A stronger digital tie with Indonesia

September 17, 2018 | 11:00
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Industry 4.0 has brought Vietnam and Indonesia closer, with the two countries having expanded their co-operation in the digital technology field.
a stronger digital tie with indonesia
Prime Minister Nguyen Xuan Phuc met with Indonesian President Joko Widodo, Photo: VNA

During Indonesian President Joko Widodo’s state visit to Vietnam last week, Go-Jek, the Indonesia-based ride-sharing company valued at $5 billion, launched its Go-Viet service in Hanoi. It is expected that the company will continue expanding its operations to other localities in Vietnam.

“It is great news,” said Prime Minister Nguyen Xuan Phuc. “I know that this service will operate based on an Industry 4.0 platform.”

Recently, Go-Jek began its ambitious plan to increase its rivalry with Grab by expanding operations to Ho Chi Minh City, where its Go-Viet service will cover an initial 12 districts, with a motorbike on-demand service. Grab is present in 39 cities and provinces in Vietnam and its services include motorbikes, taxis, private cars, and food delivery.

According to Indonesian Ambassador to Vietnam Ibnu Hadi, it is likely that more Indonesian companies operating in e-platforms will come to Vietnam in the near future. This is in line with the two countries’ new commitment to expand bilateral co-operation in the digital technology field.

According to a joint statement released by both nations last week, to seize opportunities and face the challenges of Industry 4.0, in addition to facilitating co-operation between businesses from both countries, Vietnam and Indonesia “agreed to promote innovation by enhancing joint research, capacity building on intellectual property (IP), and technical assistance and training of IP professionals.”

Notably, last week saw Vietnam and Indonesia sign a new action plan as part of the Vietnam-Indonesia strategic partnership for the 2019-2023 period.

The new plan covers a number of co-operation sectors, including political, economic, trade, investment, culture, society, and maritime issues. New co-operation sectors are also included in the plan, such as digital technology, IP, and connectivity in seaports and airports.

Vietnam and Indonesia have also vowed to expand their strategic partnership via the removal of trade and business barriers and an expansion in other new co-operation sectors in favour of their businesses and people.

“The leaders agreed to implement stronger measures to facilitate and promote bilateral trade, including the removal of unnecessary trade barriers and measures which are inconsistent with international and regional trade rules and norms, providing broader market access for the two countries’ goods and services,” the joint statement said.

Indonesia took note of Vietnam’s proposal on removing regulations on the rate of local content in Vietnam’s key export items such as mobile phones, televisions, agro-forestry-fishery, steel, construction material, and electrical equipment, making it easier for these products to enter the Indonesian market.

Vietnam and Indonesia are committed to effectively deploying an agreement in farm produce and are considering establishing new joint ventures in aquaculture, wood processing, and wooden furniture export, and expanding tourism co-operation, especially for sea and island tourism.

“The countries’ leaders encouraged greater two-way investment. They welcomed and supported increasing bilateral investment in infrastructure development, manufacturing, agriculture, services, tourism, information technology, health, transportation, construction, and logistics,” the joint statement said. “The leaders agreed to further promote co-operation in the energy sector and encouraged active participation of state-owned and private enterprises from both countries, in particular in oil and gas exploration and production, the refinery industry, and services.”

According to Ambassador Hadi, the implementation of these commitments will help the two countries to soon realise their annual bilateral trade target of more than $10 billion by 2020.

Two-way trade turnover hit $4.7 billion in the first seven months of this year, and the ambassador expected that the figure would be $8 billion for the whole year, $9.2-9.3 billion next year, and over $10 billion by 2020.

Currently, the Indonesian Embassy to Vietnam is supporting Vietnam’s private carrier Vietjet in opening a direct air route from Ho Chi Minh City to Bali. It is expected that this route will be officially launched next month.

As of August 20, Vietnam had 72 valid investment projects by Indonesian investors registered at $583.28 million. Vietnam has 13 valid investment projects registered at $54.7 million in Indonesia, operating in mineral exploitation, wholesale and retail, and ICT.

By Dat Thu

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