Vietnam and Denmark: Already Close Ties Expected to Be Further Strengthened

During my first year in Vietnam I have been particularly impressed by the very friendly and hard working Vietnamese people. Wherever you go in the country you meet a very friendly population which, combined with the fascinating cultural heritage and history, the beautiful scenery and splendid cuisine, makes it a very special place to visit and live in. Vietnam is also a society undergoing rapid changes as a consequence of two decades of high economic growth rates and I hope that Vietnam, in order to ensure the good quality of life for its citizens, will take great care of the environment and its natural heritage.

 

In 1971 Denmark was among the first countries in the West to recognize the Socialist Republic of Vietnam after the war. Over the years, relations between our two countries have been very strong in development cooperation, and more recently cooperation on culture and commercial relations has had high priority.

 

In the past 40 years, Denmark has provided Vietnam with more than 1 billion US dollars in the form of grants for development assistance activities and additional credits for infrastructure projects. Danish aid to Vietnam has brought many concrete results within the fishery, agriculture, water and sanitation, and environment industries, as well as new areas such as legal support. Climate change is another important area in our development assistance to Vietnam. We are supporting Vietnam with a US$40 million grant for Climate Change Adaptation and Mitigation. 

 

Danish ODA also contributes to the development of the private sector that is increasingly becoming the driving force in Vietnam’s high economic growth. Denmark has actively been supporting small and medium sized enterprises (SMEs), via the Business To Business Programme (B2B) and the Business Sector Program Support (BSPS). In December 2010, a new agreement in which Denmark will provide approximately US$23 million to strengthen business sector development in Vietnam during 2011-2013 was signed.

 

In general, Danish development aid has contributed to Vietnam’s social and economic development. Particularly, during 2010 Denmark supported Vietnam with US$65 million in ODA.

 

In term of political dialogue, 2009 was a very intensive year with the Vietnamese Prime Minister visiting Denmark and the first ever Danish State Visit to Vietnam. The political talks with the Danish Prime Minister and other ministers demonstrated that Vietnam and Denmark share a broad range of mutual interests in promoting international cooperation. With the State Visit in late 2009 led by Her Majesty Queen Margrethe II of Denmark and His Royal Highness the Prince Consort, relations between the two countries progressed to a new level of interaction.

 

This year 2011 is very special since it marks the 40 year anniversary of Danish-Vietnamese diplomatic relations. On this occasion, His Royal Highness, the Crown Prince of Denmark will visit Vietnam in late November together with the Danish Minister of Trade and Investment who will have political talks with Vietnamese government representatives. We expect that the visit will further strengthen the already close ties between Vietnam and Denmark.

My ambition in my term as ambassador is to ensure that we deepen the cooperation between our two countries and move into a more comprehensive partnership based on increased political dialogue and a general strengthening of commercial links; including development of cooperation within green growth, such as clean energy production and efficiency, climate change, culture and research.

 

Denmark is one of the leading countries with solutions for climate change, renewable energy, and energy efficiency and Vietnam has expressed great interest in increasing cooperation within these areas. Vietnam needs to work towards focusing more on sustainability and green growth as part of its development model. This is crucial as renewable energy and in general a green growth focus has the potential to deliver millions of new jobs, transfer high value-added technology to Vietnam, and diversify economic development.

 

I believe that the technological strongholds and know-how of Danish companies in this area can provide an important contribution to the sustainability of economic growth in Vietnam in the coming years.

 

I would also like to see more Danish tourists coming to visit your beautiful country. Last year some 22,000 Danes visited Vietnam, but I am sure the combination of friendly people, beautiful scenery, nice beaches and fascinating history will be able to attract more in the future.

 

Commercial cooperation between Vietnam and Denmark is stronger than ever before. During the last year we have had a number of Danish business delegations visiting Vietnam as we see potential for commercial cooperation within a host of sectors, including ICT, pig breeding, garment and textile as well as water and sanitation. These activities are organized by the Embassy of Denmark with the objective to help Danish companies explore business opportunities in Vietnam, meet potential Vietnamese partners and create new commercial partnerships.

 

Not only is Vietnam interesting as a sourcing and production destination, but due to the rapid economic development in the country, Vietnam is also an interesting domestic market. There is an interest from both small and medium sized companies and we also have some of the biggest companies in Denmark like AP Moller/Maersk and Carlsberg.

 

When His Royal Highness, the Crown Prince of Denmark visits Vietnam, he will also head a big business delegation and I foresee that this will mark the beginning of even stronger trade and investment ties between Denmark and Vietnam.

 

What are the Danish companies’ strengths and investment cooperation opportunities for Vietnamese enterprises?

Despite being a small country of 5.3 million people, Denmark has several very large companies like AP Moller/Maersk, a world-leading shipping company and seaport operator; Carlsberg, one of the four world leading beverage producers; and Lego, one of the world’s most important toy producers. They are all present in Vietnam today. We also have a lot of world class expertise within the area of clean technology and green growth – Danfoss, Grundfos, and Vestas to name but a few.

 

Danish companies contribute with a high level of skilled and knowledgeable human resources. The Danish company culture of corporate governance is very different from the one in Vietnam. The main value of Danish corporate governance is to consider each individual as an independent entity who is free to create, who can think out of the box, and who is not only required to follow strict hierarchical instructions.

 

Besides, Danish companies always believe that if working environments for employees are improved, productivity and performance will be boosted. Therefore, they seek to improve the working environment for employees, promote gender equality and create a friendlier environment at the working place.

 

With such strengths and advantages, I believe that Danish companies can provide knowledge, skills, high technology, consultancy and support for the Vietnamese business sector to do business more effectively and contribute to a more sustainable and competitive growth in Vietnam.

 

Since Vietnam joined WTO in 2007, significant progress in improving the business environment has been made. But I think other factors need to be further improved in order for Vietnam to strengthen its competitiveness.

 

First, it is important that the Government of Vietnam give clear signals about its macroeconomic policies, signals that could help build confidence and support businesses investing in Vietnam.

 

Second, Vietnam has a shortage of skilled workers. Many foreign companies are in need of workers with specific qualifications or knowledge. Therefore, the quality of the education system, at all levels, must be enhanced. Improving the quality of education is, in my view, the key to the future development of Vietnam.

 

Third, Vietnam needs to develop and improve infrastructure such as roads, airports, seaports and telecommunications systems. That also includes a sustainable energy system to reduce power cuts.

 

Fourth, I believe that a well-functioning legal system is crucial for Vietnam if it wants to attract and sustain further investment in the future.

 

One of the other key concerns is corruption. The Vietnamese Government is well aware of this and has developed a comprehensive anti-corruption policy. However, corruption still remains a challenge if the country wants to attract more foreign investors.

 

Many investors are interested in Vietnam not only as a sourcing market, but increasingly as a potential consumer market. If Vietnam could gradually improve the above mentioned issues, then it has good opportunities to attract more investors and continue further on the growth path it has entered.

 

Trade between our countries is picking up after the financial crisis. At the moment, there are more than 120 Danish companies operating in Vietnam. In 2011, we will make further efforts to strengthen the interests of Danish enterprises in some prioritised areas such as textile and garment, food safety, water technologies, green growth and clean energy, education, and oil and gas industries.

 

The visit of His Royal Highness the Crown Prince, who will be accompanied by a high ranking delegation including the Danish Minister of Trade and Investment and a big number of Danish companies, is a great opportunity. The delegation will be visiting Hanoi and HCMC. Focus areas will be green growth, renewable energy and energy efficiency, water and sanitation, food safety, education and environment friendly solutions for the oil and gas industry. All are areas where we believe Danish companies, universities and schools have technology, products and know how that can be most useful for Vietnam when tackling some of the major challenges that your country is facing. A number of business seminars will be organized around these themes. Besides, there will be a number of business lunches, individual company seminars and business meetings, where Danish and Vietnamese businessmen can network and discuss.