Vietnam News Today (Oct. 13): Vietnam, India Hold Huge Potential to Expand Trade

200 naval officers and crewmembers of Helicopter frigate HMAS Toowoomba of Royal Australian Navy (RAN) arrived in Ho Chi Minh City on October 12 on a goodwill visit to Vietnam. (Photo: VNA)

Royal Australian Navy warship HMAS Toowoomba visits HCM City

Helicopter frigate HMAS Toowoomba of Royal Australian Navy (RAN) docked at Ho Chi Minh City’s Nha Rong wharf on October 12 on a goodwill visit to Vietnam.

During their six-day stay, 200 naval officers and crewmembers will have exchanges and share experiences with officers and sailors of the Vietnam People's Navy, in such fields as health care on naval ships and rescue work.

The Australian crew will also pay a courtesy visit to leaders of the Ho Chi Minh City People's Committee, the Military Region 7 High Command, and the Naval Region 2 High Command, and lay floral tributes at the monument to President Ho Chi Minh.

Besides Australian sailors will participate in friendly sports games with students of the Naval Technical Intermediate School, cited VOV.

Commander Tony McCormack of Indo-Pacific Endeavor (IPE) said the visit, part of the IPE cooperation program, aims to promote friendship and mutual understanding, contributing to further strengthening cooperation between the two countries' navies and Vietnam-Australia defense cooperation.

The visit also demonstrates the strong strategic partnership between Vietnam and Australia in celebration of half a century of diplomatic relations between Vietnam and Australia (1973-2023).

HMAS Toowoomba is the seventh of eight Anzac Class frigates built by Tenix Defence Systems at Williamstown, Victoria for the Royal Australian Navy. The design is based on the German Meko 200 frigate.

The warship features a "combined diesel or gas" (CODOG) propulsion plant which enables the ship to sustain sprint speeds of greater than 27 knots and allows an operational range in excess of 6,000 nautical miles at 18 knots.

The ship can embark Navy's latest multi-role Sikorsky/Lockheed Martin MH-60R Seahawk helicopter which has enhanced anti-submarine, anti-surface warfare and Search and Rescue capabilities. Embarkation of a helicopter also provides the ship with the capability to deliver air-launched missiles and torpedoes, according to the Royal Australian Navy (RAN).

Vietnam, India hold huge potential to expand trade: Diplomat

Vietnam and India boast huge potential to further foster cooperation in trade and investment as both sides have many young and proactive businessmen who are able to create wonderful business opportunities between the two countries, the Vietnamese General Consul in Mumbai Le Quang Bien has said.

Attending a ceremony to mark the 84th founding anniversary of the Southern Gujarat Chamber of Commerce and Industry (SGCCI) on October 11, Bien stressed that India, with rapid growth and on the way to becoming a 5-trillion-USD economy by 2027, has been a potential and trustworthy business partner of Vietnam.

Vietnam always treasures trade cooperation as well as cultural and people-to-people exchanges with India, he said, adding many destinations in the Southeast Asian country have been chosen by Indians to organize weddings, including Phu Quoc island, according to VNA.

Vietnam and India boast huge potential to further foster cooperation in trade and investment. (Photo: VNA)

He laid stress on the necessity to open a direct route between Surat port city of Gujarat state and Vietnam to facilitate travel and trade between the two nations.

Bien hailed the SGCCI’s Global Connect Mission 84, which aims to promote India’s trade ties with 84 countries worldwide and envisages to connect some 84,000 young and talented businessmen from India and those countries.

He described the initiative as an innovative endeavor that is different from conventional approaches, adding entrepreneurs under the initiative, including Vietnamese, will have opportunities to enhance trade ties with Indian businessmen and the global business community.

Chairman of the International Entrepreneurs Connection Club Dinh Vinh Cuong spoke highly of the cooperation between Vietnamese businessmen and industrial producers in Surat, thus he wants to work with the SGCCI to create favorable conditions to connect their members.

On this occasion, a Memorandum of Understanding was signed between the International Entrepreneurs Connection Club and the SGCCI.

With its stable socio-political situation, dynamic economy, young human resources, and strategic position in the global supply chain, Vietnam is an ideal partner for India in the fields of investment, trade, cultural exchange and tourism.

Vietnam remains an outperformer in FDI attraction across Southeast Asia: HSBC

While foreign direct investment (FDI) has fallen from its 2017 peak partly due to tighter global monetary conditions, Vietnam remains an outperformer in ASEAN in attracting FDI, second only to Malaysia, according to HSBC’s report “Vietnam at a glance”.

The report outlines that despite near-term cyclical challenges to trade, the country’s long-term FDI prospects appear intact. Its manufacturing sector accounts for the bulk of FDI, offering hope that it can climb up the value chain, paving the way for a robust rebound when the trade tide eventually turns. New FDI continues to pour into the manufacturing space, with the figure so far this year already exceeding the total recorded in each of the past three years.

Furthermore, tech supply chain relocation was one of the main focuses of United States President Joe Biden’s visit to Vietnam in September as the two countries moved to elevate their relationship to that of a comprehensive strategic partnership. President Biden announced that US tech companies, including Amkor and Marvell, plan to invest in the Vietnamese market.

A few weeks later Hana Micron of the Republic of Korea joined in by announcing an expansion of its chip production with a US$1billion investment by 2025.

Green shoots in trade

After a challenging first half of the year, the Vietnamese economy recovered at a stronger-than-expected pace of 5.3% in the third quarter.

This can largely be put down to some reprieve in the trade sector, with September marking the first month of annual growth in exports. In particular, China’s surging demand for agricultural products has put a floor under Vietnamese exports, although it is unable to reverse the still-sluggish demand from the US and the EU.

Along with manufacturing, the country’s booming tourism sector is the bedrock of its services, prompting the Government to raise its annual tourism target.

“The biggest surprise to us is the rebound in Vietnam’s manufacturing sector. While it is still too early, in our view, to call a material recovery in the global trade cycle, Vietnam’s trade sector has had a much-needed reprieve recently,” according to HSBC experts.

However due to base effects, exports saw their first growth in more than six months, reducing the severity of export falls from double-digits in the first half of the year to less than 2% year on year in the third quarter of the year. While export weakness remains largely broad-based, decent growth in both computer and agriculture shipments offsets some risks.

This trend is also reflected in Vietnamese shipments to major trading partners. While exports to the US, a 30% share of the total, and the EU, a 15% share, have yet to see a turnaround, they have halted further deterioration.

Meanwhile, Vietnamese exports to China, a 15% share, saw double-digit growth sequentially, largely thanks to the impressive growth recorded in agriculture products, VOV reported.

Photo: VOV

Outside of manufacturing, services remain the bedrock of Vietnamese growth. Overall, the sector which has enjoyed close to 10% year-on-year growth is tourism-related.

Think tanks stressed that ASEAN has seen a return of tourists to around 60% to 80% of 2019’s levels, with Vietnam’s recovery pace approaching 70% in September. The country welcomed 8.9 million tourists as of September, prompting authorities to upgrade its full-year target to 13 million from the previous figure of eight million.

New forecasts

However, experts revealed that upside risks to inflation have resurfaced, making them upgrade the year’s average inflation forecast to 3.4%

HSBC economists also kept their annual growth forecast at 5.0%, although they now expect the State Bank of Vietnam to hold its policy rate steady at 4.50% until end-2024.

CN Traveler names Phu Quoc among world’s top island

Boasting long beaches with gleaming white sand lying serenely along inviting turquoise waters, Phu Quoc island off the Mekong Delta province of Kien Giang has been honored by the American travel magazine Condé Nast Traveler (CN Traveler) as one of the world’s top islands in 2023.

CN Traveler unveiled the Readers’ Choice Awards 2023 on October 3, with Phu Quoc making it to the list for the second consecutive year.

The Vietnamese island secured a spot in the Asian island category, ranking 8th with 88.89 points. It was followed by Japan’s Okinawa & Ryuku islands and the Philippinies’ Siargao island.

In 2015, Condé Nast Traveler’s readers voted Phu Quoc’s Sao Beach as one of the ten pristine and tranquil beaches in the world, alongside other renowned destinations such as Fiji and Maldives.

Besides stunning landscapes, Pearl Island is among the most alluring destinations in Vietnam, owing to a kaleidoscope of cultural-historical experiences, and various kinds of accommodations – from affordable housing to luxurious resorts that it has offered.

The poetic beauty of Sao beach on Phu Quoc island. (Photo: Sun Group)

Foreign media has praised Phu Quoc as a “rising star” in the global tourism map thanks to its radical changes to attract visitors. Charming Sunset Town, which was recently put into operation in the southern part of the island, has been hailed by Yonhap News of the Republic of Korea as it offers visitors a unique experience to enjoy the Mediterranean beauty in a tropical nation. Meanwhile, Traveller magazine of Australia affirmed that every corner of Sunset Town will amaze visitors.

The iconic attractions of Phu Quoc include the Hon Thom cable car - the longest 3-rope cable car system in the world that takes tourists from the center of An Thoi town to Hon Thom island, and Kiss The Stars – Asia’s largest show of multimedia technology on water.

Besides, a visit to pepper farms, pearl farms, Ham Ninh fishing village or Phu Quoc National Park, and a try of local food such as “bun quay” (vermicelli with fish cake, shrimp cake, squid and beef) will help travelers get a deeper insight into local culture, cited VNA.

Yonhap News also called Phu Quoc “Vietnam’s Maldives” as the island houses an array of top-notch resorts that meet the requirements of the most fastidious travelers seeking exquisite accommodations, including JW Marriot Phu Quoc Emerald Bay Resort, Premier Residences Phu Quoc Emerald, New World Phu Quoc Resort and Premier Village Phu Quoc Resort.

Being honored by CN Traveler as among the world’s top islands for the second year in a row, Phu Quoc has affirmed its position in global tourism. Its recognition on the world travel map has been rapidly increasing. From an unknown island, Phu Quoc has become the apple in the eyes of travel aficionados as it has been praised by prestigious magazines and tourism organizations.

Vietnam, a potential global transit hub

Cushman & Wakefield experts said Vietnam has the potential to compete with global logistics hubs such as Dubai (United Arab Emirates) and Hong Kong (China), and even with Singapore and Shanghai (China).

With the growth of e-commerce, Vietnam has become a destination for many manufacturing and logistics firms, creating a strong demand for high-quality logistics real estate, said the CEO of Cushman & Wakefield Trang Bui.

Trang said the total warehouse supply in Hanoi and HCM City is only around 2.02 million sq.m and 5.13 million sq.m, respectively. Industrial parks and logistics facilities in major urban areas, especially in the two cities, are experiencing high occupancy rates with some reaching nearly 100 percent. The demand for warehouse space is expected to continue growing.

She said Vietnam is strategically located next to the economic corridor in southern China, which includes prominent regions such as Shanghai, Shenzhen, Fuzhou, and Guangdong, chosen as the headquarters of major industrial, chemical, trade, and electronic technology companies. Vietnam's industrial parks welcomed investment from global electronics companies early on, such as Panasonic (1971), LG Display (1995), Canon (2001), Foxconn (2007), Samsung (2008), Fuji Xerox (2013), and more recently conglomerates like Pegatron, Goertek and Jinko Solar. Vietnam is currently presented with the opportunity to elevate the value of the manufacturing supply chain.

According to the Ministry of Transport, Vietnam has a total road length of 595,201 kilometers, with 25,560 kilometers designated as national highways. The expressway network has been expanded to 1,239 kilometers, with roughly 14 new routes and sections under construction, equivalent to 840 kilometers.

The national railway network spans 3,143 kilometers, with 277 stations and two routes linking with China from Dong Dang and Lao Cai. The northern region has road, waterway, and rail routes directly to Shenzhen, known as China's Silicon Valley, making it easier for enterprises to expand and allocate production in the area, VNS reported.

Goods loaded at Dinh Vu Port in the northern city of Hai Phong. Recent significant investments in Vietnam's seaport system have established modern facilities that meet international standards. Photo: VNA

Vietnam's seaport system has received significant investments in recent years, with modern facilities that meet international standards, notably Hai Phong and HCM City container ports being among the 50 largest in the world. The seaport system comprises 286 port berths, with a total quay length of over 96 kilometers.

For the first time, shipping companies have been able to provide direct services from Vietnam to North America and Europe without the need for transshipment through regional hubs like Singapore or Hong Kong (China), saving some US$150-300 per TEU for containers to and from Vietnam.

The Vietnamese Government has targeted meeting demand for export-import, trade between regions and areas nationwide, as well as cargo transit and passenger transport both domestically and internationally by 2030.

Cushman & Wakefield experts said Vietnam had the potential to compete with global logistics hubs such as Dubai (United Arab Emirates) and Hong Kong (China), and even with Singapore and Shanghai (China), aspiring not only to become a global cargo transit hub but also a vital link in the global manufacturing supply chain.

In the first eight months of this year, the total FDI poured into Vietnam hit nearly US$18.15 billion, up 8.2 percent year on year.

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