Dr.

Nguyen Thi Cuc Hong

Lecturer, Faculty of Economics
Term 1_School year 2024-2025
 COURSE CONTENTS

UNIT 1. INTRODUCTION TO IES

UNIT 2. UNITED NATIONS

UNIT 3. WORLD BANK

UNIT 4. THE INTERNATIONAL MONETARY FUND

UNIT 5. WORLD TRADE ORGANIZATION

UNIT 6. THE REGIONAL TRADE INSTITUTIONS (FTAs)

UNIT 7. APEC, ASEM, ASEAN & THE AEC COMMUNITY

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 UNIT 1 – COURSE OVERVIEW

❖ Course syllabus
❖ The conceptual framework of IEIS and their
significance in the global economy
❖ Historical background & purposes of key
institutions

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 THE CONCEPTUAL FRAMEWORK

1. IEI are organizations established by multiple countries to

manage and regulate economic relations and policies on a
global scale.
2. The aim is to foster economic cooperation, stability, and
development across nations.
3. They play a crucial role in facilitating international trade,
providing financial assistance, and promoting economic
growth and stability.

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 THE CONCEPTUAL FRAMEWORK

4. IEI such as IMF, the WB and WTO among others work to

ensure global economy operates smoothly by addressing
issues like
a. Financial crises
b. Trade disputes
c. Development challenges
5. Their various programs and initiatives help countries achieve
sustainable economic growth and improve the living
standards of their populations

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SIGNIFICANCE TO GLOBAL ECONOMY

EIE helps create a more interconnected and resilient global

economy through:
• Economic stability and growth
• Facilitation of international trade
• Development and poverty reduction
• Economic integration
• Policy coordination
• Capacity building

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ECONOMIC STABILITY & GROWTH

• Provide financial support

and policy advice to
countries facing economic
crises
• For example, IMF offers
financial assistance and
economic guidance to
countries in need

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FACILITATION of INTERNATIONAL TRADE

• Reduce trade barriers and ensure smooth and fair trade between countries
• Promote economic growth & development, enabling countries to access
larger markets
• WTO offers financial assistance & economic guidance to countries in need
DEVELOPMENT & POVERTY REDUCTION

• Provide funding and expertise for development projects in

developing countries
• Many projects aim to reduce poverty, improve infrastructure, and
promote sustainable development
 ECONOMIC INTEGRATION

Regional economic institutions, such as EU and ASEAN

• Promote economic cooperation among member countries
• Increase economic cooperation and reduce trade barriers; and
• Unify economic policy
POLICY COORDINATION
• Facilitate coordination
of economic policies
among countries
• Helping addressing
global economic
challenges, like
✓ Financial crises
✓ Climate change; and
✓ Economic
inequality
 CAPACITY BUILDING

• Provide technical assistance and training

• Help countries build economic capacity and improve governance
• Improving financial systems, regulatory frameworks, public administration
 HISTORICAL BACKGROUND
Evolution and Expansion
• Over the decades, these institutions have evolved to address
new global challenges such as financial crises, climate
change, and sustainable development.
• They have expanded their roles to include policy
coordination, capacity building, and promoting economic
integration and cooperation among nations
• These institutions have played a pivotal role in shaping the
global economic landscape, promoting stability,
development, and cooperation among countries.

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 HISTORICAL BACKGROUND
No. Organization/ YOE Purpose Key milestones
institution
1 Bretton Wood 1944 Foundation of modern • Delegate from 44
Conference international economic countries met in Breton
institutions Woods, New Hampshire,
to create a framework for
postwar international
cooperation and
reconstruction
2 IMF 1944 Ensure stability of • Focus on stabilizing
international monetary exchange rates and
system by providing rebuilding economies
financial assistance and after WWII
policy advices to member • Include surveillance of
countries global economic trends
and financial crises
management
No Organization/ YOE Purpose Key milestones
institution
3 World Bank 1944 Provide financial & • Initially focus on post-war
technical assistance to reconstruction in Europe
developing countries for • Shifted focus to developing
development projects countries in the 1950s,
(health, infrastructure, financing infrastructure
education) projects and poverty
reduction initiatives
4 GATT 1947 To promote GATT was replaced by WTO
international trade by and expanded its scope to
reducing tariff and other include trade in services and
WTO 1955 trade barriers intellectual property
5 EEC 1957 Aimed at economic
EU integration among
European countries
ASEAN 1967 Promoted economic
cooperation and
regional stability in SE
NAFTA 1994 North America FTA
USMCA 2020 US-Mexico-Canada FTA
 KEY INTERNATIONAL ECONOMIC INSTITUTIONS
No Org. YOE Purpose Functions
1 IMF 1944 To ensure the stability of the Surveillance of global
international monetary system economic trends, financial
by providing financial assistance, and capacity
assistance and policy advice to development
member countries
2 WB 1944 To provide financial and Funding infrastructure
technical assistance to projects, poverty reduction
developing countries for initiatives, and promoting
development projects sustainable development
3 WTO 1955 To regulate international trade Administering trade
and ensure smooth and fair agreements, resolving trade
trade between countries disputes, and monitoring
trade policies
4 OECD 1961 To promote policies that Economic research, policy
improve the economic and recommendations, fostering
social well-being of people economic cooperation among
around the world member countries
 KEY INTERNATIONAL ECONOMIC INSTITUTIONS
(cont)
No Org. YOE Purpose Functions
5 EEC 1957 To promote economic Single market, common
EU 1993 integration and political policies on trade, agriculture,
cooperation among European and regional development
countries

6 ASEAN 1967 To promote economic Economic cooperation, trade

growth, social progress, and agreements, and regional
regional stability in Southeast integration initiatives
Asia
7 BRIC 2009 To promote economic Economic collaboration,
BRICS 2010 cooperation and development development projects, and
among emerging economies policy coordination

8 NAFTA 1994 To eliminate trade barriers Trade agreements, economic

USMCA 2020 and promote economic cooperation, and dispute
integration among the US, resolution mechanisms
Canada, and Mexico
 GROUP DISCUSSION
Based on the 6 significant area IEIs have contributed to sustainable
development of global economy. You are requested to find concrete
national/international project on each of the following areas:
• Economic stability and growth
• Facilitation of international trade
• Development and poverty reduction
• Economic integration
• Policy coordination
• Capacity building

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Unit
AN OVERVIEW OF UNITED
2 NATIONS & ITS MISSIONS
HISTORICAL BACKGROUND
 CONTENTS

An overview of the United Nations and its missions

• Introduction to the United Nations
• Core objectives of the UN

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 INTRODUCTION
• Founded in 1945, after WWII to promote peace and prevent future conflicts
• A global organization with 193 member states
• Headquarter in New York city, USA
CORE OBJECTIVES of THE UN

• Maintain international peace

and security
• Promote human rights and
Social Justice
• Provide humanitarian aids
• Foster Global Cooperation for
sustainable development

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 STRUCTURE of THE UN
• General Assembly: all member states are represented, and
decisions on international issues are made
• Security Council: responsible for maintaining peace and security
within 15 members (5 permanent, 10 elected)
• International Court of Justice (ICJ): principle organ of the UN
• Secretariat: Administers UN operations, led by the UN
Secretary-General
• Economic & Social Council (ECOSOC): Coordinates
economics and social work
• UNICEF, UNESCO, WHO and other specialized agencies
 THE UN SECURITY COUNCIL

• Comprises of 15 members
• 5 permanent members: China, France, Russia, UK, US
• 10 elected members

• Responsible for resolving conflicts, imposing sanctions and

authorizing military interventions
• Decisions require the approval of at least 9 members, including
all 5 permanent members (with veto power)
 MILESTONES IN UN HISTORY
1941-1950 the Inter-Allied Declaration signed to establish the UN
1951-1960 appointed 2nd secretary, General Dag Hammarskjöld
(Sweden)
1961-1970 UNSG Dag Hammarskjöld – Nobel Peace Prize winner
1971-1980 the General Assembly votes to seat representative of the
Republic of China
1981-1990 UNHCR (UN High Commission for refugees) – won the
Nobel Peace Prize

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 MILESTONES IN UN HISTORY

1991-2000 Angola finally cease-fire after 16-year civil war

2001-2010 UN & Secretary General Kofi Annan won Nobel Peace
Prize for “their efforts in favor of a better organized and
more peaceful world”
2011-2020 the Republic of South Sudan joined
2021-2030 Antonio Guterres is reappointed to 2nd term as UN
Secretary General

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 THE UN HUMANITARIAN WORK

• The UN provides aid during natural disasters, armed conflicts,

and health crises
• Agencies like the World Food Programme (WFP) and
UNHCR (UN Refugee Agency) are on the frontlines of
humanitarian relief
• The UN coordinates efforts to provide shelter, food, medicine,
and protection to vulnerable populations
SUSTAINABLE DEVELOPMENT GOALS
• The 2030 Agenda for
Sustainable Development
includes 17 goals to end poverty,
protect the planet, and ensure
prosperity for all
• Focus areas include health,
education, clean energy,
gender equality, and climate
action.
• Countries are working together
to achieve the SDGs by 2030
17 SDGs GOALS
 KEY CHALLENGES FACING THE UN

• Geopolitical Tensions: Conflicts between major powers often

hinder decision-making, especially in the Security Council

• Reforming the UN: Calls for reform, especially in the Security

Council, where the veto power of permanent members is seen as
outdated

• Funding and Resources: The UN faces financial constraints and

relies on member state contributions

• Global Coordination: Achieving consensus on global issues like

climate change and human rights can be challenging
THE FUTURE of THE UNITED NATIONS

• Increasing focus on climate change, human rights, and global

health crises
• Possible reforms to the Security Council and efforts to make the
UN more inclusive and efficient
• Continuing work towards the 2030 Sustainable Development
Goals
• The UN’s role in responding to global pandemics and regional
conflicts remains crucial
 CONCLUSION

• The United Nations plays a vital role in maintaining international

peace, promoting human rights, and fostering global development
• Despite challenges, it remains an essential platform for
international cooperation
• The future success of the UN will depend on collaboration,
reform, and adaptation to new global realities
 GROUP DISCUSSION

"The United Nations' Contribution to Economic Development":

1.General Impact:
1. How has the United Nations contributed to global economic
development since its inception?
2. What are some of the most significant economic development
programs initiated by the UN?
2.Sustainable Development Goals (SDGs):
1. How effective has the UN been in promoting and achieving
the Sustainable Development Goals (SDGs)?
2. Which SDGs have seen the most progress, and which ones are
lagging behind?
 GROUP DISCUSSION (cont.)
3.Role of UN Agencies:
1. How do specialized UN agencies like the United Nations
Development Programme (UNDP) and the United Nations
Conference on Trade and Development (UNCTAD)
contribute to economic development?
2. Can you provide examples of successful projects or initiatives
led by these agencies?
4.Challenges and Criticisms:
1. What are the main challenges the UN faces in its economic
development efforts?
2. How can the UN address criticisms regarding its economic
development strategies and implementation?
 GROUP DISCUSSION (cont.)
5. Regional Focus:
1. How has the UN's approach to economic development differed across various
regions (e.g., Africa, Asia, Latin America)?
2. What lessons can be learned from the UN's economic development initiatives in
different regions?
6. Partnerships and Collaboration:
1. How important are partnerships with other international organizations,
governments, and the private sector in the UN's economic development efforts?
2. Can you discuss any successful collaborations that have significantly advanced
economic development?
7. Future Directions:
1. What should be the UN's priorities for economic development in the next
decade?
2. How can the UN adapt its strategies to better address emerging global economic
challenges?
GROUP DISCUSSION_CASE STUDIES
1. UN investment case for tobacco control in Mongolia
2. Vietnam joint program on social protection
3. SDG good practices: A compilation of success stories and
lessons learned. Choose a success stories and lessons learned
from the following areas:
a. Africa
b. Asia-Pacific
c. Western Asia
d. Europe
e. North America
SDG Good Practices Publication 2020.pdf
Unit
3 THE WORLD BANK
 CONTENTS

• Introduction – Historical background

• WB functions & operations
• Key projects initiatives
• Impact & achievement
• Challenges & criticisms
• Future direction

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HISTORICAL BACKGROUND
• An international financial institution
• Provides loans and grants to the
governments of poorer countries
for the purpose of pursuing capital
projects
• Established in 1944 at Bretton Wood
Conference with 11,000 people and
188 country members (2017)
• Initial goals reconstruction of war-
torn Europe
• Expanded goals to focus on global
development and poverty reduction
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 THE WB MISSION & GOALS
Primary mission:
• Reduce poverty
• Support sustainable development for all countries
Key goals:
• To end extreme poverty by 2030
• To promote shared prosperity
• To provide loan for broader economic policy reforms
(builds roads, airports, power plants; improve school; fight
for HIV/AIDS; accelerates irrigation and water
distribution; modernize judicial system; develop private
sectors, etc.
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THE WB FUNCTIONS & OPERATIONS
Financial services:
• Low-interest loans
• Interest-free credits
• Grants
Advisory services:
• Policy advice
• Technical assistance
• Research & analysis

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 KEY PROJECT INITIATIVES
The following initiatives are part of the World Bank's Global
Challenge Programs (GCPs), which aim to tackle key development
problems with greater scale, speed, and impact
1. Forests for development, climate and biodiversity
2. Energy access and transition
3. Accelerating digitalization
4. Food and nutrition security
5. Enhanced Health Emergency Prevention, Preparedness, and
Response
6. Fast-track Water security and Climate adaptation

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 FOREST DEVELOPMENT, CLIMATE, and
BIODIVERSITY
Objective: Build a sustainable forest economy in critical forest biomes.
Focus: Promote sustainable forest management and biodiversity
conservation.
Key components:
(a) Improving governance by strengthening state regulations;
(b) Mobilizing financing by attracting large-scale investment, leveraging
public and private sector funds for forest conservation; and
(c) Innovative approaches in implementing new technologies and practices
for sustainable forest management; encouraging partnership between
governments, NGOs, and the private sector
Expected outcomes: Economic growth, climate resilience, biodiversity
protection

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 ENERGY ACCESS & TRANSITION
The initiative is part of the World Bank's broader efforts to support
sustainable development and combat climate change by ensuring that energy
systems are resilient, inclusive, and environmentally friendly
Objective: expand access, promote clean energy, enhance energy efficiency
Key component:
• Extend electricity grids to rural and underserved areas, upgrade existing
infrastructure
• Renewable energy projects, invest in solar, wind, hydro and others
• Energy storage solutions, battery storage technologies for grid stability
• Policy & regulatory support to governments, provide technical assistance
Expected outcomes:
• Increase energy access, reduce carbon emissions, economic development

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 ACCELERATING DIGITALIZATION
The aims are to bridge the digital divide and promote inclusive digital
transformation globally
Objective: expand digital access; promote digital inclusion
Key components:
• Broadband connectivity and Digital infrastructure: expand
affordable mobile broadband (3G/4G), fiber optic connections
especially undersea
• Digital skills and literacy: provide training programs (women &
girls); education initiatives

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 FOOD & NUTRITION SECURITY
Objective: Break the cycle of food and nutrition insecurity by 2030.
Focus:
a. Enhance all people have access to sufficient, safe and nutritious
food;
b. promote dietary diversity and nutrition education to combat
malnutrition;
c. build resilience by strengthen food systems to withstand shocks
(climate change, conflicts, and economic disruptions

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 FOOD & NUTRITION SECURITY
Key components:
• Short-term interventions includes social protection program
(expand social safety nets to provide immediate relief to vulnerable
populations) and emergency food assistance (provide food aid and
support to areas experiencing acute food insecurity)
• Long-term resilience in climate-smart Agriculture, boosting
productivity and market access
• Nutrition-smart strategies like Nutrition education and diverse food
production

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 FOOD & NUTRITION SECURITY
Examples of projects:
1. Honduras–Rural Competitiveness Project (COMRURAL II&III)
• Objective: generate entrepreneurship and employment
opportunities while promoting climate-conscious, nutrition-smart
strategies in agri-food value chain
• Impact: benefiting around 6,287 rural small-scale producers and
creating 6,678 new jobs
2. Honduras – Corredor Seco Food Security Project (PROSASUR)
• Eastern and Southern Africa – Food System Resilience Program

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ENHANCE HEALTH EMERGENT PREVENTION
Objective: Strengthen health systems resilience and multisectoral
preparedness and response to health emergencies
Focus: Eastern and Southern Africa
Key components
• Strengthening health systems in improving infrastructure and resources,
training and capacity building
• Multisectoral coordination in fostering collaboration between health,
agriculture, environmental sector, response plans
• Community engagement -> increasing public awareness and education,
promoting community-based surveillance and reporting
Funding and support
Project cost $474 million, partnered by WB, regional government, and local
communities
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WATER SECURITY & CLIMATE ADAPTATION
Objective: Enhance water security through sustainable management
and climate change impact for disaster risk reduction.
Funding & support: project costs $500 million; partners involve
WB, regional government, private sector and local communities
Key components
• Water resource management
• Climate adaptation strategies
• Community and stakeholder engagement
Expected outcomes
• Reliable access to clean water for all
• Reduced vulnerability to climate-related water risks
• Active participation in water management and conservation efforts
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 IMPACT HIGHLIGHTS

• Global Reach: Active in over 100 countries.

• Community Benefits: Enhanced quality of life for millions
through improved infrastructure and services
• Innovative Financing: Developed new financial instruments
to support sustainable development

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 KEY ACHIEVEMENTS
1.Project Funding:
1. Funded over 12,000 projects globally
2. Provided $45.9 billion in financial assistance to developing nations
2.Economic Development:
1. Supported infrastructure development, including schools, water, and electricity
2. Promoted long-term economic growth and poverty reduction
3.Health and Education:
1. Improved access to healthcare and education in underdeveloped regions
2. Implemented programs to fight diseases and improve public health
4.Environmental Protection:
1. Invested in sustainable development and climate resilience projects
2. Promoted nature-based solutions and environmental conservation

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 CHALLENGES & CRITICISM
Despite its significant contributions, the World Bank faces various
challenges and criticisms
Key Challenges
1. Representation and Governance
1. Under-representation of Developing Countries: Decision-making
power is often dominated by wealthier nations
2. Lack of Democratic Ownership: Criticisms about the influence of
powerful countries over the Bank's policies
2. Conditionality and Impact
1. Stringent Loan Conditions: Imposing economic policies that may
not align with the borrowing country's needs
2. Mixed Outcomes: Some projects have not achieved the intended
development goals
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 CHALLENGES & CRITICISM
3. Environmental and Social Concerns:
1. Environmental Impact: Projects sometimes lead to
environmental degradation
2. Social Displacement: Infrastructure projects can result in the
displacement of communities
4. Accountability and Transparency:
1. Insufficient Accountability: Limited mechanisms to hold the
Bank accountable for project failures
2. Transparency Issues: Calls for greater transparency in
decision-making processes

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 CRITICISMS

• Economic Model: Reliance on a growth-based model that

may not be sustainable

• Climate Change Response: Criticized for not doing enough

to address climate change

• Debt and Dependency: Concerns about increasing debt

burdens on developing countries

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FUTURE DIRECTION & CONCLUSION
Strategic Priorities:
• Climate change mitigation
• Digital transformation
• Inclusive growth
Conclusion
Ongoing Reforms: WB is working on addressing these
challenges through various reforms and initiatives.
Future Focus: Enhancing inclusivity, sustainability, and
accountability in its operations.

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Unit
4 THE INTERNATIONAL
MONETARY FUND
 UNIT 4 CONTENTS

• History of the IMF

• Purpose, objectives, and functions
• Financial assistance
• Governance
• Recent activities
• Conclusion

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 INTRODUCTION

• An international financial institution established in 1944

• Headquartered in Washington, D.C.
• Comprises 190 member countries
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 HISTORICAL BACKGROUND
• The IMF was originally created in 1945 as part of the Bretton Wood
Agreement (collapsed in 1970s)
• Attempted to encourage international financial cooperation by
introducing a system of convertible currencies at fixed exchange rate
• The dollar was redeemable for gold at $35 per ounce at that time
• The IMF also acted as a gatekeeper: Countries were not eligible for
membership in the International Bank for Reconstruction and
Development (IBRD)—a World Bank forerunner that the Bretton Woods
agreement created in order to fund the reconstruction of Europe after
World War II—unless they were members of the IMF
• After 1970s when Bretton Wood collapsed, the IMF has promoted the
system floating exchange rates, meaning that market forces determine
the value of currencies relative to one another.

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 PURPOSE & OBJECTIVES
Primary Goals:
• Promote international monetary cooperation.
• Facilitate international trade.
• Foster sustainable economic growth.
• Reduce poverty around the world

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 FUNCTIONS

Key Functions:
• Surveillance of global economy
• Financial assistance to member countries
• Technical assistance and training

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 GOVERNANCE
Structure:
• Board of Governors
• Executive Board
• Managing Director (currently Kristalina Georgieva)

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 MAIN ACTIVITIES
• Surveillance: collects massive amounts of data on national economies,
provides regularly updated economic forecasts at the national and
international levels (World Economic Outlook) including lengthy
discussions on the effect of fiscal, monetary, and trade policies on growth
prospects and financial stability
• Capacity building: provides technical assistance, training, and policy
advice to member countries through its capacity-building programs. These
programs include training in data collection and analysis, which feed into
the IMF's project of monitoring national and global economies
• Lending: makes loans to countries that are experiencing economic
distress to prevent or mitigate financial crises. Members contribute the
funds for this lending to a pool based on a quota system. In 2019, loan
resources in the amount of SDR 11.4 billion (SDR 0.4 billion above target)
were secured to support the IMF’s concessional lending activities into the
next decade
 RECENT ACTIVITIES
• Support during the COVID-19 pandemic.
• Assistance to countries facing economic crises.
• Efforts to address climate change and digital transformation

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 THE IMF vs. WORLD BANK
Fields IMF World bank
Purpose & functions Oversees the stability of the world's Aims to reduce poverty by providing
monetary system financial and technical assistance to
middle-income and low-income
countries
Focus areas Monetary stability Economic development
International trade Infrastructure projects (building
Economic growth schools, etc)
Employment Health & education improvement
Structure Single organization Comprises of 2 institutions
• International bank for
reconstruction and development
(IBRD)
• International development
association (IDA)
Operations Provides policy advice, financial Offers loans and grants for
assistance, technical support to development projects
member countries
Membership 189 member countries IBRD has 189 and IDA has 172
members
 CONCLUSION
• The IMF plays a crucial role in maintaining global
economic stability.
• It provides financial support and policy advice to its
member countries.
• Continues to adapt to global economic challenges
• IMF works to help reduce poverty, encourage trade, and
promote financial stability and economic growth around
the world by monitoring capacity building and providing
loans.
• The organization has still faced criticism for the possible
negative impacts of its structural adjustment programs

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 WORLD TRADE
Unit
5 ORGANIZATION
UNIT 5 CONTENTS
• Introduction, historical background
• Structure, operations, and
• Governance
• Roles in controlling global trade
• WTO dispute settlement practices
• Typical trade dispute cases
• Brazil-Canada aircraft dispute
• US-EU beef hormones dispute
• US-EU banana dispute
• US-EU Airbus-Boeing dispute
• US shrimp-turtle dispute
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 INTRODUCTION
Overview
• Established: January 1, 1995
• Headquarters: Geneva, Switzerland
• Members: 164 countries

Purpose
• Facilitates international trade: Ensures trade flows smoothly,
predictably, and freely
• Resolves trade disputes: Provides a platform for negotiating
trade agreements and settling disputes

Key Principles
• Non-discrimination: Equal treatment for all trading partners
• Transparency: Clear and predictable trade policies

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 INTRODUCTION
Functions
• Trade Negotiations: Facilitates negotiations to reduce trade
barriers (tariffs, quotas) and create new trade agreements
• Dispute Resolution: Provides a legal and institutional framework
for resolving trade disputes between member countries
• Implementation and Monitoring: Ensures member countries
adhere to WTO agreements and international trade policies
• Capacity Building: Support developing countries in trade policy
issues through technical assistance and training
• transparency: promotes transparency in trade policies and
practices among member countries

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 HISTORICAL BACKGROUND
Origins: The WTO was established on January 1, 1995,
replacing the General Agreement on Tariffs and Trade (GATT),
which had been in place since 1948
The GATT was created in the aftermath of World War II to
promote international trade by reducing tariffs and other trade
barriers
Formation: The WTO was formed during the Uruguay Round
(1986-1994) of GATT negotiations, which aimed to create a
more robust and comprehensive framework for international
trade. The Marrakesh Agreement, signed by 123 nations in
1994, officially established the WTO

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 STRUCTURE
• Ministerial Conference: The highest decision-making body,
composed of representatives from all member countries. It meets
at least once every two years
• General Council: Handles day-to-day operations and is
composed of representatives from all member countries. It meets
regularly in Geneva
• Dispute Settlement Body: A part of the General Council responsible for
resolving trade disputes
• Trade Policy Review Body: Reviews national trade policies and ensures
they align with WTO agreements

• Secretariat: Led by the Director-General, the Secretariat provides

administrative, professional, and technical support

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 OPERATIONS
• Trade Agreements: Manages over 60 global trade agreements
that cover goods, services, and intellectual property
• Dispute Settlement: Operates a dispute settlement system that
allows countries to resolve trade conflicts through a structured
legal process
• Capacity Building: Provides training and support to help
developing countries build their trade capacity

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 GOVERNANCE
• Decision-Making: Decisions are typically made by
consensus among all member countries
• Director-General: The head of the WTO Secretariat,
responsible for overseeing the organization's functions and
operations
• Committees and Councils: Various specialized committees
and councils handle specific trade issues, such as
agriculture, services, and intellectual property

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 KEY ROLES IN CONTROLLING GLOBAL TRADE

• Setting Trade Rules: Establishes and enforces rules for

international trade to ensure fair and predictable trading
conditions
• Promoting Trade Liberalization: Works to reduce trade
barriers and promote free trade among member countries
• Ensuring Fair Competition: Provides a platform for
negotiating trade agreements that aim to create a level
playing field for all member countries
• Supporting Development: Helps developing countries
integrate into the global trading system and benefit from
international trade

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WTO DISPUTE SETTLEMENT PRACTICES
The WTO has a structured process for resolving trade disputes among its
member countries. Here are the key practices involved
CONSULTATIONS
• Initial Step: When a member country believes another member is
violating WTO agreements, it can request consultations to discuss the
issue and seek a mutually agreed solution
• Duration: Consultations typically last for 60 days
PANEL PROCEEDINGS
• Request for Panel: If consultations fail, the complaining country can
request the establishment of a panel to examine the dispute
• Panel Formation: A panel of three to five experts is formed to hear the
case and make findings
• Panel Report: The panel issues a report with its findings and
 WTO DISPUTE SETTLEMENT PRACTICES
APPEALS
• Appellate Body: Either party can appeal the panel's decision to the WTO
Appellate Body, which consists of seven members
• Review Process: The Appellate Body reviews the panel's findings and can
uphold, modify, or reverse them
• Final Report: The Appellate Body issues a final report, which is adopted
by the Dispute Settlement Body (DSB) unless there is a consensus against it
IMPLEMENTATION AND COMPLIANCE
• Adoption of Reports: Once the DSB adopts the panel or Appellate Body
report, the losing party must comply with the recommendations
• Reasonable Period: The losing party is given a reasonable period to
implement the recommendations
• Surveillance: The DSB monitors the implementation of rulings and
recommendations
WTO DISPUTE SETTLEMENT PRACTICES
RETALIATION AND COMPENSATION
• Compensation: If the losing party fails to comply, the winning party
can seek compensation
• Retaliation: If compensation is not agreed upon, the winning party can
request authorization from the DSB to impose retaliatory measures, such
as trade sanctions
KEY PRINCIPLES
• Non-discrimination: Ensures equal treatment for all member countries
• Transparency: Promotes clear and predictable trade policies
• Rule-based System: Provides a structured and legal framework for
resolving disputes
These practices help maintain stability and predictability in international
trade by ensuring that disputes are resolved fairly and transparently.
 NOTABLE TRADE DISPUTES
1. Brazil-Canada Aircraft Dispute
• Issue: Brazil and Canada accused each other of providing illegal
subsidies to their respective aircraft manufacturers, Embraer and
Bombardier.
• Outcome: The WTO ruled that both countries had provided
prohibited subsidies and required them to withdraw these subsidies
2. US-EU Beef Hormones Dispute
• Issue: The European Union banned the import of beef treated with
certain growth hormones, which the United States argued was not
based on scientific evidence.
• Outcome: The WTO ruled in favor of the US, stating that the EU's
ban was inconsistent with WTO rules. The EU was required to lift
the ban or face retaliatory tariffs
 NOTABLE TRADE DISPUTES
3. US-EU Banana Dispute
• Issue: The United States challenged the European Union's banana
import regime, which favored imports from former European
colonies in the Caribbean over Latin American countries.
• Outcome: The WTO ruled that the EU's import regime was
discriminatory and required the EU to change its policies
4. US-EU Airbus-Boeing Dispute
• Issue: The United States and the European Union accused each
other of providing illegal subsidies to their respective aircraft
manufacturers, Boeing and Airbus.
• Outcome: The WTO found that both the US and the EU had
provided illegal subsidies and authorized each to impose
retaliatory tariffs on the other's goods
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 NOTABLE TRADE DISPUTES
5. US Shrimp-Turtle Dispute
• Issue: The United States imposed a ban on shrimp imports
from countries that did not use turtle-excluder devices in
their fishing nets, arguing it was necessary to protect
endangered sea turtles.
• Outcome: The WTO ruled that while the US could take
measures to protect sea turtles, the way it implemented the
ban was discriminatory and inconsistent with WTO rules
These cases illustrate the WTO's role in resolving complex
trade disputes and ensuring that international trade rules are
followed.

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 RECENT WTO WORK ON TRADE &
ENVIRONMENT
A growing number of WTO members recognize this reality.
• An increase in the level of engagement in the Committee on Trade and
Environment, a unique forum dedicated to enhancing our dialogue on
trade and environment issues.
• As a result, the rise of coalitions around specific environmental topics
such as the circular economy, plastic pollution, fossil fuel subsidy reform
and clean technologies.
• Trade policies have a huge potential to support sustainability.
• The current crisis calls for a collective response on trade that fosters
sustainability, inclusiveness and resilience.
The WTO Secretariat is here to support WTO members in their search for
flexible, creative and pragmatic solutions.

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 CONCLUSION
The future directions of the World Trade Organization (WTO) are
shaped by several key trends and challenges

1. Emphasis on Digital Trade

Digital Economy: The WTO is increasingly focusing on rules
and frameworks to facilitate digital trade, recognizing the
growing importance of e-commerce and digital services in the
global economy
2. Green Trade Initiatives
Sustainability: There is a strong push towards integrating
environmental sustainability into trade policies. This includes
addressing issues like climate change, promoting green
technologies, and reducing carbon footprints in trade practices
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 CONCLUSION
3. Inclusivity and Development
Inclusive Growth: The WTO aims to ensure that the benefits of global
trade are more evenly distributed. This involves supporting developing
countries and small businesses to participate more effectively in
international trade
4. Plurilateral Agreements
Flexible Negotiations: Given the challenges of achieving consensus among
all members, the WTO is exploring plurilateral agreements. These involve a
subset of members agreeing on specific trade issues, which can then be
extended to other members
5. Reforming Dispute Settlement
Dispute Resolution: There is a need to reform the WTO's dispute
settlement mechanism, particularly the Appellate Body, to ensure it remains
effective and credible. This includes addressing concerns about procedural
shortcomings and ensuring timely resolution of disputes3
 CONCLUSION
6. Addressing Trade Fragmentation-Global Cooperation
The WTO is working to prevent the fragmentation of the global
trading system into competing blocs. This involves promoting
cooperation and dialogue among major trading nations to
maintain a unified and open global trade environment
7. Enhancing Transparence-Policy Monitoring:
Improving transparency in trade policies and practices remains a
priority. This helps build trust among members and ensures that
trade rules are followed consistently
These directions highlight the WTO's commitment to adapting to
new global trade realities while maintaining its core principles of
promoting free and fair trade.

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 WTO-GATT AGREEMENT
The General Agreement on Tariffs and Trade (GATT) and the WTO are
closely linked, with GATT serving as a precursor to the WTO.
GENERAL AGREEMENT ON TARIFFS AND TRADE (GATT)
Background
• Established in 1947, came into force in 1948
• Purpose: To promote international trade by reducing or eliminating trade
barriers such as tariffs and quotas
• Initial Signatories: 23 countries
Key Features
• Rounds of Negotiations: GATT was updated through a series of trade
negotiation rounds, the most significant being the Uruguay Round (1986-1994)
• Principles: Non-discrimination (Most-Favored-Nation principle), transparency,
and the promotion of fair competition
• Impact:
• Tariff Reductions: Successfully reduced average tariff levels from about 22%
in 1947 to around 5% by the end of the Uruguay Round
• Trade Expansion: Facilitated significant growth in international trade and
economic cooperation
 WTO-GATT AGREEMENT
WORLD TRADE ORGANIZATION (WTO)
Background:
• Established: January 1, 1995, as a result of the Uruguay Round negotiations
• Purpose: To provide a common institutional framework for the conduct of
international trade relations
Key Features:
• Broader Scope: Unlike GATT, which focused mainly on goods, the WTO
covers trade in services (GATS), intellectual property rights (TRIPS), and trade-
related investment measures (TRIMS)
• Dispute Settlement: The WTO has a more robust and binding dispute
settlement mechanism compared to GATT
Impact:
• Global Trade Governance: The WTO plays a central role in global trade
governance, setting rules and resolving disputes among member countries
• Membership: As of now, the WTO has 164 member countries, representing
over 98% of global trade
 WTO-GATT AGREEMENT
TRANSITION FROM GATT to WTO
• GATT 1994: The original GATT text (GATT 1947) was
incorporated into the WTO framework as GATT 1994, with
modifications
• Institutional Changes: The WTO provided a more
comprehensive and permanent institutional structure compared
to the provisional nature of GATTThe transition from GATT to
the WTO marked a significant evolution in the global trade
system, enhancing the scope and effectiveness of international
trade rules and dispute resolution
 WTO-GATS AGREEMENT
• The General Agreement on Trade in Services (GATS) is a
treaty of the World Trade Organization (WTO) that came into
effect in January 1995.
• It was established during the Uruguay Round negotiations to
extend the multilateral trading system to the service sector,
similar to how the General Agreement on Tariffs and Trade
(GATT) applies to merchandise trade

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 WTO-GATS AGREEMENT
Main objectives of GATS are to:
• Promote trade in services by creating a stable and transparent
trading environment.
• Encourage economic growth and development, particularly
in developing countries.
• Progressively liberalize trade in services through successive
rounds of negotiations

GATS covers a wide range of services, including financial

services, telecommunications, and tourism. It operates on the
principle of Most-Favoured-Nation (MFN) treatment, meaning
that WTO members must treat services and service suppliers
from all other members equally

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 WTO-TRIMS AGREEMENT
TRIMS is a WTO agreement that sets rules on investment measures
related to trade in goods.
TRIMS have significant implications for developing countries, both
positive and challenging
Key Objectives
• Eliminate trade-distorting investment measures
• Ensure fair competition and market access
Positive implications:
• Developing countries can attract more FDI, lead to economic growth and
job creation
• Improve access to global market to enhance export opportunities for
developing countries
Prohibited Measures
• Local content requirements
• Trade balancing requirements
• Export performance requirements
 WTO-TRIMS AGREEMENT
Implementation and Transition Periods
• Developed countries: 2 years
• Developing countries: 5 years
• Least-developed countries: 7 years
Impact on Trade and Investment
• Promotes foreign direct investment
• Reduces barriers to international trade
Challenges and Criticisms
• Compliance issues in developing countries: costs, legal
changes
• Balancing national interests with global rules
• Loss of policy flexibility since restrictions on certain
investment measures may limit the ability of developing
countries to use policies that promote local industries

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 WTO-TRIPS AGREEMENT
• Agreement on Trade-Related Aspects of Intellectual Property Rights
(TRIPS) aiming to protecting Intellectual Property Globally
• TRIPS is a WTO agreement that sets minimum standards for
intellectual property (IP) regulation, came into force on January 1,
1995
Key Objectives
• Protect and enforce IP rights
• Promote technological innovation and transfer
Key Provisions
• Copyrights and related rights
• Trademarks and geographical indications
• Patents and industrial designs

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 WTO-TRIPS AGREEMENT
Positive Implications:
• Technology Transfer: TRIPS includes provisions that encourage technology
transfer from developed to developing countries, potentially enhancing their
technological capabilities
• Innovation and Investment: Stronger intellectual property rights (IPR)
protection can stimulate innovation and attract investment in research and
development
Challenges:
• Access to Medicines: Stringent IPR protections can make essential medicines
more expensive and less accessible in developing countries. However,
flexibilities like compulsory licensing can help mitigate this issue
• Implementation Costs: Developing countries may face significant costs in
updating their legal and administrative frameworks to comply with TRIPS
Balancing Interests:
• Ensuring that IPR protection does not hinder public health, education, and other
development goals can be challenging
• Developing countries can leverage the flexibilities within these agreements and
seek support from international organizations to address these challenges
 WTO-TRIPS AGREEMENT
Implementation and Compliance
• Developed countries: Immediate compliance
• Developing countries: Transition periods
• Least-developed countries: Extended transition periods
Impact on Global Trade
• Encourages innovation and creativity.
• Facilitates international trade and investment.
Challenges and Criticisms
• Access to medicines in developing countries.
• Balancing IP protection with public health
Summary
• TRIPS aims to harmonize IP laws globally and support economic
development.

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VIETNAM’s WTO ACCESSION PROCESS
Vietnam's accession to the World Trade Organization (WTO) was a
significant milestone in its economic development and integration
into the global economy. Here is an overview of the process:

Timeline and Key Steps

1. Application and Negotiations:
• Vietnam applied for WTO membership in 1995
• The negotiation process involved bilateral and multilateral discussions with
existing WTO members to align Vietnam's trade policies with WTO rules
2. Domestic Reforms:
• Vietnam undertook extensive domestic reforms to meet WTO requirements,
including changes in trade policies, legal frameworks, and economic
regulations
• These reforms aimed to enhance transparency, increase economic freedoms,
and observe the rule of law

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 VIETNAM’s WTO ACCESSION PROCESS
Accession Agreement:
• In 2006, Vietnam concluded its negotiations and signed the accession
agreement.
• The agreement outlined commitments to reduce tariffs, eliminate trade
barriers, and open up various sectors to foreign competition
Membership
Vietnam officially became the 150th member of the WTO on January 11, 2007

Implications for Vietnam

Positive Implications:
• Market Access: Gained greater access to international markets, boosting
exports and economic growth
• Foreign Investment: Attracted higher levels of foreign direct investment due
to improved trade policies and economic stability
• Economic Reforms: Accelerated domestic reforms, leading to a more market-
oriented economy

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 VIETNAM’s WTO ACCESSION PROCESS
Challenges
• Compliance Costs: Implementing WTO rules required significant adjustments
and investments in legal and regulatory frameworks
• Competition: Increased competition from foreign companies posed challenges
for local businesses

Vietnam's WTO accession has played a crucial role in its economic

transformation, contributing to sustained growth and development

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VIETNAM’s COMMITMENT to WTO AGREEMENT
Vietnam made several key commitments to join the World Trade
Organization (WTO), focusing on both goods and services. Here are
the main commitments:
COMMITMENTS ON GOODS
1. Tariff Reductions:
• Vietnam agreed to reduce tariffs on a wide range of products, including
agricultural and industrial goods
• The average tariff rate was significantly lowered to facilitate easier market
access for foreign goods
2. Elimination of Non-Tariff Barriers:
• Vietnam committed to eliminating various non-tariff barriers, such as quotas
and import bans
• This included removing restrictions on the importation of certain goods and
simplifying customs procedures

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VIETNAM’s COMMITMENT to WTO AGREEMENT
COMMITMENTS ON SERVICES
1. Market Access:
1. Vietnam opened up several service sectors to foreign competition,
including banking, insurance, telecommunications, and distribution2
2. Foreign service providers were allowed to establish joint ventures and, in
some cases, wholly foreign-owned enterprises
2. Investment Conditions:
1. Vietnam agreed to provide national treatment to foreign investors,
ensuring they receive the same treatment as domestic investors
2. Specific commitments were made regarding the forms of investment
allowed, such as business cooperation contracts and joint ventures
TRIPS COMPLIANCE: Intellectual Property Rights (IPR)
• Vietnam committed to fully implementing the WTO's Agreement on Trade-
Related Aspects of Intellectual Property Rights (TRIPS)
• This included strengthening the protection and enforcement of intellectual
property rights
VIETNAM’s COMMITMENT to WTO AGREEMENT
TRANSPARENCY AND LEGAL REFORMS
1.Regulatory Transparency:
• Vietnam agreed to enhance transparency in its trade and investment policies
• This involved publishing laws and regulations and providing opportunities
for public comment
2.Legal Reforms:
• Significant legal and regulatory reforms were undertaken to align with WTO
rules and standards
• These reforms aimed to create a more predictable and stable business
environment
These commitments have helped Vietnam integrate more deeply
into the global economy, attracting foreign investment and boosting
trade
VIETNAM’s CHALLENGES in WTO POLICY COMPLIANCE

1. Anti-Dumping Measures
Steel Products: Vietnam has faced anti-dumping investigations and
measures from other WTO members, particularly concerning steel
products. For example, the United States and the European Union
have imposed anti-dumping duties on certain Vietnamese steel
products
2. Intellectual Property Rights (IPR)
Enforcement Issues: Vietnam has been criticized for inadequate
enforcement of intellectual property rights, which is a requirement
under the TRIPS Agreement. Issues include piracy of software,
music, and movies
VIETNAM’s CHALLENGES in WTO POLICY COMPLIANCE

3. Agricultural Subsidies
Rice Export Subsidies: There have been concerns about Vietnam's
subsidies for rice exports, which could potentially distort
international trade and violate WTO rules on agricultural subsidies
4. Trade Barriers
Import Restrictions: Vietnam has been reported to maintain certain
import restrictions that could be seen as non-tariff barriers, affecting
the free flow of goods as required by WTO agreements
VIETNAM’s CHALLENGES in WTO POLICY COMPLIANCE

5. Transparency and Regulatory Practices

Regulatory Transparency: There have been instances where
Vietnam's regulatory practices have been questioned for lack of
transparency, which is a key principle of the WTO
6. Dispute Settlement Cases
WTO Disputes: Vietnam has been involved in several disputes at
the WTO, both as a complainant and as a respondent. These cases
often involve complex issues of trade compliance and interpretation
of WTO rules
Vietnam continues to work on aligning its policies and practices
with WTO requirements, and these efforts are part of its broader
strategy to integrate more deeply into the global economy.
 GROUP DISCUSSION & PRESENTATION
1. When joining the WTO, Vietnam has endured the long time for
application, assessment and approval process. Describe Vietnam’s
accession process to become WTO member.
2. What are the international institutions of GATT and GATS. Is there
any differences between the twos?
3. What are Vietnam’s commitment when signing the membership
agreement with World Trade Organization?
4. What is TRIMS agreement and its implications for WTO member
countries?
5. What is TRIPS agreement and its implications for WTO member
states?
6. What is the accusation between the United States and the European
Union, the giant aircraft manufacturers Boeing and Airbus?

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 GROUP DISCUSSION & PRESENTATION
7. Vietnam, like many other countries, has faced challenges in
fully complying with WTO policies. Tracking some notable
instances where Vietnam has been involved in disputes or faced
issues related to WTO compliance?
8. World bank and IMF has joined together in helping countries in
need of many food security, water security, and climate
challenges. Tracking some notable WB-IMF collaborated
projects that address one of those issue?

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Unit
REGIONAL ECONOMIC
6 ORGANIZATIONS
 UNIT 6 – CONTENTS
• Introduction Regional Economic Organizations
• The EU - European Union
• ASEAN - Association of Southeast Asian Nations
• NAFTA - North American Free Trade Area
• African Union
• EAFTA – Eurasian Economic union

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 INTRODUCTION
• Regional economic institutions formed by countries within a specific
geographic area to promote economic cooperation, trade, and
development among member states.
• These institutions aim to enhance regional integration, reduce trade
barriers, and facilitate investment, leading to economic growth and
stability in the region.
• Some well-known examples of regional economic institutions include:
• European Union (EU)
• Association of Southeast Asian Nations (ASEAN)
• North American Agreement (NAFTA)
• African Economic Union
• Eurasian Economic Union

• These institutions play a critical role in addressing regional challenges and can
serve as platforms for collective decision-making and policy coordination
• They help improve market efficiency, share the costs of public goods or large
infrastructure projects, and promote peace and security

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 EUROPEAN UNION
• A political and economic union of 27 European countries that are
located primarily in Europe
• Established to promote peace, stability, and economic cooperation
• Key objectives
• Economic integration: single market allowing free movement of goods, services,
capital, and people
• Political cooperation: Common policies on various issues like agriculture,
fisheries, and regional development
• Social and environmental goals: Promoting social inclusion, environmental
sustainability, and human rights

• Major institutions
• European Commission: Proposes legislation and implements decisions
• European Parliament: Elected body representing EU citizens
• Council of the European Union: Represents member states' governments

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 EUROPEAN UNION
• Achievements
• Euro currency: Common currency used by 19 member countries
• Schengen area: Allows passport-free travel across many EU countries
• Trade agreements: numerous trade agreements with countries around the
world
• Challenges
• Brexit: the UK’s departure from the EU
• Economic disparities: Differences in economic development among
member state
• Migration and security: managing migration flow and ensuring security
• Future prospects
• Continued integration and addressing global challenges

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ASSOCIATION of SE ASIAN NATIONS
• ASEAN, the regional intergovernmental organization comprising
ten Southeast Asian countries (Brunei, Cambodia, Indonesia, Laos,
Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam)
• Established in 1967 in Bangkok, Thailand
• Key objectives:
• Promote political and security cooperation,
• Stimulate economic growth, social progress, and cultural development.
• Foster regional peace and stability.
• Enhance collaboration and mutual assistance on matters of common interest.
• Major institutions:
• ASEAN summit: the supreme policy-making body
• ASEAN Secretariat: coordinates and implement ASEAN activities
• ASEAN regional forum (ARF): focusses on security and political issues

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• Economic integration
• Aims to create a single market and production base
• Free flow of goods, services, investment, skilled labor, and capital
• Social and cultural cooperation => Asean Social-Cultural Community
(ASCC)
• Promotes social development and environmental sustainability
• Focuses on education, health, and disaster management
• Achievements:
• Significant economic growth and development
• Establishment of the ASEAN free trade area – AFTA
• Enhanced regional connectivity and infrastructure
• Challenges:
• Economic disparities among member countries
• Political and security issues
• Environmental sustainability and climate change
• Future prospects
• Strengthening regional integration
• Addressing global challenges collectively
• Enhancing ASEAN’s role in the international community
NORTH AMERICAN FREE TRADE AREA
NAFTA: An agreement among the United States, Canada, and
Mexico designed to remove tariff barriers between the three
countries
• Established in 1994 by the United States, Canada and Mexico
• Goals: eliminate trade barriers, promote economic cooperation
• Trade liberalization: removal all tariffs, rule or origin required
• Side agreements: labor and environmental standards
• Impact of NAFTA
• Economic growth: increase trade volume among member
countries; job creation and economic integration
• Challenges: job looses in certain sectors
• Environmental concerns

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 NAFTA TRANSITION to USMCA
• Reason for renegotiation: modernize the agreement and address
trade imbalances
• Key changes: stricter rules of origin for automobile; labor and
environmental protections; digital trade provisions
• Key features of USMCA
• Automobile industry: higher regional content requirements
• Labor rights: stronger labor standards and enforcement
• Environmental protections: enhance environmental
commitments
• Digital trade: new rules for digital commerce and data
protection

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 NAFTA TRANSITION to USMCA
• Economic impacts of USMCA
• Positive outcomes:
• Increase trade and investment
• Job creation in certain sectors
• Negative outcomes
• Adjustment costs for industries
• Enforcement of new standards
• Conclusion
• NAFTA’s legacy and achievements
• USMCA’s improvements and future prospects
=> Importance of continuous evaluation and adaptation in trade
agreements

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 AFRICAN UNION
• AU is a continental union consisting of 55 member states located in
Africa, established in 2002.
• Main objectives are promote unity and solidity among African
countries; spur economic development and integration; promote peace,
security, and stability on the continent
• Key organs of AU:
• Assembly of the African Union: composed of heads of state and
government
• African Union Commission: the secretariat, based in Addis Abaha
• Pan-African Parliament: legislative body
• Key initiatives:
• Agenda 2063: A strategic framework for the socio-economic
transformation of the continent
• African continental Free Trade Area (AfCTA) aims to create a single
market for goods and services
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 AFRICAN UNION
• Notable achievements
• Successful mediation in conflicts (Sudan, Somalia)
• Progress in economic integration and infrastructure development
• Current challenges
• Political instability in some member states
• Economic disparities and development gaps
• Health crises and pandemics
• Future prospects
• Continue efforts towards greater unity and economic integration
• Focus on sustainable development and climate resilience
AU play a crucial role in fostering unity, peace and development across
Africa; the union’s ongoing efforts and initiatives aim to address challenges
and build a prosperous future for the continent

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 EURASIAN ECONOMIC UNION
• An economic union of five post-Soviet states located in Eurasia
established on January 1, 2015
• Member states includes Armenia, Belarus, Kazakhstan,
Kyrgyztan, and Russia
• Objectives: promote economic cooperation and integration and
establish a single market for goods, services, capital and labor
• Key features are unified customs relations and tariffs; coordinate
economic policies in various sectors, free movements of goods,
services, capital and labor within the union
• Governance comprises of a) Supreme Eurasian Economic
Council (decision making body); Eurasia Economic Commission
(executives of policy implementation); and Court of EAEU
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 EURASIAN ECONOMIC UNION
• Economic impacts: >$2.4 trillion in 2023arr
• International relations: various trade agreements with on-
member countries; strategic partnerships with other international
organizations
• Current challenges:
• Economic disparity among member states
• Non-tarrif barriers
• Ongoing geographical tensions (Russia-Ukraine conflicts) affect the stability and
attractiveness of the EAEU
• Future prospects:
• Ongoing efforts to deepen economic integration
• Expansion of EAEU network of free trade agreements with non-members
• Increase cooperation in technology and innovation to boost economic growth and
competitiveness

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EU-ASEAN FREE TRADE AGREEMENT
• Introduction
• Concept: proposed free trade agreement between EU and ASEAN
• Objectives: enhance economic integration and cooperation between EU and
ASEAN nations
• Member countries
• EU: 27 member states and ASEAN: 11 member states including Vietnam
• Key features
• Reduction of tariffs and non-tariff barriers
• Collaboration in various sectors such as technology, infrastructure, and services
• Encouraging cross-border investments and protecting investors’ rights
• Benefits
• Economic growth through increased trade and investment
• Provide wider market access for goods and services
• Promote regional stability through economic interdependence

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EU-ASEAN FREE TRADE AGREEMENT
• Challenges
• economic disparities among member countries
• Harmonizing regulations and standards across diverse economies
• Managing geopolitical tensions that may affect economic cooperation
• Future prospects
• Expansion potential inclusion of more countries in the future
• Further integration in areas like digital economy and sustainable
cooperation
• Strenthening the region’s influence in global trade and economic policies

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Unit
ASEAN & AEC ECONOMIC
7 COMMUNITY
 UNIT 7 – COURSE OVERVIEW

• Overview on ASEAN economic community: AFTA

and AEC
• The concept of AEC and their significance in the
global economy
• Key institutions
• The participation of Vietnam

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 INTRODUCTION AEC
The ASEAN Economic Community (AEC) is an initiative by the
Association of Southeast Asian Nations (ASEAN)
• Established: December 31, 2015
• Member States: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar,
Philippines, Singapore, Thailand, Vietnam
Objectives
• Single Market: Create a single market and production base.
• Economic Integration: Enhance economic integration and cooperation among
member states.
• Equitable Development: Promote equitable economic development across the
region
Key Features
• Free Movement: Free movement of goods, services, investment, capital, and
skilled labor.
• Trade Facilitation: Simplified customs procedures and harmonized trade
regulations.
• Investment Promotion: Encouraging cross-border investments and protecting
investors' rights
Benefits
• Economic Growth: Boosts economic growth through increased trade and
investment.
• Market Access: Provides wider market access for goods and services.
• Regional Stability: Promotes regional stability through economic
interdependence
Challenges
• Economic Disparities: Addressing economic disparities among member
countries.
• Regulatory Harmonization: Harmonizing regulations and standards across
diverse economies.
• Geopolitical Tensions: Managing geopolitical tensions that may affect
economic cooperation.
Future Prospects
• Deeper Integration: Further integration in areas like digital economy and
sustainable development.
• Global Influence: Strengthening the region's influence in global trade and
economic policies.
• Innovation and Competitiveness: Enhancing innovation and competitiveness
to drive economic growth
 AFTA
Overview of AFTA
• Established in 1992
• Aiming to create a single market and production base
• Mechanism: Common Effective Preferential Tariff (CEPT)
Scheme
Economic Goals
• Increase ASEAN's competitiveness
• Attract foreign direct investments
• Expand intra-ASEAN trade
Tariff Reduction
• Elimination of tariffs on intra-ASEAN trade
Rules of Origin
• Products must have 40% ASEAN content

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 AFTA
Trade Facilitation
• Simplification of customs procedures
Economic Growth
• Increase in trade volume among member countries
• Enhanced regional economic integration
Challenges
• Disparities in economic development among members
• Non-tariff barriers

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 VIETNAM-AEC RELATIONS
Vietnam has played a significant role in the ASEAN Economic
Community (AEC) and has benefited from its integration into this
regional economic bloc. Here are some key details about Vietnam's
relations with the AEC:
Economic Integration
• Trade Growth: Since joining ASEAN in 1995, Vietnam's trade with ASEAN
countries has grown significantly. The two-way trade value between Vietnam
and ASEAN increased from USD 3.3 billion in 1995 to USD 42.1 billion in
2015
• ASEAN is now one of Vietnam's top trading partners.
Exports and Imports
• Vietnam's exports to ASEAN have diversified over the years, including
products like cell phones, electronics, machinery, footwear, and garments.
Imports from ASEAN have also grown, making ASEAN Vietnam’s 3rd
largest supplier of goods.
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 VIETNAM-AEC RELATIONS
Investment Relations
• Foreign Direct Investment (FDI): ASEAN is a major source of FDI
for Vietnam, with significant investments from countries like
Singapore, Malaysia, and Thailand. These investments have
contributed to Vietnam's economic development and industrialization
• Vietnamese Investments: Vietnam also invests in other ASEAN
countries, strengthening economic ties within the region
Challenges
• Trade Deficit: Vietnam runs a trade deficit with ASEAN, importing
more than it exports to the region
• Economic Disparities: Addressing economic disparities among
ASEAN member states remains a challenge for deeper integration

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 VIETNAM-AEC RELATIONS
Future Prospects
• Economic Growth: Continued integration with the AEC is expected to
boost Vietnam's economic growth through increased trade and
investment opportunities
• Regional Stability: Vietnam's active participation in ASEAN
initiatives contributes to regional stability and economic cooperation

Vietnam's engagement with the AEC has been a crucial part of its
economic strategy, helping to enhance its global economic standing
and regional influence.

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NOTABLE PROJECT CASES VIETNAM-AEC

Here are some notable project cases involving Vietnam and the
ASEAN Economic Community (AEC):
1. ASEAN Power Grid (APG)
2. ASEAN Highway Network (AHN)
3. ASEAN Single Window (ASW)
4. ASEAN Smart Cities Network (ASCN)
5. ASEAN Tourism Strategic Plan (ATSP)
These projects highlight Vietnam's active engagement in ASEAN
initiatives, contributing to regional integration and development.

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 ASEAN POWER GRID-APG
1. ASEAN Power Grid (APG)
• Objective: Enhance energy security and connectivity
among ASEAN member states.
• Vietnam's Role: Vietnam is actively participating in the
ASEAN Power Grid project, which aims to integrate the
power systems of ASEAN countries to ensure a reliable and
sustainable energy supply
• Impact: This project helps Vietnam improve its energy
infrastructure and promotes regional energy cooperation.

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ASEAN HIGHWAY NETWORK-AHN
2. ASEAN Highway Network (AHN)
• Objective: Develop a comprehensive road network to
facilitate trade and transportation across ASEAN.
• Vietnam's Role: Vietnam is a key participant in the AHN,
contributing to the development of major highways that
connect with neighboring countries
• Impact: Enhances Vietnam's connectivity with other ASEAN
countries, boosting trade and economic integration.

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 ASEAN SINGLE WINDOW-ASW
3. ASEAN Single Window (ASW)
• Objective: Simplify and harmonize customs procedures to
facilitate trade within ASEAN.
• Vietnam's Role: Vietnam has implemented the ASEAN
Single Window system, which allows for the electronic
exchange of trade-related documents
• Impact: Reduces trade barriers, speeds up customs
clearance, and lowers costs for businesses.

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ASEAN SMART CITY NETWORK-ASCN
4. ASEAN Smart Cities Network (ASCN)
• Objective: Promote sustainable urban development through
smart city initiatives.
• Vietnam's Role: Cities like Hanoi, Ho Chi Minh City, and
Da Nang are part of the ASCN, focusing on projects related
to smart infrastructure, digital governance, and sustainable
urban planning
• Impact: Enhances urban living standards and promotes
sustainable development in Vietnamese cities.

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ASEAN SMART CITY NETWORK-ASCN
5. ASEAN Tourism Strategic Plan (ATSP)
• Objective: Boost tourism cooperation and development
among ASEAN countries.
• Vietnam's Role: Vietnam actively participates in the ATSP,
promoting its tourism destinations and collaborating on
regional tourism initiatives.
• Impact: Increases tourist arrivals, enhances cultural
exchange, and boosts the tourism sector's contribution to the
economy.

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