Prospects for Closer Cooperation

10:53:06 AM | 12/20/2022

Five years after establishing the Comprehensive Partnership, Vietnam and Canada have witnessed momentous progress in bilateral cooperation. To further reinforce their friendship, trade and investment cooperation ties, the Vietnam Chamber of Commerce and Industry - Ho Chi Minh City Branch (VCCI-HCM) hosted the conference “Investing Opportunity Vietnam-Canada”.

VCCI Vice President Vo Tan Thanh addresses the conference “Investing Opportunity Vietnam-Canada” 
Impressive trade and investment flows

Speaking at the event, VCCI Vice President Vo Tan Thanh said, since the establishment of the Comprehensive Partnership in 2017, the import and export value between Vietnam and Canada has grown strongly at a double-digit pace. In the 2017-2021 period, annual bilateral trade value grew from US$3.5 billion to US$6.03 billion, and to over US$4.27 billion in the first seven months of 2022. In investment, Canada ranked 14th out of 139 countries and territories investing in Vietnam with 236 projects and over US$5 billion as of May 2022. Meanwhile, Canada ranked 18th out of 78 countries and territories invested by Vietnam, with 15 projects and nearly US$87 million.

Although Vietnam-Canada trade and investment ties are currently growing steadily, outcomes are incommensurate with existing cooperation capacity, he said, adding that the two governments need to make efforts to remove obstacles and facilitate companies of both sides to access and exploit each other's markets. “In fact, Vietnamese exporters have noticed an increase in trade remedies that Canada has applied to Vietnamese commodities. Vietnam asked Canada to apply these measures to Vietnamese products in an objective and fair manner in accordance with WTO regulations. For its part, Vietnam wholeheartedly supports Canada's efforts in starting negotiations for an FTA with ASEAN. This will further strengthen Canada's trade relations with Vietnam and with ASEAN member countries as a whole,” Mr. Thanh emphasized.

Mr. Tuan Le, CEO of Intrinsic Innovations Vietnam, highly appreciated the cooperation potential of Vietnam and Canada, especially in trade. In 2021, the value of bilateral trade advanced 18.5% from the previous year, making Canada one of the 10 major export markets of Vietnam in the Americas.

Notably, the Vietnam-Canada Comprehensive Partnership is producing more fruits grown by free trade agreements (FTAs) that the two countries have entered. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has enabled the impressive growth of bilateral trade since the pact was officially enforced in Vietnam. Together with CPTPP, the opportunity to lift Vietnam-Canada cooperation is more open than ever when ASEAN and Canada officially announced the launch of the ASEAN-Canada FTA negotiations at the end of 2021.

Growth potential from new areas of cooperation

Mr. Andrew Sanden, President of Intrinsic Innovations Vietnam, said that Vietnam-Canada bilateral cooperation has huge potential for growth, particularly business startups and the digital economy which are new but expected to soon achieve outstanding progress. Typically, the Canada success story of FPT Corporation, Vietnam's leading technology firm, has raised confidence for thousands of other digital companies in their journey to reach out to the world. Since its establishment in 2017, FPT Canada has specialized in manufacturing and projects for many partners in North America. The company’s first project generated development opportunities not only for partners in Alberta, Canada's fourth most populous province, but also to many other well-known customers in Canada.

Sharing the same view, Mr. Tuan Le emphasized that Vietnam has a very strong startup ecosystem with more than 3,800 technology startups, including 2,000 in Ho Chi Minh City (65% software and 21% AgTech). The substantial growth of the Vietnamese economic scale and popular accessibility to the Internet and mobile devices are major reasons for huge potential because these factors enable startups to quickly develop and successfully earn profit immediately, even without international expansion. Moreover, a large number of expats and digital professionals in Ho Chi Minh City importantly contribute to local ecosystem development.

According to the StartupBlink annual Global Startup Ecosystem Index 2022 by StartupBlink, a global startup ecosystem map and research center, Vietnam ranked 54th in the world and 5th in Southeast Asia (after Singapore, Indonesia, Malaysia and Thailand). “Vietnam has emerged as an innovation and technology hub in Southeast Asia and this region is looking to bridge the gap with other world-leading economies through digital technology. This is a great motivation for FDI investors, including Canadian businesses, to invest in Vietnam. This is also a reason why my colleagues and I are determined to set foot in the S-shaped country. Intrinsic Innovations aims to cooperate and invest in innovative startups and high-tech companies in Vietnam in education and information technology that are likely to scale out to global markets, especially companies whose founders are interested in the Canadian market," Mr. Andrew Sanden affirmed.

Ms. Linda Truong, Economic Development Investment Director in Calgary City, Alberta province, Canada, said that international innovative startups investing in Canada will receive a lot of support and funding from the local business community as well as the Government-backed investment stimulus programs. Therefore, Vietnamese technology companies need to seize this opportunity to expand their investment and gradually write a business success story in Canada.

By My Chau, Vietnam Business Forum