PM’s German visit has a promising payoff

Prime Minister Phuc’s July 5-8 visit to Germany resulted in 28 agreements with a total value of over $1.7 billion. Photo: VNA

Prime Minister Nguyen Xuan Phuc made the statement at the Vietnam-Germany business forum, held as part of his four-day German visit from July 5-8. During the official visit, 28 agreements with a total value of over €1.5 billion ($1.71 billion) were signed, with a focus on energy, heavy industry, IT, auto, and foodstuffs.

The government leader told the forum that Vietnam’s business climate has been improved much in line with international norms. Evidence for this is the improvement in the World Bank’s 2016-2017 business climate ranking, climbing from 91st to 82nd place out of the 190 countries surveyed.

“Vietnam is opening its market in line with international commitments, especially with the 12 signed free trade agreements (FTA). Vietnam also removed business barriers in many sectors, including services, telecommunications, banking and finance, allowing foreign investors to join in,” Phuc said.

“More opportunities are opening to foreign investors as Vietnam is accelerating merger-and-acquisition (M&A) deals in infrastructure, transportation, airports, expressways, seaports, electricity, telecommunications, food industry, agriculture, and service.”

Phuc expressed his hope that Germany would encourage its businesses to intensify investments in Vietnam, especially in the fields that it has strength and Vietnam has demand such as processing, manufacturing, clean energy, and food industry.

One of the areas of special interest among German investors is Vietnam’s long-term goal of developing renewable energy, and the improvements that must be made to the legal framework.

The forum attracted around 600 German businesses and over 100 Vietnamese firms, including Siemens, Philips Lighting DACH, Bayer Healthcare Pharmaceuticals, firms which have had success in Vietnam and are interested in expanding their operations.

Siemens is keen to partner with Vietnam in green energy and healthcare services, digitalised industry development and Industry 4.0. Siemens and other German firms also want to join metro line projects in Ho Chi Minh City and the manufacturing of gas-fuelled turbines in Vietnam.

Bayer, which has been present in Vietnam for 20 years, hopes to make a stronger investment in healthcare and agriculture, while Philips wishes to invest in human resources training and the development of smart cities using the company’s latest technology, which can save up to 65 per cent on electricity costs.

During the visit, PM Phuc held talks with his German counterpart Chancellor Angela Merkel, President Frank-Walter Steinmeier, and Federal Minister for Economic Affairs and Energy Brigitte Zypries, as well as met with the leaders of the Rheinland-Pfalz and Hessen states and Berlin Mayor Michael Müller.

The discussions focused on how to boost investment and trade, with a target of €15-20 billion ($17.12-22.82 billion) in bilateral trade by 2020, in the context the EU-Vietnam FTA is expected to come into force in 2018.

The two sides agreed to improve the effectiveness of existing co-operation mechanisms, such as the Vietnam-Germany Strategic Management Group, Rule-of-Law Dialogue, and working groups in economics and trade and science and technology.

They also reached a consensus on boosting technology transfers and co-operation in fields in which Germany excels, such as wind power, information technology, communications technology, and manufacturing.

While in Germany, PM Phuc attended the G20 Summit, where he highlighted Vietnam’s role as the host of the APEC Summit 2017. He also highlighted co-ordination efforts between Vietnam and Germany in seeking ways to encourage member states to solve issues and help the two summits succeed, thus contributing to global development.

Germany has been Vietnam’s leading trade partner in the European Union for years, with two-way trade reaching $9 billion last year. It is also the fifth-biggest EU investor in Vietnam with total registered capital of $1.68 billion.

As part of his European trip, PM Phuc will visit the Netherlands from July 9-11.