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Last updated: Wednesday, July 18, 2018


Vietnam-Hungary: Still Untapped Potential to Fully Utilize

Posted: Friday, September 08, 2017

The Hungarian Prime Minister Viktor Orban will visit Vietnam this September. On this special occasion, the Vietnam Business Forum conducted an interview with Hungarian Ambassador Ory Csaba about the visit as well as the bilateral cooperation prospects.

Hungarian Prime Minister Viktor Orban is scheduled to visit Vietnam in September 2017. Could you please tell us more detail about the visit?
Hungary and Vietnam have been enjoying 67 years of uninterrupted friendship and diplomatic relations. The Government of Hungary regards Vietnam as a strategic partner in South East Asia and counts on further developing our political and economic relations in both bilateral and multilateral areas. Regional stability and peace in South East Asia are both in the political and economical interest of Hungary and in a wider sense, of the European Union. Our Prime Minister’s visit aims at giving a comprehensive overview on the development of our political and economic relations and set the political and commercial path for the upcoming years. It is our mutual interest of revitalizing our traditionally good relations, involving the new and young generations at a larger extent into our foreign trade and business cooperation.

What can you comment on the multifaceted cooperation between the two countries over the years, especially in the fields of economic, trade and investment? Is there any figure illustrating the growth of bilateral cooperation?
Hungary looks at Vietnam as a quasi-strategic trade partner in the South-East Asian region. According to the General Department of Vietnamese Customs, bilateral trade reached a growth of 37.8 per cent in 2016, amounting to US$269.2 million compared to the previous year. Within this, Vietnamese exports grew 45.5 per cent, while imports grew 33.9 per cent, with the volume of US$95.9 million and US$173.3 million, respectively. These trends have been continuing during the first seven month of 2017.

The top three Vietnamese export commodities to Hungary were garments and textile products, electronic goods and transport means, while the top three Hungarian export commodities exports to Vietnam were medicine and other pharmaceutical products, public transport vehicles and different processed goods.
The Hungarian Government attaches great importance to deepening cooperation with Vietnam on the basis of mutual interest and respect in all potential areas, including especially trade and investments. In recent years we could see a steady double-digit increase in bilateral trade exchanges; however, its volume is still below the desired level.

From the Hungarian perspective, we see high potential in supplying to Vietnam high-tech agro-food products and technologies, pharmaceutical products, medical devices, different machineries and equipment, as well as increasing cooperation in the field of ICT, water management, environment protection, renewable energy. Hungarian products are safe and competitive, finding already large markets in Asia. Vietnamese consumers should also enjoy their benefits. 

Aiming at further deepening our economic cooperation, the Government owned Hungarian National Trading House (HNTH) has established its presence in Vietnam, which plays an important role in promoting trade between our countries. Their local HQ is located in Ho Chi Minh City.

In recent years we have completed some large projects such as the water-treatment plant in Quang Binh province, or the population registry project in Hai Phong. We believe that investments could be increased substantially by strengthening cooperation between the SMEs through establishing joint ventures and transferring modern technologies to Vietnam. Hungarian companies are interested in establishing partnership with Vietnamese companies; this was demonstrated by the large number of Hungarian participants in the VCCI Business Forum.

I would like to encourage Vietnamese companies to take advantage of the presence of the Hungarian companies in Vietnam and increase their interest in doing business with Hungary.

I would also like to confirm to Vietnamese companies that they are welcome in Hungary as a hub for their EU businesses, enjoying the benefits of the favourable Hungarian investment climate and excellent geographic location. The stability and accountability of the Hungarian economy, one of the fastest growing in EU, give them a long-term perspective to settle down and develop their businesses in Europe.

Our bilateral economic cooperation will enjoy more benefits after the EVFTA enters in force.

On a Governmental level both countries have already done a lot to promote economic cooperation. We established regular exchanges of high-level delegations and maintained the regular meetings of the Joint Committee of Economic Cooperation (JCEC), which is a successful and effective forum for discussing and setting up lines of cooperation. We also encouraged the organization of business events, workshops, visits of business and expert delegations, while on Hungarian side we offered substantial financial support to Vietnam in the value of €500 million, but it should be emphasized that the efforts of the governments will bring their desired fruits only if all stakeholders of businesses will join to them and actively utilize the already given good spirit and favourable conditions.

Hungary has strengths in renewable energy, supporting industry, environmental protection, water resource management, information technology, economics, agriculture and healthcare. What will Hungary do to support Vietnam in these fields?
In addition to the ODA package offered by Hungary in the value of €500 million to Vietnam, we are ready to implement other projects based on our expertise and references in Vietnam on commercial basis, working together with Vietnamese authorities, local governments and private sector stakeholders. Hungarian companies and institutions are ready to share their expertise and technology with their Vietnamese partners in different ways, like exchange of expert delegation and information, joint ventures, supply of high-tech products and technologies. To promote this cooperation, the Hungarian Eximbank is ready to provide additional finance to companies on the basis of preferential commercial credits. 

Though the Hungarian economy is still in difficulty, Hungary supports Vietnam a €440 million credit. Could you talk about the significance and expectation of Hungary from signing this framework agreement?
Let me begin immediately with clarifying that the Hungarian economy is not at all in a difficult situation. Between 2010-2014, in the first term of the present government (it was re-elected in 2014) there had been several reforms that Hungary had introduced to stabilise the macroeconomic situation in order to respond to both domestic and external challenges. The methods that we applied at that time were rather different from what usually IMF prescribes. Economic developments in Hungary in recent years have clearly demonstrated that macroeconomic stabilisation can go hand in hand with growth stimulus. By now we have a stable macroeconomic environment, public debt is continuously reducing, budget deficit is kept well below the Maastrich criteria, inflation is under 2 per cent, while export is growing in double digits and economic growth among the highest in Euro-zone countries. Our results have been acknowledged by several international credit rating institutes by upgrading the ratings of Hungary. Solid macroeconomic foundation and a steady growth of our economy allowed us to offer Vietnam a substantial ODA package this year.

The fact that Hungary is able to support developing countries with tied aid loans and agreements shows not only our financial capability, but also our long-term strategy in enhancing cooperation with our most trusted partners. The €440 million plus €60 million tied aid credit package that Hungary offered to Vietnam is the largest ever offered to a country. I personally believe that this will benefit the development of various sectors in Vietnam and we continue to work hard on identifying the mutually advantageous projects that we both wish to realize from this package in an effective and sustainable way. One of the first projects we aim to accomplish will be the building of an oncology hospital in Can Tho, I am confident that the groundbreaking ceremony at the construction site may be organized a few weeks after the Prime Minister’s visit in Can Tho.

What do you think about the prospect the Vietnam and Hungary relations development?
Hungary and Vietnam have been friends for 67 years and during difficult times as well. In the framework of the “Opening to the South” policy of the Hungarian Government, we are ready to move forward and modernize our long-term partnership with Vietnam. I believe that our relations entered into a new phase, a kind of crossroad, from where we should concentrate more on the areas of cooperation of key interest, with special regard to economic, trade and investment relations.
Our bilateral relations are improving with intense dynamism. Besides the significant economic cooperation, we have a rapidly growing educational and a fruitful cultural collaboration. The development of our economic and trade relations is characterised by the tied aid loan projects.

Despite the geographical distance we have many cultural links connecting our nations. We are proud to have thousands of Vietnamese citizens who graduated in Hungary and speak our language. Based on this solid foundation, we are confident to meet the challenges of today.

We equally stress the importance of attracting more young Vietnamese to study in Hungary – for that, we aim at increasing the number of state scholarships during our PM visit.

The Stipendium Hungaricum Scholarship Programme was started in 2013 as a part of the Government “Global Opening Policy”. Vietnam is one of our major partners and has a total of 100 places available with no tuition fee for Bachelor, Master or Doctoral candidates. The new Cultural Cooperation Programme is planned to be signed during the visit of our Prime Minister. The programme will pave the way for bilateral cooperation regarding international exchange programmes and cooperation in the field of preservation of the cultural heritage, protection of cultural goods and public collections, cooperation of literature and presentation of the results of the cultural and artistic life of both countries. We have plans for an important literary translation program, for showing gems of the Hungarian cinema. Cultural events are regularly organised by our embassy and we also participate at the major festivals. I would recommend to visit the Facebook page (https://hu-hu.facebook.com/HUNEMBHANOI/) or the homepage of the Embassy (https://hanoi.mfa.gov.hu/) where we provide information about our activities.

I share the view that we still have untapped potential in our cooperation and now it is our duty to fully utilize them. With joint efforts, we see good prospects for increasing cultural and trade exchanges, investments and people-to-people relations.

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