Saudi Arabian businesses eye Vietnam with growing interest

September 13, 2023 | 09:29
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Saudi Arabian corporations and investors are demonstrating heightened interest in Vietnam, signalling a comprehensive deepening of ties between the two nations.
Saudi Arabian businesses eye Vietnam with growing interest
The Vietnam-Saudi Arabia Business Forum

The Vietnam-Saudi Arabia Business Forum, an event that stands as a significant trade and investment initiative between the two nations, took place on September 11 with more than 500 attendees.

Participants included leaders and dignitaries from various departments and businesses within both countries. Deputy Prime Minister Tran Luu Quang graced the event with his presence, and a keynote address highlighted the vigorous economic growth of both nations.

An industry insider told VIR, "This is the largest delegation of Saudi Arabian businesses visiting Vietnam to date, with participation from numerous companies operating in sectors such as tourism, trade, investment, energy, logistics, technology, labour, and more."

According to the Saudi Arabian Ambassador to Vietnam Mohammed Ismaeil A. Dahlwy, Saudi businesses are showing significant appetite for the Vietnam’s market, with prominent corporations like Zamil Steel, ACWA Power, and SABIC successfully operating in the country.

Industries ranging from real estate and energy to steel have seen investments, with the pioneering Zamil Steel project – a 25-year success story – as a prime example.

The chemical giant from Saudi Arabi, SABIC, is deepening its roots in Vietnam by collaborating with some local enterprises. The aim is to enhance sustainable practices, with a keen focus on plastics, solar panels, and advanced ocean plastic waste recycling, among others.

These strategic partnerships underscore SABIC's dedication to fostering environmental responsibility in key markets and broadening the impact of its green innovations.

In addition to its partnerships with leading Vietnamese businesses, SABIC also boasts a robust portfolio of international clients operating within Vietnam. These global conglomerates, some of which have had long-standing relationships with SABIC, include Microsoft, Estée Lauder, and Magnum.

Ranked among the world’s largest petrochemicals manufacturers, SABIC is a public company based in Riyadh, Saudi Arabia.

Saudi Arabian businesses eye Vietnam with growing interest

Meanwhile, Vietnam’s DPM Tran Luu Quang noted, "Both Vietnam and Saudi Arabia have been actively reconfiguring their economic structures towards modernity and sustainability."

This comes as the two nations celebrate the continuous consolidation and development of their amicable relationship and multifaceted cooperation since establishing diplomatic ties in October 1999.

Saudi Arabia stands as one of Vietnam's top economic partners in the Middle East. The bilateral trade volume reached $2.7 billion in 2022, marking a surge of 32.4 per cent on-year. This is especially commendable given the recent global economic backdrop.

Drawing from the solid foundation of friendly relations and recognisable similarities, the DPM expressed confidence in the potential for both countries to bolster each other in their economic transitions and long-term developmental goals, highlighting Vietnam's burgeoning economic and trade ties with over 220 countries and territories.

“Since 2019, the country has witnessed an average annual growth of 10 per cent in import-export turnover. In 2022 alone, this figure reached an impressive $732.5 billion, placing Vietnam among the top 20 nations with the largest foreign trade volumes,” he said.

Vietnam has also become a beacon for foreign direct investment. Currently, over 37,000 projects remain active, with the total registered capital nearing $450 billion. Moreover, Vietnam has inked 16 free trade agreements, including advanced, next-generation examples.

Adopting a comprehensive approach to international integration, Vietnam is enacting policies to deepen relations with Middle Eastern and African nations, exploring the Halal market, and fostering economic collaborations with Muslim-majority countries, including Saudi Arabia.

In a recent move to bolster cooperation, Vietnam introduced electronic visas for citizens of all nations. This step aims to further facilitate trade, investment, tourism, and personal exchanges.

Ambassador Dahlwy echoed the sentiment of robust bilateral ties.

Despite the recent global upheavals, both nations have shown a strong recovery and made notable achievements, particularly in 2022. Saudi Arabia's GDP crossed the $1 trillion mark, making it the fastest-growing economy in the G20, with an 8.7 per cent growth rate.

Simultaneously, Vietnam's GDP surpassed $400 billion, growing by 8.02 per cent and maintaining its position among the top five Southeast Asian economies.

"Over the past 24 years, Vietnam and Saudi Arabia have fostered tight-knit cooperative relations, becoming essential partners in their respective regions. Their mutual support on international and multilateral forums is noteworthy," stated the ambassador.

The Saudi Development Fund has also sponsored 12 projects in Vietnam, contributing a total of $164 million. Currently, a delegation from the Riyadh Chamber of Commerce is visiting Vietnam, marking the largest Saudi business delegation to ever visit the country.

To augment the economic cooperation between the two nations, the DPM emphasised the four pillars of cooperation and three core task groups.

These pillars include enhancing trade, particularly in relation to Halal-certified agri-food, encouraging investments in sectors such as energy, advanced technology, and heavy industry, fostering cooperation in terms of digital transformation and telecommunications, and promoting sustainable, quality-driven tourism and labour initiatives.

The three key tasks comprise continuously refining legal and policy frameworks, boosting market information and opportunity sharing, and efficiently organising trade, investment, and tourism promotional activities in each country.

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By Celine Luu

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