Vietnam Economic News had a conversation with Edlyn Khoo, Centre Director, Ho Chi Minh City, International Enterprise (IE) Singapore, about economic relations between Vietnam and Singapore.
* Data showed that Vietnam enjoyed a trade surplus with Singapore and the two-way trade turnover has significantly increased, especially in early months of 2013. How do you evaluate the potential and opportunities of our cooperation in trade exchange?
Total trade between Singapore and Vietnam rose to reach a record 13 billion USD in 2012, making Singapore Vietnam’s seventh largest trading partner. There is clear potential for further growth. As Vietnam’s economy grows, demand for products and services quality will increase along with the growing middle-class. The expansion in disposable incomes has brought about increased consumer awareness and receptiveness towards foreign brands and correspondingly, an influx of foreign consumer brands into Vietnam over the past few years.
Singapore retailers have also been active in engaging the market to offer more choices to increasingly sophisticated Vietnamese consumers. In January 2013, Singapore company, Charles and Keith, opened its seventh outlet in HCMC. The recent opening of NTUC FairPrice’s Co.opXtra in Ho Chi Minh City, the first hypermarket collaboration between Singaporean and Vietnamese companies will also further familiarise Vietnamese consumers with Singaporean brands.
* However, Vietnam always faces with the big trade deficit with Singapore, particularly in recent two years. What is your assessment of this? In your opinion, what should both countries do to deal with this issue?
Over the past few years, total bilateral trade has seen a steady increase. In 2012, bilateral trade between Vietnam and Singapore rose 5.6 percent year on year to reach 13 billion USD. Some components of Vietnamese imports from Singapore are used for further processing into higher value added products for exports. On a global scale, Vietnam recorded its first trade surplus in two decades last year, enjoying a surplus of 284 million USD or 6.8 percent of GDP in 2012.
The results are driven primarily by the exports of foreign invested enterprises that are bringing a technological boost into Vietnam. Export revenue will continue to grow if strong foreign investment can continue to generate higher-value add. To maintain this momentum, Vietnam must continue to liberalise more its trade and investment regulations and continue to take positive steps towards making the business environment more friendly and conducive for foreign investments. In that regard, it is worthy to note that Singapore is one of the largest investors in Vietnam.
* Regarding to investment, could you share with us the contributions which Singaporean businesses made to Vietnam’s development?
As of August this year, Singapore was the second largest investor in Vietnam with approximately 28.6 billion USD in cumulative investments by more than 1000 firms spread across different sectors. As Vietnam continues to undertake steps to liberalise and develop its economy, there is a broad range of sectors in which Singapore companies can partner Vietnam’s growth needs, including urban solutions, consumer-related retail and food services, food processing, logistic, telecommunications as well as tourism and hospitality.
The urban population in Vietnam’s key cities is expected to grow exponentially over the next decade and Singapore is especially keen to share our experience in urban planning and water treatment. These are areas that we have strong expertise in given our own physical constraints and development experience. Singapore companies in the construction, energy, utilities and engineering sectors can tailor customised solutions to meet the needs of key industries across Vietnam.
The Vietnam-Singapore Industrial Parks (VSIPs) serve as good examples of our partnership. The first VSIP established in 1996 was based on a pure industrial model, but this has evolved, across subsequent VSIP projects, to become an integrated industrial township model encompassing the elements of “work, live, and play”.
To date, the VSIPs have attracted over 490 companies and employing over 140,000 workers. Ascendas has also completed the first phase of infrastructural development for the Ascendas-Protrade Singapore Tech Park (APSTP), a project to develop a next generation 500-ha industrial park in Binh Duong Province. In addition, Singapore real estate developer Mapletree has partnered with Saigon Co-op Investment Development JSC to develop SC VivoCity, a 64,000 sq.m family-oriented lifestyle destination mall in Ho Chi Minh City while Keppel Land will develop Phase 2 of Saigon Centre in the heart of Ho Chi Minh City’s District 1, with Takashimaya as the anchor retail tenant.
Singapore firms are cognisant that beyond attracting FDI, it is important to play a responsible role in Vietnam’s sustainable development. The overall benefits of our strong economic relationship include not just financial gains for the firms involved but are also economic and social in nature with tangible returns for the peoples of both sides.
* What has the IE Singapore done to create favourable conditions for Singaporean businesses to invest in Vietnam?
International Enterprise (IE) Singapore is the lead agency under the Singapore Ministry of Trade and Industry promoting international trade and the overseas expansion of Singapore-based companies globally. Our Overseas Centres in Ho Chi Minh City and Hanoi focused on increasing and facilitating business partnerships between Singapore and Vietnam by engaging the two governments as well as enterprises from both sides. IE Singapore raises awareness of the opportunities available in Vietnam for Singapore companies through seminars and business missions and help Singapore firms to build up their market knowledge and competencies before they enter the Vietnam market. Our Overseas Centres help to identify potential projects in areas where Singapore firms have expertise. IE Singapore supports both government-to-government, and government-to-business platforms.
We help Singapore companies establish business connections on the government, enterprise and community levels as well as play an active role in the Singapore-Vietnam Connectivity Framework Agreement to help Singapore companies invest and participate in Vietnam’s growth.-VNA
* Data showed that Vietnam enjoyed a trade surplus with Singapore and the two-way trade turnover has significantly increased, especially in early months of 2013. How do you evaluate the potential and opportunities of our cooperation in trade exchange?
Total trade between Singapore and Vietnam rose to reach a record 13 billion USD in 2012, making Singapore Vietnam’s seventh largest trading partner. There is clear potential for further growth. As Vietnam’s economy grows, demand for products and services quality will increase along with the growing middle-class. The expansion in disposable incomes has brought about increased consumer awareness and receptiveness towards foreign brands and correspondingly, an influx of foreign consumer brands into Vietnam over the past few years.
Singapore retailers have also been active in engaging the market to offer more choices to increasingly sophisticated Vietnamese consumers. In January 2013, Singapore company, Charles and Keith, opened its seventh outlet in HCMC. The recent opening of NTUC FairPrice’s Co.opXtra in Ho Chi Minh City, the first hypermarket collaboration between Singaporean and Vietnamese companies will also further familiarise Vietnamese consumers with Singaporean brands.
* However, Vietnam always faces with the big trade deficit with Singapore, particularly in recent two years. What is your assessment of this? In your opinion, what should both countries do to deal with this issue?
Over the past few years, total bilateral trade has seen a steady increase. In 2012, bilateral trade between Vietnam and Singapore rose 5.6 percent year on year to reach 13 billion USD. Some components of Vietnamese imports from Singapore are used for further processing into higher value added products for exports. On a global scale, Vietnam recorded its first trade surplus in two decades last year, enjoying a surplus of 284 million USD or 6.8 percent of GDP in 2012.
The results are driven primarily by the exports of foreign invested enterprises that are bringing a technological boost into Vietnam. Export revenue will continue to grow if strong foreign investment can continue to generate higher-value add. To maintain this momentum, Vietnam must continue to liberalise more its trade and investment regulations and continue to take positive steps towards making the business environment more friendly and conducive for foreign investments. In that regard, it is worthy to note that Singapore is one of the largest investors in Vietnam.
* Regarding to investment, could you share with us the contributions which Singaporean businesses made to Vietnam’s development?
As of August this year, Singapore was the second largest investor in Vietnam with approximately 28.6 billion USD in cumulative investments by more than 1000 firms spread across different sectors. As Vietnam continues to undertake steps to liberalise and develop its economy, there is a broad range of sectors in which Singapore companies can partner Vietnam’s growth needs, including urban solutions, consumer-related retail and food services, food processing, logistic, telecommunications as well as tourism and hospitality.
The urban population in Vietnam’s key cities is expected to grow exponentially over the next decade and Singapore is especially keen to share our experience in urban planning and water treatment. These are areas that we have strong expertise in given our own physical constraints and development experience. Singapore companies in the construction, energy, utilities and engineering sectors can tailor customised solutions to meet the needs of key industries across Vietnam.
The Vietnam-Singapore Industrial Parks (VSIPs) serve as good examples of our partnership. The first VSIP established in 1996 was based on a pure industrial model, but this has evolved, across subsequent VSIP projects, to become an integrated industrial township model encompassing the elements of “work, live, and play”.
To date, the VSIPs have attracted over 490 companies and employing over 140,000 workers. Ascendas has also completed the first phase of infrastructural development for the Ascendas-Protrade Singapore Tech Park (APSTP), a project to develop a next generation 500-ha industrial park in Binh Duong Province. In addition, Singapore real estate developer Mapletree has partnered with Saigon Co-op Investment Development JSC to develop SC VivoCity, a 64,000 sq.m family-oriented lifestyle destination mall in Ho Chi Minh City while Keppel Land will develop Phase 2 of Saigon Centre in the heart of Ho Chi Minh City’s District 1, with Takashimaya as the anchor retail tenant.
Singapore firms are cognisant that beyond attracting FDI, it is important to play a responsible role in Vietnam’s sustainable development. The overall benefits of our strong economic relationship include not just financial gains for the firms involved but are also economic and social in nature with tangible returns for the peoples of both sides.
* What has the IE Singapore done to create favourable conditions for Singaporean businesses to invest in Vietnam?
International Enterprise (IE) Singapore is the lead agency under the Singapore Ministry of Trade and Industry promoting international trade and the overseas expansion of Singapore-based companies globally. Our Overseas Centres in Ho Chi Minh City and Hanoi focused on increasing and facilitating business partnerships between Singapore and Vietnam by engaging the two governments as well as enterprises from both sides. IE Singapore raises awareness of the opportunities available in Vietnam for Singapore companies through seminars and business missions and help Singapore firms to build up their market knowledge and competencies before they enter the Vietnam market. Our Overseas Centres help to identify potential projects in areas where Singapore firms have expertise. IE Singapore supports both government-to-government, and government-to-business platforms.
We help Singapore companies establish business connections on the government, enterprise and community levels as well as play an active role in the Singapore-Vietnam Connectivity Framework Agreement to help Singapore companies invest and participate in Vietnam’s growth.-VNA
