Vietnam, Singapore Uplifting Cooperation

The relationship between Vietnam and Singapore has been constantly developed during the past 42 years, covering many areas of cooperation such as economics, politics, defence, education, health, arts and culture. The fine political relationship is the foundation for their steadily growing economic cooperation. Singapore is one of the biggest investors and trading partners of Vietnam.

 

Vietnam and Singapore established diplomatic relations on August 1, 1973. The Vietnam Embassy in Singapore was opened in December 1991and the Singapore Embassy in Hanoi was inaugurated in September 1992.

 

According to statistics, trade turnover between Vietnam and Singapore reached US$9.32 billion in 2015, down 4.7 per cent over 2014, of which Vietnam earned US$3.28 billion from exports to company, up 11.6 per cent and spent US$6.03 billion on imports from Singapore, down 11.7 per cent.

 

Vietnam's major exports to Singapore include crude oil; computers, electronic products and components; machinery, equipment, tools and spare parts; vehicles and spare parts; telephones and components; pepper; coffee; seafood; and apparels.

 

Meanwhile, its imports from Singapore are mainly petroleum products; computers, electronic products and components; plastic materials; machinery, equipment and spare parts; perfumes, cosmetics and sanitary wares.

 

On investment, Singapore ranked third out of 114 countries and territories investing in Vietnam as of April 2016. The nation invested a total of US$36.28 billion in 1,600 valid projects.

 

Singapore's direct investment value in Vietnam has surged. In the first four months of 2016, Singapore had 50 new FDI projects and 23 projects registering to increase their investment capital. Singaporean investors injected US$730 million in the period. Singapore's FDI flowed into 18 out of 21 Vietnam's economic sectors, led by manufacturing and processing industry with 494 projects and US$16.1 billion, accounting for 44.3 per cent of total Singaporean investment in Vietnam. It also invested US$10.9 billion in 81 real estate projects, accounting for 30 per cent of its total investment value in Vietnam.

 

The average size of a Singapore investment project is US$22.7 million, higher than the average of US$13.8 million among FDI projects in Vietnam. Many Singapore-invested projects in Vietnam are operating effectively and contributed greatly to employment, export growth and economic growth in Vietnam.

 

Vietnam - Singapore Industrial Park (VSIP) is a flagship project of Singapore in Vietnam. Currently, Vietnam has seven VSIP industrial parks in six provinces, including Binh Duong, Bac Ninh, Hai Phong, Quang Ngai, Hai Duong and Nghe An. VSIP Nghe An was kicked off in September 2015.

 

Previously, Singaporean investors tended to choose major localities with good socioeconomic infrastructure to locate their projects like Ho Chi Minh City, Hanoi, Hai Phong and Binh Duong. However, in recent years, they have expanded their investment to other provinces such as Nghe An and Thai Nguyen.

 

Singaporean investors have to date invested in 46 out of 63 provinces and cities in Vietnam. Ho Chi Minh City has led the country in drawing Singaporean investment capital with 799 projects and US$9.75 billion, accounting for 26.7 per cent of Singapore’s total registered capital in Vietnam, followed Hanoi with 256 projects and US$4.65 billion, accounting for 12.8 per cent. Quang Nam ranked third with six projects and more than US$4 billion, accounting for 11.3 per cent. Bac Ninh, Dong Nai, Thai Nguyen and Ba Ria - Vung Tau provinces have magnetised Singaporean investment capital in recent years.

 

Tourism is a potential cooperation field for Vietnam and Singapore in the coming time. The two nations waive entry visa for citizens of each other. The Singapore Tourism Board was the international travel agency to open a representative office in Vietnam.

 

With its broad international relationships, Singapore has helped Vietnam train officials in charge of social management, scientific and technical research. According to incomplete statistics, more than 3,000 Vietnamese students are studying at universities, colleges and vocational training institutions in Singapore.

 

Singapore’s investment is present in most economic sectors in Vietnam, ranging from oil and gas exploration and exploitation and industrial manufacturing to agriculture, forestry and seafood processing. Most of Singapore’s investment capital has been channelled into infrastructure, services and real estate. Many Singaporean projects are operating effectively and significantly contributing to employment, export growth and economic growth of Vietnam.

 

Singapore is also a bridge to lead investment capital from third countries to Vietnam. Reportedly, the Singapore Economic Development Board (EDB) is proposing four projects in line with this joint initiative. Singapore is host to thousands of national companies with global networks. Getting connected with Singapore via its existing links with the rest of the world, Vietnam can receive immediate global effects. The close cooperation with Singapore will bring valuable experiences in State management, technological development, scientific application and modern education.