Vietnam has become one of the most open economies in the world but suffers from inefficient customs and border procedures that lead to long delays at the ports and hurt Vietnam’s trade competitiveness. Last week, USAID awarded a Trade Facilitation Program (TFP) contract to implementing partner Nathan Associates, Inc., which will focus on many of these challenges.

Over the next five years, USAID will work with the General Vietnam Directorate of Customs under the Ministry of Finance to help Vietnam adopt and implement a risk management approach to modernize and expedite customs procedures. The award announcement coincided with the news last week that the Government of Vietnam notified the World Trade Organization (WTO) of its Category B and C commitments under the Trade Facilitation Agreement (TFA), a treaty that came into effect worldwide in February 2017. These commitments determine the timeline for Vietnam’s customs reform procedures that may require more time to be implemented or require external technical assistance.

So What? Vietnam’s implementation of a risk management-based trade facilitation system will increase Vietnam’s economic competitiveness by expediting and increasing trade flows, lowering trade costs, and increasing the country’s economic growth.