The business matchmaking seminar between Vietnamese and Indonesian enterprises in Jakarta.

Vietnam – Indonesia economic ties a bright spot amid impressive growth

With the world facing plenty of challenges caused by the aftermath of COVID-19 pandemic coupled with growing geopolitical competition in the region, Vietnam-Indonesia economic links are considered to be a bright spot with impressive growth figures, steadily overcoming the headwinds of the global economy.

Continuously surpassing milestones

The sound political relations that have always been maintained and nurtured on the basis of time-tested traditional friendship in recent years, especially after the two countries entered the post COVID-19 recovery period. Indeed, economic and trade ties between the two countries have achieved impressive growth, continuously surpassing new milestones and moving in a more balanced direction.

Bilateral trade turnover increased from US$8.20 billion in 2020 to US$14.17 billion in 2022, with Indonesia becoming the third largest export market and the second largest import market of Vietnam in ASEAN in 2023. In particular, the investment sector has seen numerous improvements.

By the end of November, 2023, Indonesia’s total investment capital in the Vietnamese market had reached US$651.21 million, with 120 valid projects, marking an increase of two projects with an additional capital of US$4.71 million in 2023 to rank 29 out of 143 territories with investment capital in the nation.

Many Indonesian groups and companies are investing and conducting business successfully in the country such as Ciputra, Traveloka, Gojek, PT Vietmindo Energitama, Jafpa Comfeed Vietnam, and Semen Indonesia Group, cited VOV.

According to Ciputra Group Managing Director Budiarsa, the nation currently has huge potential for investment as it has a fairly large population compared to others in ASEAN. The nation has also seen stable economic development in recent times, becoming the fastest growing economy in the regional bloc, he said, adding that Ciputra is also considering new investment co-operation projects in the Vietnamese market.

In the opposite direction, a number of major Vietnamese businesses and groups already have a presence in Indonesia, while other firms are also completing investment procedures in this market.

Most notable is Vinfast Global's project with a total estimated investment capital of US$1.2 billion to build an electric vehicle factory in Indonesia with a capacity of 50,000 vehicles annually. Construction work on the facility is expected to start in the first quarter of 2024 and will be completed in 2026.

With potential and strengths, both countries' leaders have agreed to bring two-way trade to reach the target of US$15 billion by 2028. Vietnamese Ambassador to Indonesia Ta Van Thong has expressed his complete optimism about this goal.

“The set target is based on the determination of the two governments and the potential of both sides. The population of both nations accounts for 60% of ASEAN's population with a total of nearly 400 million people. Vietnam and Indonesia are both members of the ASEAN Free Trade Area (AFTA) and the Regional Comprehensive Economic Partnership (RCEP) so they have many advantages to increase two-way trade. Amid the global trade economy continuing to face plenty of difficulties, bilateral trade continues to be a bright spot with a growth rate of about 10% per year. Therefore, the ability to reach the target of US$15 billion is a very realistic prospect in the next few years," Ambassador Thong assessed.

Vice Chairwoman of the Indonesian Chamber of Commerce and Industry (KADIN) Shinta Widjaja Kamdani also expressed her confidence that the bilateral turnover target of US$15 billion by 2028 is completely achievable. However, there remains a lot of work that both sides need to do in order to optimise bilateral trade, especially when both countries are members of ASEAN.

The two governments need to continue to connect and offer optimal conditions in which enterprises can intensify their operations, she went on to say.

To further enhance two-way trade, both parties are in the process of co-ordinating with each other to convene the eighth Joint Economic and Trade Committee soon with a view to proposing measures to bolster economic and trade ties.

Exploring new areas of co-operation

Currently, one of the prominent trends in the world is to strengthen linkages on climate change response. In the process of implementing international commitments, the two countries can co-operate closely in the fields of energy conversion, carbon storage, renewable energy development, green energy, and sustainable green economic development.

Arsjad Rasjid, former president of KADIN, highlighted the field of green energy, specifically electric vehicles, as a potential area to develop collaboration between the two countries.

He said he believes that the two side can foster links to create synergy in the production of batteries and components. Indonesia also has many fields that they can invite Vietnam to co-operate in moving forward.

Under the impact of climate change, food security is becoming a great concern for many countries, especially countries with big populations such as Indonesia and Vietnam.

Both nations boast complementary strengths in long-standing production and resources for agriculture and fisheries, thereby helping to create a complete value chain.

The two sides need to make greater efforts in a bid to promote existing mechanisms in ASEAN, while also studying the signing of a new agricultural co-operation agreement under which, specific collaboration projects to develop livelihoods for farmers can be carried out to ensure food security, whilst also promoting the trade and economic development of each nation.

Regarding rice products, the Vietnamese side is always in the top three rice suppliers to the Indonesian market. As of November, 2023, the country has shipped more than 1.1 million tonnes of rice to Indonesia, worth more than US$600 million.

Regarding seafood and fisheries, the two sides continue to promote recent exchanges on commodity groups such as lobster, tuna, and seaweed, as well as stepping up ties between businesses, associations, and fishermen of the two countries to develop fisheries in a sustainable way.

Tourism is also a potential field in which to promote ties between the two sides based on the natural landscape and tourism economy that is on the path to recovery and strong development.

Along with restoring direct flights after a period of disruption, in 2023 VietJet Air opened more new routes, including Ho Chi Minh City - Jakarta and Hanoi - Jakarta. This is a favorable condition for the two sides to work together in developing signature tourism products, connecting destinations, while also improving and creating new eco-friendly tourism products.

Amid the challenging and unpredictable global economic context of 2023, the fact that both sides maintained growth rates and strong bilateral economic relations is impressive. This is important not only for each country itself, but also contributes to improving the economic resilience of ASEAN as a whole to withstand fluctuations and unfavorable external impacts.

Indonesian President Joko Widodo's state visit to Vietnam from January 11 to January 13 is considered to be an impetus in elevating the relationship to a new level across multiple areas, including bilateral economic and trade co-operation.

Australian Ambassador optimistic about cooperation potential with Vietnam

2023 marked the 50th anniversary of Vietnam-Australia diplomatic ties (1973-2023). In the past half a century, the two countries have cooperated in an increasingly extensive, intensive, and effective manner in multiple spheres. They will continue to expand cooperative ties through various projects in the future.

Ambassador Goledzinowski also shared his views on Vietnam’s diplomatic achievements over the past year, saying that 2023 was a “big year” for the country.

“It’s been particularly because of the 50th anniversary, there has been a huge number of visitors to Vietnam, which also reflects the importance of Vietnam. Vietnam is emerging as one of the most important countries in Asia and in the world,” he noted.

The Ambassador cited visits by high-ranking Australian officials to Vietnam last year, including the Governor-General, Prime Minister, Foreign Minister, Trade Minister, and Defense Minister.

“We also know that Vietnam elevated its bilateral relationship with some very important countries, Korea, Japan and the United States, which I think was an important statement of Vietnam’s perspective on the world,” said the Ambassador.

He went on to mention the visit by the Chinese President to Vietnam, saying that China will always be an important country for Vietnam due to economic, cultural, historical, and geographical reasons, according to VNA.

He spoke highly of Vietnam’s foreign policy of diversifying its relationships and building resilience in the national interest. The Ambassador also expressed optimism about the prospects for Vietnam-Australia diplomatic ties to be elevated to a comprehensive strategic partnership in 2024.

According to Ambassador Goledzinowski, one year after the two countries forged bilateral relations in 1973, the first Vietnamese students came to Australia on scholarships, and Australia became one of the earliest investors in Vietnam.

Photo: Australian Ambassador to Vietnam Andrew Goledzinowski. (Photo: VNA)

“We built the first bridges over the Mekong, the first university was RMIT, the first law firm, the first bank, the first ATMs, the first telecommunications links were put in place by Australian companies. So that was really good. We’re looking forward to strengthening our investment profile here even more,” the Ambassador said.

He also revealed that the Embassy will recruit five new staff members in Ho Chi Minh City and two new staff members in Hanoi with the specific aim of increasing Australian investment in Vietnam.

“That’s new and it’s very important. And there are a few areas where we particularly want to focus,” he continued.

“I’m speaking with the Education Minister about making some adjustments to ensure that Vietnam is an attractive place for education investment. Because I would like to see more Australian universities come to Vietnam to establish themselves,” the Ambassador added.

Ambassador Goledzinowski told VNA about two more potential fields of cooperation - mining and telecommunications.

The Australian side has been working with the Ministry of Natural Resources and Environment to share its knowledge and support Vietnam in reviewing its mining law, as mining is a major industry in Australia and boasts “incredible potential for wealth to be created” in Vietnam. Australia also expects to help Vietnam in building “trusted cables that connect Vietnam to the world,” he said.

Another pillar of cooperation in bilateral ties he mentioned was “green energy transition”, a field that has been increasingly intensified between Australia and Vietnam in recent times.

“When my Prime Minister was here in Vietnam in June, he announced a new partnership worth 105 million AUD, which we’re calling ‘Aus for growth’. But it will largely be around the green energy transition to assist in Vietnam’s efforts to make sure that your supply chains are green, because that’s what will be necessary to trade in the future economy,” said Ambassador Goledzinowski.

He also cited the Australian Foreign Minister Penny Wong’s trip to Vietnam in August, where she announced 95 million AUD for climate change adaptation and particularly for the Mekong Delta region.

“I was down there a week or two ago and the Mekong faces very particular challenges. And so we hope that that project will help to ease the transition to sustainable economic models in the Mekong area,” the Ambassador said.

According to him, Australian companies are interested in working with Vietnam in this field. Specifically, he mentioned one Australian company that is “very keen to build offshore wind farms” because “Vietnam is very prospective for offshore wind in particular.”

Solutions for Vietnamese economy to overcome headwinds

Extending economic policies, finding fresh directions for exports, and promoting domestic consumption are the solutions that exist for the nation to overcome "headwinds", according to information given by economic experts.

According to Associate Professor. Dr. Nguyen Duc Trung, rector of Ho Chi Minh City University of Banking (HUB), to achieve its growth target of 6% to 6.5% for the year, the nation needs to work out overall solutions, such as promoting domestic consumption, maintaining and extending economic policies, and finding new directions for exports.

​Consumption promotion therefore requires intensifying trade promotion activities, replicating livestream sales models like in Ho Chi Minh City, whilst also strengthening online shopping and entertainment festivals.

Furthermore, it remains necessary to maintain and extend the 2% value added tax (VAT) reduction not only for six months. Exports need to be directed more strongly towards positive markets such as India, as opposed to just focusing on Europe, Trung emphasized.

In terms of investment, it can be considered essential to change the public investment model to ensure stability, while striving to increase the disbursement rate of public investment capital to 85% to 90%, reported VOV.

Photo: VOV

​With Ho Chi Minh City being the country’s leading economy, economic expert Dr. Vo Tri Thanh believes that moving forward there will still be numerous difficulties and challenges moving forward, meaning the southern metropolis needs to make good use of the foundation and growth momentum in 2023 to respond to headwinds.

Ho Chi Minh City's growth momentum will be the adoption of regional planning and national planning whilst competently applying Resolution 98 whilst piloting a number of specific mechanisms and policies for the city’s development. Furthermore, the southern city has the opportunity to transition to a green economy, a digital economy, and promote innovation in order to attract large, high-quality corporations.

“It is imperative to prepare quality human resources for the city and the whole nation. Apart from infrastructure and planning, the crucial role is to ensure quality human resources to meet new requirements, especially according to new investment trends," Dr. Thanh analyzed.

Nguyen Anh Tuan, head of the Ho Chi Minh City Enterprise Management Innovation Board, said that Ho Chi Minh City requires a breakthrough solution to have shortened mechanisms and policies because currently, investment procedures, whether small projects, also double the implementation time.

According to him, being too cautious causes the capital cycle to run slowly, thereby impacting on development.

Therefore, there needs to be a breakthrough and removal of those obstacles as a way of boosting exports to activate the economy in the coming time, he added.

Nearly 2,000 night flights to be operated during Lunar New Year holiday

More than 1,800 night flights, equivalent to 8% of the total number of domestic flights, will be operated from January 21 to February 25 to meet the increasing travel demand during the Lunar New Year (Tet) holiday.

The Civil Aviation Authority of Vietnam (CAAV) issued a document allowing night flights during the Tet holiday, and asked carriers to take actions to minimize flight delays and cancellations, and to intensify control to ensure aviation safety.

Local airports, especially the Dong Hoi, Phu Cat, Chu Lai, Tuy Hoa, Tho Xuan, Vinh, and Pleiku, were urged to develop specific plans and measures to ensure the capacity to provide services during the holiday and ensure sufficient resources, equipment and infrastructure facilities to serve flights following airline's operation plans.

Domestic airlines are requested to proactively and timely provide accurate information about their demand for operating night flights to aviation service providers to ensure the quality of air services, VNA reported.

Illustrative image (Photo: VNA)

Bamboo Airways said it has just added one more Airbus A320 aircraft to its fleet. As planned, another will be added to the firm’s fleet from the middle of January.

It plans to increase its capacity by over 20% during peak times, focusing on increasing the frequency of flights on major routes such as Hanoi - Ho Chi Minh City, between Hanoi/HCM City and Da Nang, and those with high demand such as HCM City - Vinh/Thanh Hoa/Hai Phong. Additionally, the airline will also increase night flights on the routes connecting HCM City with Hanoi, Vinh, and Da Nang.

Similarly, Vietjet has also added four more aircraft to its fleet, lifting the total aircraft of the firm to 103.

The CAAV has estimated that the domestic air carriers will operate about 33,800 flights during the Lunar New Year (Tet) holiday, or between January 24 and February 2, up 14% year-on-year and 21% as compared with normal days.

There will be some 24,200 domestic flights, representing an increase of 2% from the same period last year; and 9,600 international flights, up 60% year-on-year.

The busiest routes include Hanoi-Ho Chi Minh City, HCM City-Da Nang/Vinh/Dong Hoi/Quy Nhon/Chu Lai/Thanh Hoa/Hue/Tuy Hoa, and Can Tho-Vinh, and vice versa.

The airlines expect to fly 7.2 million passengers during Tet, the biggest holiday in the year in Vietnam, of them more than 5 million domestic ones, up 4% year-on-year.

Vietnamese animation company sets two records in film copyrights

The Vietnamese animation studio Sconnect has officially been recognised for two records in the fields of animated film copyrights and multilingual distribution on digital platforms, marking the first time in Vietnam that records have been established in the realm of animated films.

The Vietnam Records Organization (Vietkings) presented Sconnect Vietnam the two records for the most copyrights related to Vietnamese animated films (127 copyrights) and for Wolfoo - Vietnamese animated film with the most multilingual releases on the YouTube platform.

Vietnamese animation company sets two records in film copyrights: Wolfoo, a long-running animated series, is the flagship IP of the company. (Photo: Sconnect Vietnam)

According to Pham Thi Quyen, Vice Chairwoman of the Digital Content Creation Alliance (DCCA), these pioneering records can serve as a catalyst for individuals and entities to continue striving for greater values in the Vietnamese animation sector and in digital content.

As per information from the organizing committee, Sconnect Vietnam, established in 2014, is active in the production and business of content services spanning various aspects of life on online platforms. Leveraging diverse technologies in animation production, it currently owns 13 animated intellectual properties (IPs) and an ecosystem of over 15,000 channels, cited WVR.

Wolfoo, a long-running animated series, is the flagship IP of the company. Officially released globally in mid-2018, Woolfoo now has 3,700 episodes ranging from 3 to 5 minutes in length and translated into 17 languages. After nearly five years, it has garnered some 100 million regular YouTube subscribers and accumulated over 41 billion views across the entire channel network.

Vietnam News Today (Jan. 8): Vietnam Treasures Bilateral Relations With Cambodia Vietnam News Today (Jan. 8): Lao media spotlights Vietnam – Laos special relations; Hoi An, Hanoi, and Ho Chi Minh City win Travelers’ Choice Best ...

Vietnam News Today (Jan. 9): 2023 a Successful Year of Vietnam’s Cultural Diplomacy at UNESCO Vietnam News Today (Jan. 9): 2023 a successful year of Vietnam’s cultural diplomacy at UNESCO; Two more cold air waves to hit Vietnam in January; ...

Vietnam News Today (Jan. 10): 2024 Expected to be Good Year For Domestic Tourism Vietnam News Today (Jan. 10): Vietnam – Bangladesh friendship brings practical benefits: Bangladeshi PM; Vietnamese Pho named among world’s 20 best soups; 2024 expected to ...