It would depend much on how Vietnam takes advantage of the pact and copes with related problems, and only with appropriate efforts would the country be able to achieve its potential and overcome challenges, Khánh, who was the head of Vietnam’s TPP negotiation delegation, said.

Speaking at the “TTP Dialogue – Envisioned growth opportunities for businesses in Vietnam” conference yesterday, he said the TPP would facilitate trade with and investment in the 12 countries involved in the pact, who account for 40 per cent of the world’s GDP.

It would help attract more foreign investors to Vietnam for setting up their production chains, enable the nation to become a part of their manufacturing and supply chain base, and help Vietnamese firms become part of the chains, he said.

Besides investment and trade commitments, the new generation free trade agreement requires much higher standards of international compliance, including creating a fair and non-discriminatory business environment, which would help create a sound trade and investment environment in the country, he said.

Tran Dac Sinh, chairman of the HCM Stock Exchange, said the TPP is expected to benefit the bourse as companies, including in the supporting industries, take advantage of trade benefits.

Portfolio investment from abroad would also increase sharply, creating a momentum for market growth, he said.

Khánh said: “Several studies have found that the TPP would create huge economic opportunities for Vietnam, but these researches were based on the premise ‘with other conditions remaining stable’.

“If the world economy suddenly faces difficulty, our economy will be affected.

“Opportunities cannot by themselves turn into benefits; it depends on the efforts made by all: the more you prepare, the more successful you will be.”

Besides, opportunities always go hand in hand with challenges due to fierce competition, and businesses need to be courageous to compete and should take the initiative to innovate to improve their competitiveness, he said.

“Businesses should not compete only on price, but also quality and prestige.”

He urged Vietnamese firms to focus on improving their management and adopt modern marketing methods.

To enjoy the benefits of TPP, Vietnamese goods would have to comply with regulations on origins, quality, and others, he said.

For instance, the “yarn-forward” rule in the garment and textile sector could be a challenge in the short term, but in the long term it would help the domestic industry develop a complete supply chain, he said.

In the last two years investment in the fibre and yarn making has shot up, equalling the entire previous investment, he said.

Nguyen Công Ái, deputy general director of KPMG, said, “A number of Taiwanese and South Korean investors have poured hundreds of millions of dollars in Vietnam’s textile and dyeing sectors.”

Local companies have also stepped up investment in the sectors, he said, adding they have done extensive studies to thoroughly understand the “yarn-forward” rule to capitalise on opportunities to boost exports to markets like the US and Japan when the TPP comes into effect, he said.

The seminar was organised by the Vietnam Chamber of Commerce and Industry in collaboration with KPMG and HOSE.