Scope outlined for Cuba cooperation

Vietnamese Party General Secretary, State President To Lam (left) and Cuba’s First Secretary of the Communist Party and President Miguel Diaz-Canel Bermudez for bilateral talks last week

During a state visit to Cuba last week by Party General Secretary, State President To Lam, both countries pledged to apply new mechanisms to amplify bilateral trade and investment ties.

The Vietnamese leader and Miguel Diaz-Canel Bermudez, First Secretary of the Communist Party of Cuba and President, visited the Mariel Special Development Zone (ZEDM), the first free trade and export processing zone of Cuba.

The ZEDM offers opportunities in various sectors, including biotechnology, pharma research and production, packaging, renewable energy, agriculture and food, IT and communications, tourism, real estate, and infrastructure development.

Currently, Vietnamese companies have five operational projects in Cuba, including four in the ZEDM and one for building materials in Santa Cruz and San Jose.

Last week at the ViMariel Industrial Park backed by a member of Vietnamese group Viglacera, Vietnamese companies Thai Binh Global Investment and ATG Fertiliser were licensed to produce hygienic sanitary products and fertiliser products respectively.

Vietnamese Deputy Prime Minister and Minister of Foreign Affairs Bui Thanh Son told Cuban Minister of Foreign Affairs Bruno Rodríguez that Vietnam stands ready to expand bilateral cooperation in healthcare, pharmacy, tourism, agriculture, energy, and construction. Vietnam is also ready to share experiences in the sectors needed by Cuba, he added.

According to Cuban Ambassador to Vietnam Orlando Nicolas Hernandez Guillen, Vietnam has become an important partner in Cuba’s strategy on opening its economy.

“Vietnam is the largest Asian foreign investor, and the second-largest Asian trade partner in Cuba. We hope that there will be new investments in Cuba from Vietnam, further strengthening these achievements,” Guillen said.

In the first eight months of this year, two-way trade turnover reached $134.7 million, up 187 per cent on-year. This included $133.36 million of Vietnam’s exports, up 184.3 per cent on-year, and $1.33 million of Cuba’s exports, up 10 per cent.

Vietnam’s key exports to Cuba include rice, coffee, chemicals, textiles and garments, footwear, computers, construction materials, and machinery. Vietnam’s main imports from Cuba are vaccines and pharmaceuticals. Last week both nations agreed to find solutions to reach a bilateral trade turnover of $500 million over the next five years.

The Vietnam-Cuba Trade Agreement, which took effect in 2020, was the first that Cuba signed with an Asian country. Under the agreement, most tax lines in bilateral trade exchanges shall be removed or reduced under roadmaps.

According to the Department for European and American Markets under the Ministry of Industry and Trade, to exploit the Cuban market’s potential and effectively capitalise on the agreement’s commitments, importers and exporters should pay attention to the advantages and disadvantages when doing business in this market. The cooperation mechanism of the Vietnam-Cuba Intergovernmental Committee and other legal frameworks between the two are relatively complete to create momentum for the development of relations and cooperation in all fields.

In the coming time, the department said, the Cuban market will continue to need imported goods because domestic manufacturing industries remain underdeveloped, meaning an opportunity for traditional Vietnamese goods to enter Cuba.

However, the department stressed, the geographical distance between Vietnam and Cuba increases transportation costs and prolongs transportation time. In addition, difficulties related to Cuba’s ability to pay and supply energy are also challenges for Vietnamese enterprises in doing business in this market.

Cuba was the first Latin American country to establish diplomatic relations with Vietnam, in 1960. Next year will mark the 65th anniversary of the establishment of the relations.

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