the commercial war
The trade war between the United States and China is a new manifestation of
trade protectionism and the viewpoint of anti-globalization which may increase
Vietnam's rice export opportunities into these two markets to fill the gap. However, it
is also possible to reduce the import of rice from Vietnam to two markets because
Vietnam’s rice export may be subject to similar import tariffs from the two countries.
4.2. The situation potential impacts of trade agreements has not validity
and trade agreements are negotiating for Vietnam's rice export.
Expenditure on these groups of members had a positive influence on Vietnam’s
rice export even though the total effect is not high. In particular, the final consumption
of the "more advanced" European market is likely to impact Vietnam's rice export at a
clearer level but have limited geographical distance and bilateral exchange rates.
The average export price of Vietnam’s rice to EFTA is the highest in recent
years. Israel and Hong Kong are also the two Vietnam’s rice importing countries at
relatively high prices. Countries with the proportion of imported broken rice has
increased, the average export price of rice has decreased.
4.3. Trend of the impact of Vietnam's trade agreements on rice export
4.3.1. Trade agreements and tariff barriers for Vietnam’s rice export
Vietnam’s rice must meet the rules of origin and be shown accurately and
clearly on the package to be included in the list of commitments to enjoy preferential
tariffs when importing into member markets of the trade agreements that Vietnam
participates in. Therefore, establishing agricultural value chains for Vietnam’s rice
export helps exporters easily complete the certification procedure of origin.
4.3.2. Trade agreements and non-tariff barriers to Vietnam's rice export.
Technical barriers, price regulations, subsidies and rice export policies are content
that Vietnam needs to pay more attention to when it comes to trade agreements because
these are relatively sensitive issues for the Vietnam’s rice industry. Hence, it makes
Vietnam’s rice export easy to violate international conventions.
4.3.3. Trade agreement and climate change for Vietnam's rice production
Climate change reduces the area of rice cultivation, causing appearing some

"harmful" species due to changes the living conditions of living species, changing the


21
structure of crops, etc. Since then the rice productivity has also changed, the quality of
rice products is also affected.
4.4. Some solutions for Vietnam’s rice export to adapt to the effects of
trade agreements
4.4.1. Adapting to the content of rules of origin, technical barriers and
phytosanitary of trade agreements
Export rice should be followed the process of agricultural value chain in
accordance with the trade contents of the trade agreement. Namely:
Firstly, technical standardization for each stage from the production to the
export of rice includes: selection of varieties, cultivation, harvesting, processing and
packaging.
Secondly, build a link between the stages through the implementation of
synchronous investment, creating vertical links, managing rice by value chain,
gradually reducing intermediate circulation.
Thirdly, creating close links between the stakeholders involved in rice production
and export activities, which are "four houses" relationship: state, scientists, businesses and
farmers.
4.4.2. Adapting to the competitive and business content of trade agreements
4.4.2.1. Diversify rice products
Vietnam's rice export need to target all three market segments, with priority
given to the high-end market although the middle market is a potential market and the
low-end market is a complementary market. Thence, finding new markets, expanding
markets and diversifying Vietnam’s rice import markets will contribute to taking
advantage of the benefits of trade agreements.
4.4.2.2. Trade promotion for rice export
- Need to determine what rice products should be included in the trade

promotion list and to introduce to the market, especially for new markets and new rice
products. Need to determine what market is the immediate market and where is the
long-term market.
- Collect and analyze market information to show what rice products are and
how to enter the market for each market arrangement.
4.4.3. Adaptation to tariff commitments, anti-dumping and dispute settlement
mechanisms of trade agreements
4.4.3.1. Tariff tool
Flexible export taxes for each type of rice and each level of deep processing or
preliminary processing can be applied to adjust the structure of rice products, thereby
adjusting the structure of rice export in a positive direction.

22
4.4.3.2. Non-tariff tools
a. Quota
Application of quotas should: (i) according to demand and supply; (ii) being offered
to sell the tender so that businesses can participate publicly; (iii) allow enterprises to
transfer quotas to one another; (iv) combined with tax tools; (v) must be calculated so that
businesses can buy more favorable quotas; (vi) need to adjust towards increasing taxes and
quotas that appropriate to national interests and security.
b. Policy of price and subsidies
- The state needs support to help Vietnam's rice industry has clear movement in
stabilizing export rice prices without damaging the interests of rice producers.
- This form of rice export subsidy should only be at a moderate level and within the
allowable limit of trade regulations to avoid trade distortions. Too low export prices will
violate the anti-dumping regulations in the trade commitment.
c. Exchange rate policy
- Adjusting the exchange rate to match the actual purchasing power, on the other
hand proceeding to devaluate Vietnam dong in a suitable way to encourage exports and
attract foreign investment.

- Relative stability is ensured.
- Consider this tool as a supportive measure when working closely with many
other policies.
4.4.4. Adapting to the sustainable development content of trade agreements
The chapter on Sustainable development of trade agreements deals with
environmental areas and obligations including climate change. Therefore,
restructuring rice production increases efficiency in rice production, other types of
crops and fisheries, creates more jobs, increases income for people and contributes to
environmental improvement. When implementing the restructuring of Vietnam's rice
industry, it is necessary to unify the viewpoint: (i) respect the natural and social laws;
(ii) ensuring rice remains a place based on economic, security, national defense and
national identity; (iii) adapt to the environment; (iv) in accordance with market
economy rules; (v) all economic sectors are subjects in the process of restructuring the
rice industry; (vi) applying science and technology.
4.5. Some petitions
4.5.1. For the Government
- The Government needs to develop strategies and plans to develop production
and export of rice to adapt to the trend of international economic integration and in
line with industry characteristics; further specifying documents aimed at adjusting the
entire production and export of rice in accordance with the agricultural value chain,
appropriate to the contents of trade agreements; demonstrating the role in negotiating
and signing trade agreements towards the goal of protecting the interests of Vietnam's
rice industry but still ensuring suitable for international practices; build and maintain
close links between the state and businesses, with scientists and farmers.


23
4.5.2. For ministries and branches
- The Ministry of Agriculture and Rural Development shall develop documents
to organize and direct the implementation of rice production activities according to

international technical and quarantine standards; actively participate in negotiating and
consulting to sign international treaties related to rice industry and rice export sector;
promoting the role of focal point in the construction and development of Vietnam’s
rice brand.
- Ministry of Industry and Trade should issue documents to guide in detail
international processes, procedures and practices for rice export activities; directing
the implementation of activities to promote Vietnam’s rice products trade; ensure the
balance of supply and demand of the domestic and foreign rice market; review and
improve rice trade policies in line with integration commitments.
- The Ministry of Science and Technology shall coordinate with the Ministry of
Agriculture and Rural Development in intensifying the signing of investment
agreements and technological assistance in the stages of breeding, production,
harvesting, preservation, processing and package for products of rice and rice exported.
Active participation in evaluating rice product quality inspection technology according
to international standards
- The Ministry of Health needs to strengthen coordination with the Ministry of
Agriculture and Rural Development and the Ministry of Science and Technology in
managing quality, hygiene and safety for exported rice products, ensuring
environmental standards of trade aggreement.
4.5.3. For Vietnam Food Association
Firstly, directly operate and organize the implementation of research activities
and participate in the application of new rice production models in a positive and
effective way.
Secondly, it is a bridge between the State and farmers, with businesses to have
unified operation as well as timely support of policies and information.
Thirdly, actively expanding cooperation with foreign units and organizations in
their permission to not only directly access information, participate and cooperate,
promote and market rice products to international markets.
CONCLUSION
The appearance of a trade agreement has impacts on the import and export

activities of all sectors in our economy at different levels. Vietnam’s rice export are
also inevitably affected by this typical international economic integration. In addition,
the rice industry itself is also changing by other objective and subjective factors. Rice
export will receive these impacts positively and clearly when the rice industry is
increasingly adapting to the negotiating contents of trade agreements. However, it is
not far from market laws, in harmony with the development of the industry, with other
agricultural products and ensuring the sustainable development of the environment.
With the goal of rice export more adaptable to impacts of trade agreements and in the

24
context of new international economic integration, the thesis achieves the following
results:
Firstly, the thesis researches and selects the contents of trade agreements
related to specific rice items, which are clear bases of rules of origin, technical
standards and sanitation, business environment,..., that requires rice export to
comply. In addition, the thesis adds separate regulations for Vietnam's rice export
to be followed by each rice importer;
Secondly, trade agreements can directly affect Vietnam's rice export through
negotiated contents, which can have indirect impacts factors affecting their influence
ability which include: economic gap, comparative advantage, complementarity in
agricultural production between Vietnam and the Vietnam’s rice importing country,
similarities/ differences in the structure of rice export with the type of rice consumed
by the importing country... (combined with the Analysis framework and Structure
gravity model);
Thirdly, regarding the overall impact, Vietnam’s participation in trade
agreements minorly promotes its rice export. Regarding the particular impact, not all
valid trade agreements that Vietnam has participated deliver positive impacts to rice
export. Only those that bring about members with socio-economic conditions favorable
for Vietnam’s rice export in terms of comparative advantages, complimentarity,
consumer tastes, etc., that has a positive impact;

Fourthly, the thesis presents the impact trend of trade agreements on Vietnam’s
rice export, on global rice supply and demand fluctuations, on the changes in export
policies and in natural conditions. These are headline issues for rice industry, requiring
the whole industry to respond to make Vietnam’s rice more accessible to any market in
the world and rice export needs to be improved in quality, not just in quantity;
Fifthly, based on the results of the research and experience in rice export under
impacts of trade agreements with some countries as well as the global trend in rice
export and import, the thesis proposes some recommendations for Vietnam's rice
export to adapt to the contents of trade agréments. These include (1) technical
standardization in rice production and maintaining the linkage between different
production stages and between stakeholders; (2) proactively adjust rice export policies
such as product policies, tax policy, trade promotion, exchange rate policy that
conforms to general international practices and each individual import market as well
as to suit the specific characteristics of the industry; (3) step by step restructure the
rice industry to produce and export rice in accordance with the content of
environmental protection, to create jobs and income to the agricultural and rural areas,
and to harmonize with the development trend of international economic integration,
contributing to the promotion of positive impacts of trade agreements to rice export,
toghether with ensuring the economic - social - political - cultural significance of rice
production towards sustainable development.