Vietnam - Spain Bilateral Relations Further Enhanced

Vietnamese Government’s open door policy to private and foreign investors has created a future with great hope and opportunities for Spanish investors. On the occasion of 32^nd anniversary of Vietnam-Spain diplomatic relations, Vietnam Business Forum reporter Le Phuong talks with Mrs. Maria de la Soledad Fuentes Gomez, Spanish Ambassador to Vietnam.

First of all, I would like to highlight the fact that Spain and Vietnam established diplomatic relations 32 years ago, in May 1977. During that period, a lot has been achieved in different fields with the effort of both countries, although there are still many challenges ahead.

 

Another big landmark in our bilateral relationship took place in 1997, with the opening of the Spanish Embassy in Hanoi and its Economic and Trade Office in Ho Chi Minh City. This process was completed with the inauguration of the Embassy of Vietnam in Spain in 2002.

 

1997 was also an important year because it was then when Spain started non-refundable cooperation with Vietnam. From that moment, we have been cooperating in areas such as health, agriculture, education, tourism and infrastructure.

 

Finally, in the chapter of visits, the Vietnamese former Prime Minister Phan Van Khai visited Spain in 2001, and the Spanish Queen Sofia and King Juan Carlos I paid a state visit to Vietnam in 2006. At the end of this year, President Nguyen Minh Triet is expected to visit Spain, and this will be an occasion to boost further our bilateral relations.

It is true that Spanish investments in Vietnam still have a big room for improvement; this is mainly due to historical reasons. In the last decade most Spanish companies focused on other areas such as Europe, Africa or Latin America, due to cultural and historical links which made it easier for them to invest there. But this is changing and will keep on changing in the coming years because of the growing awareness of the importance of Asia and Vietnam, in particular, for Spanish companies. Many companies which have already started to work in China in the last few years are very much interested in investing in Vietnam, taking advantage of the forecast of growth in the area. And we shouldn’t forget that Spain has some of the most important companies in the world in infrastructures such as roads, railway or airport construction, one of the key sectors for Vietnam’s development at present. Interest in Asia in general and in Vietnam in particular is on the rise in Spain. This could be seen clearly at the recent 41st Annual Meeting of the Board of Governors of the Asian Development Bank, which took place in Madrid last May, or in the successful Spain - Vietnam Investment & Business Cooperation Forum celebrated in 2008 in Ho Chi Minh City where more than 160 companies for both countries had the opportunity to meet in several round tables and sector specific seminars.

In the upcoming months we have scheduled around ten economic missions, in different fields. Garment, industrial machinery, food processing and tourism are some of the sectors that will be represented. Besides that, we are working in two specialized seminars, one in the tourism sector and another in IT industries. We have not closed the days yet but it will probable be some time in October or November.

I think one of the sectors is retailing, very dynamic in the last few years, and where changes will take place soon. Tourism has always been a major sector for Spain and there are possibilities for Spanish companies to come to Vietnam. As I said before, IT firms also show a growing interest in Vietnam due to its qualified workers. Architecture and urban planning are other areas where our two countries are working together. And I want to point out that infrastructure, and in particular transport infrastructure, and renewable energies should be other key area for cooperation. Spain has become one of the most advanced countries in renewable energies and this should develop at a good pace in Vietnam in the next few years due to its climatic characteristics. One of the challenges for Vietnam will be to combine its economic and industrial growth with respect for the environment and fight against climatic change. In this field Spain can contribute, for example, with its knowledge in water treatment, another challenge for Vietnam.

The investment environment has been improving in the last two years, since the WTO accession, though it was already good before that date. Now we are facing difficult times due to the financial crisis, and we see how some companies are reluctant to invest. But in the bleak prospect of the world’s economy, Vietnam is one of the only countries that keep on growing at a good pace. For this year most of predictions, like the one from the Asian Bank of Development (4, 5 percent) say Vietnam will behave better than other countries. And the economy is expected to rebound in early 2010 here but it seems it may take longer in Western developed countries. To this economic advantage with regard to the surrounding countries, the need of new infrastructures and the support the Vietnamese government grants to foreign investment results in Vietnam becoming a very attractive place for investors. In general, Spanish investors in Vietnam are satisfied with their situation. The government is making an important effort in adjusting domestic regulations to WTO requirements and its policies have been very successful, not only in attracting foreign direct investment but also in fostering the performance of the overall economy.