Vietnam-Thailand Cooperation Grasping Opportunities from AEC

Ms Malinee Harnbongsong, Commercial Consul and Director of the Thai Trade Centre under the Royal Thai Consulate General in Ho Chi Minh City, said the fine friendly relations between Vietnam and Thailand have been lifted to a strategic partnership not only in trade and investment cooperation but also in new areas like education, health and tourism. Vietnam and Thailand have similar industries. Both are leading rice exporters in the world and they need to assist each other for joint development. She stressed, "Given global and regional economic uncertainties, the strengthened bilateral cooperation will be the basis for linking with other countries in the region and the world, overcome difficulties together and actively supporting each other in economic development. In particular, the scheduled formation of the ASEAN Economic Community (AEC) on December 31, 2015 will leverage to strengthen cooperation connectivity, share experience and resources, and boost joint development while providing huge opportunities for the business communities of the two nations to tap the potential ASEAN market with 600 million consumers.”

 

Mr Tharabodee Serng Adichaiwit, Senior Vice President and General Manager of HCM City Branch - Bangkok Bank, said, with a population of over 90 million, Vietnam is one of the large potential markets in ASEAN. The appeal of the Vietnamese market comes from an open investment and business environment with a lot of attractive incentives, a highly skilled young labour force, low labour costs, low production costs, clearly defined personal and corporate income taxes. Speaking highly of political stability, diverse resources and hugely potential market development in Vietnam, he acknowledged that Vietnam will be a top destination of international businesses and investors in a few years to come. Catching this opportunity, Thai companies may speed up their investment and business operations in Vietnam by various modes like entering joint ventures, opening representative offices, and building factories and workshops in industrial zones and export processing zones. If they set the firm foundation in Vietnam, they will have the opportunity to expand cooperation with many big names in the world which have been, and will be, investing in the country.

 

Investment is a bright spot in the bilateral cooperation ties. Thailand is the 10^th largest foreign investor in Vietnam with 270 projects and US$6.6 billion. Particularly, on trade, Thailand is the largest trade partner of Vietnam in Southeast Asia, with the bilateral trade value grossing US$10.6 billion in 2014, an increase of 12.5 percent over 2013. In the first five months of 2015 alone, in spite of difficult economic difficulties, the two-way trade turnover approximated US$4.4 billion. Currently, both countries are "holding hands" each other to balance trade and bring the value to US$15 billion in 2020. Meanwhile, the two countries are actively coordinating with other ASEAN countries to carry out ASEAN commitments in 2015 as well as free trade commitments with non-ASEAN partners.

 

Mr Nguyen The Hung, Deputy Director of VCCI - HCM, said, with their constant investment and business expansion to foreign countries, Thai companies have confirmed their class and dynamism in ASEAN. Therefore, Vietnamese enterprises need to actively strengthen contacts and meetings and exchange experiences with Thai firms, take part in trade and investment promotion delegations of Thailand to enhance their competitiveness and broaden penetration into the Thai market in particular and ASEAN in general and reach out to global markets.

 

He added that the AEC will leverage strong changes in investment, trade and service; promote capital turnover and modern technology transfer. Therefore, the business communities of Vietnam and Thailand need to have best preparations to effectively utilise investment and trade opportunities, thereby helping lift the bilateral cooperation ties to a new high.