Ha Noi eyes top-five ranking in FTA Index

Nguyen The Hiep, Deputy Director of the Ha Noi Department of Industry and Trade, said the capital placed 30th out of 63 provinces and cities in the 2024 FTA Index.

Over the past year, the department, in coordination with the Ministry of Industry and Trade's Multilateral Trade Policy Department, has held workshops and training programs to help enterprises better understand and apply the FTA Index criteria.

Ha Noi has rolled out tailored support for key export sectors and initiatives aimed at helping businesses tap into high-potential markets. The city's action plan prioritizes strengthening FTA information dissemination, updating the legal framework, supporting exporters, improving competitiveness, and promoting sustainable development. Efforts also focus on easing barriers to green transition and digital transformation, and helping businesses meet international standards.

Enterprises are encouraged to diversify export markets, make full use of FTA tariff preferences, and reduce dependence on imported inputs to satisfy rules-of-origin requirements—key to preventing trade fraud and avoiding tariff circumvention risks.

"Our goal is to improve every component of the FTA Index by supporting exporters, enhancing competitiveness, and enabling Ha Noi's key industries to integrate into global supply chains," Hiep said.

Mac Quoc Anh, Vice Chairman and Secretary General of the Ha Noi Association of Small and Medium Enterprises (HA NOISME), stressed that raising awareness of FTAs and improving administrative procedures and logistics efficiency are essential. Advancing the green transition alone could raise FTA utilization by 10 percent and boost export turnover by 10–20 percent, he noted.

To support this, Anh proposed establishing an FTA Center in Ha Noi to serve as a coordination and advisory hub connecting the Ministry of Industry and Trade, customs authorities, and enterprises. The FTA Index, he added, goes beyond traditional trade performance and includes non-tariff criteria such as the circular economy, ESG practices, labor standards, environmental protection, and carbon regulations.

However, awareness remains low: only 32 percent of HA NOISME members fully understand rules of origin, fewer than 25 percent use FTA incentives, and just 18% have carbon reduction plans—requirements that will become mandatory for exports to the EU from 2026–2027. Without timely adaptation, businesses risk losing 5–8 percent of their profits annually.

The proposed FTA Center aims to increase the share of enterprises benefiting from FTA preferences from the current 32 percent to 55 percent by 2026.

Nguyen Van Than, Chairman of the Vietnam Association of Small and Medium Enterprises, said SMEs—representing 97 percent of Viet Nam's businesses—still lack the capacity to fully leverage FTAs. Many continue to focus on subcontracting rather than producing high-standard goods for demanding markets such as the EU, US, and Canada.

He emphasized the need for a shift in business mindset. "Enterprises must become professional producers and traders to seize integration opportunities," he said, calling for more diverse communication channels to raise awareness of FTA benefits and encourage investment in compliance and innovation.

The FTA Index measures how effectively localities implement Viet Nam's trade agreements, serving as a catalyst for innovation, administrative reform, and greater support to help businesses diversify markets, strengthen supply chains, and expand export portfolios./.