Vietnam and Singapore have established their relationship since 1973. After the visit of the State President Truong Tan Sang to Singapore in September 2011, both countries agreed to increase bilateral relations. Singapore is now Vietnam’s 5th largest trading partner and the 2nd largest investor.
Vietnam Business Forum interviewed Mr Raymond Lui, Centre Director in Hanoi for International Enterprise (IE) Singapore, on trade and investment cooperation between the two countries.
How do you assess Singapore's investment into Vietnam in recent years?
Singapore companies have been faithful growth partners for Vietnam. They have continued to invest steadily and expand their businesses in Vietnam over the past few years. Singapore companies take a long term view of this market. Vietnam’s proximity to Singapore, its 46 million-strong workforce and progress towards a market economy are factors that encourage our companies to invest in this market. The strong economic relationship can be seen in the growth of trade and investments between both countries.
Singapore is currently Vietnam’s 5th largest trading partner. Bilateral trade between the countries has seen an overall four-fold increase since 2000, to reach US$10.1 billion in 2010.
We are one of the largest foreign investors in Vietnam with cumulative investments of nearly US$23 billion in 945 projects.
What are typical examples of Singapore’s investment growth in Vietnam?
On a broad level, the Vietnamese government has taken concrete steps to create a business environment that is open to foreign investments. This is an encouraging move, and is critical as Vietnam transitions into a market economy. The implementation of these policies will be equally important.
Sembcorp is an example of a Singapore company that has been very successful in Vietnam, with strong support from both the government and the local community.
Sembcorp established the first VSIP in Binh Duong in 1996 and has since grown it to four VSIPs today. Such close cooperation has led to strong outcomes for the local economy. Sembcorp’s four VSIPs have collectively attracted 440 customers with US$4 billion of investments and created more than 100,000 jobs for the local economy.
Recently, the two countries have seen significant progress in bilateral cooperation with some big signings. Firstly, In September 2011, Sembcorp Industrial Parks signed a memorandum of understanding with the People’s Committee of Quang Ngai province to conduct a feasibility study for building a fifth Vietnam-Singapore Industrial Park (VSIP) in the Dung Quat Economic Zone. This is Sembcorp’s first foray into the central Vietnam region. Secondly, in May 2011, CapitaValue Homes, a subsidiary of Singapore’s CapitaLand, signed a Joint Venture Agreement with Khang Dien Sai Gon Real Estate to build 974 value homes in Ho Chi Minh City. This investment is estimated to be worth US$70 million. Besides, Singapore’s NTUC Fairprice entered a joint venture with Saigon Co-op in December 2010 to set up a chain of hypermarkets in Vietnam, expected to be operational by 2012.
As Singapore's leading agency in promoting international trade and assisting Singapore enterprises to invest abroad, could you please tell us about IE Singapore’s support for Singapore enterprises investing in Vietnam?
As the lead agency under the Singapore Ministry of Trade and Industry that promotes international trade and overseas expansion of Singapore-based companies, International Enterprise (IE) Singapore plays a key role in promoting the growth and investments of Singapore companies in Vietnam.
Through our two Overseas Centres in Hanoi and Ho Chi Minh City, we have been helping Singapore companies establish business connections on government, enterprise and community levels. We also share market information with companies and assist them in building up their firm-level competencies where necessary before they enter Vietnam.
Trade and investments between the two countries have been growing, and we see a healthy stream of projects taking place in Vietnam, as mentioned earlier. We see continued interests from Singapore companies to do business in Vietnam and will continue to be on the lookout for partnership opportunities.
Vietnamese
