Vietnam, Cuba Expanding Economic Cooperation

Since the two countries established diplomatic ties in 1960, after more than half a century of cooperation and mutual support, Vietnam and Cuba have always been loyal brothers and traditional supporting partners. Since then, the two sides have signed a series of economic and commercial agreements to facilitate trade, including the Agreement on Trade Exchange and Other Economic Cooperation in 1996, the Agreement on Investment Encouragement and Protection in 1995, the Agreement on Tourism Cooperation in 1999, the Agreement on Cooperation in Quarantine and Plant Protection, and the Agreement on Avoidance of Double Taxation and Prevention of Fiscal Evasion for Income Taxes in 2002.

 

Dr Doan Duy Khuong, Vice President of VCCI, said that although Vietnam and Cuba have a fine traditional relationship, bilateral trade and investment ties have yet to meet expectations because of objective factors such as geographical distance and language barriers.

 

In 2013, the two-way trade turnover totalled only more than US$142 million, of which Vietnam earned US$132.44 million and Cuba took US$9.87 million. In 2014, the value rose 45 per cent to US$207.5 million, of which Vietnam fetched US$206 million and Cuba bagged more than US$1 million. In 2015, it climbed to US$235 million.

 

Vietnam exported rice, cereal, confectionery, footwear, ceramics, sanitary wares, construction materials, coal, apparels and chemicals nature to Cuba while it imported pharmaceuticals and functional foods from the Caribbean country.

 

Statistics from the Ministry of Planning and Investment (MPI) showed that Cuba had one project in Vietnam with a total registered investment of US$66 million as of December 2015, ranking 75th among over 100 countries and territories investing in Vietnam.

 

Meanwhile, a number of Vietnamese businesses have conducted large projects in Cuba, including PetroVietnam Exploration Production Corporation (PVEP) affiliated to the Vietnam National Oil and Gas Group (PetroVietnam), Viglacera Corporation, Hanel Company, Thai Binh Trade and Investment Company, and Tin Thanh Steam Power Co., Co., Ltd.

 

VCCI Vice President Khuong said Cuba and the United States recently normalised their bilateral ties after more than 50 years of break. And, in March 2016, Cuba signed an agreement on relations normalisation with the European Union (EU). These steps have paved the way for the country to boost its economic growth when the door of deeper integration with the world is opened up for Cuban people and businesses. At the same time, this is also a good opportunity for Vietnamese companies to make investment and do business in Cuba in such fields as tourism, agriculture, telecommunications, consumer goods, footwear and apparel which Cuba needs and Vietnam has strengths. In the meantime, Cuba is strong in pharmaceuticals, education, health and construction with which Vietnam can make good cooperation. The establishment of Mariel Special Economic Development Zone - the first free export processing zone in Cuba - is a good chance for Vietnamese companies, which are already traditional trade partners of Cuba, to increase investment in this beautiful Caribbean island nation and penetrate deeper into the US market, Latin American countries and the European Union (EU).

 

“The intensified economic cooperation between the two countries is not only the responsibility of the two governments, but also depends heavily on the dynamics of the business communities. With the fine friendship between Vietnam and Cuba, with the support and concern of the governments and peoples, the economic, trade and investment cooperation between the two nations will develop sustainably and strongly in the coming time,” he added.

 

Dr Khuong said VCCI is always willing to work closely with the Cuban Embassy and Cuban trade promotion organisations for the sake of cooperative relationship development between the two countries' business communities.

 

Mr Herminio López Díaz, Cuban Ambassador to Vietnam, said that Cuba started reforming social and economic development to catch new opportunities since 2011. New policies are creating favourable conditions for investors and businesses to develop.

 

“Cuba wants to accompany Vietnamese businesses to develop its economy. Furthermore, Cuba also wants a greater presence of Vietnamese companies in the country and wants to boost Cuban exports to Vietnam,” he said.

 

The ambassador also thanked Vietnamese companies, in one way or another, for promoting trading between Vietnam and Cuba and supporting trade and investment cooperation between localities of the two nations to exchange information and expanding trade and business relations in the two countries in the coming time.