Vietnam & Singapore Establish Strategic Partnership
Sept. 12 – Yesterday, Vietnamese Prime Minister Nguyen Tan Dung and his Singaporean counterpart Prime Minister Lee Hsien Loong agreed to elevate the two countries’ friendship and comprehensive relations into a strategic partnership during talks held in Hanoi.
Specifically, the newly established strategic partnership will cover five major items, including:
- Deepening mutual trust in the two sides’ political relations;
- Boosting economic cooperation;
- Increasing cooperation in security-defense;
- Promoting bilateral ties in fields such as education, law, health, culture, art and sports; and
- Intensifying cooperation at regional and international forums.
The talks, which coincided with the 40th anniversary of the two countries’ diplomatic ties, had PM Dung welcoming the Singaporean delegation to Vietnam, and PM Lee praising Vietnam for its accomplishments in national construction and in developing towards becoming a truly industrialized country by 2020.
Singapore is currently Vietnam’s second largest investor, and, as such, during the talks PM Dung emphasized the fact that Singapore has always been one of Vietnam’s top investors and trade partner. Two-way trade between the two countries surpassed US$9 billion in 2012 – up from US$8.7 billion a year earlier – and has already reached US$3.5 billion through May of this year.
Vietnam’s current main imports from Singapore include petrol, plastic, metal, electronic products, machinery and chemicals; while Singapore mainly imports seafood, coffee, crude oil, precious stones and electronic goods from Vietnam.
Further, as of this past July, Singapore has nearly 1,800 foreign direct investment (FDI) projects scattered throughout Vietnam worth over US$28 billion in the property and construction, processing and manufacturing industries.
Another sector the two countries are pushing to grow is the tourism industry by way of air travel, as PM Lee noted: “We envisage progress in air services where we can increase air traffic between our countries and also from our countries to the rest of the world.”
On top of that, PM Lee also said that Singapore-based banks hope to set up subsidiaries in Vietnam to create links and contribute to its financial sector by way of providing technical assistance.
“In financial services, Singapore will be happy to provide technical assistance to our Vietnamese counterparts while Singapore banks hope to set up subsidiaries here and contribute to Vietnam’s financial sector,” he noted.
During the talks, PM Lee also further encouraged and pushed Singaporean investors to invest more in Vietnam, especially in the seafood processing, clean vegetable cultivation and genetic technology fields. In return, he will push for more favorable conditions for Vietnamese exports – which include agro-forestry-seafood and garment products.
Both sides also agreed to strengthen cooperation on educational training, energy (oil and gas), agriculture, construction, transport, labor, finance, post and communications and information technology.
Both PM Lee and Dung praised the development of the Vietnam Singapore Industrial Park Joint Venture Co., something that was initiated by the two governments in 1996. The joint venture – which is 49 percent owned by Vietnam’s Becamex IDC Corp. and 51 percent owned by a consortium led by Singapore-based SembCorp Industries Ltd. – has developed four world-class industrial parks in Vietnam.
The industrial parks, which are located in in the provinces of Binh Duong, Bac Ninh and Hai Phong city, have successfully contributed to the development of Vietnam’s central region and are home to more than 310 companies, 110,000 worker and a total investment capital of nearly US$5.3 billion.
The leaders are also expected to attend the groundbreaking ceremony for a fifth park later this week in the central province of Quang Ngai, which is expected to have an investment of over US$337.8 million.
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam as well as liaison offices in Italy and the United States.
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