Vietnamese Foreign Minister highlights potential for Vietnam-SL economic cooperation

Vietnamese Foreign Minister, Bui Thanh Son, had a bilateral meeting lasting nearly 60-minutes with Ambassador for Sri Lanka in Ha Noi, Prof A. Saj U. Mendis, at the ministry head office. The primary objectives of the meeting with the Foreign Minister were to discuss and explore possibilities and avenues to enhance and aggrandize economic, commercial, investment, touristic and trade dimensions and other concomitants of foreign policy issues, particularly, in the context of multilateral cooperation and Sri Lanka’s entry into the largest trading bloc, known as the Regional Comprehensive Economic Partnership (RCEP), among others matters.

A press release issued by Sri Lankan embassy in Vietnam said: ‘Ambassador Mendis expressed appreciation to the Government of Viet Nam and to Minister Bui Thanh Son for the assistance and cooperation extended to Sri Lanka including its support at the Human Rights Council in Geneva. Minister further stated that the bilateral relations in the context of political relations have reached basically the maximal plateau between the two countries and it is of the intrinsic interest of both the countries to translate and transform the political utility to economic utility.

‘Ambassador Mendis stated that, today, Vietnam is among the fastest growing economies in the world and attracts and woos the largest percentage of FDI in comparison to the GDP. This is stated in the context that Vietnam attracted USD 22 billion in 2022 and this year, Vietnam anticipates FDI in the vicinity of USD 28-30 billion. In other words, this figure is over 6% of the GDP of Vietnam, which is the highest percentage of FDI vis-à-vis the GDP of any country. Ambassador Mendis stated that many international economists and analysts have coined terms such as “Miracle on Mekong region”, “Mecca for FDI and manufacturing” and “China plus One” referring to the rise and profile of Vietnam.

‘The Foreign Minister explained that Vietnam had to overcome three issues in order to advance its current status; firstly, infrastructure, secondly, developing soft infrastructure, such as human capital and digital transformation, and thirdly, formulation of foreign policy with reforms in the country that support integration with other countries. Vietnam wishes to exploit and leverage the potential of Sri Lanka in a myriad of sectors and realms. Since the trade between the two countries is at a modest level of around USD 350 million, both countries should have a lucid and focused objective to advance it to USD 500 million within the next year, and then reach USD 1 billion, in the foreseeable future.

‘The minister accentuated the vitality of tourism, since Vietnam is highly focused and is one of the most sought-after touristic destinations in the world, attracting over 10 million tourists in a given year. In this scenario, minister suggested that Sri Lanka and Vietnam could have bilateral tourism since very few Vietnamese travel to Sri Lanka despite the amazing and “riveting” natural beauty and fauna and flora, among others. In the context of air connectivity, the minister stated that direct flights maybe difficult to operate but they could operate charter flights since both the countries have a large Buddhist population. He also added that in 2022, approximately 10 million Vietnamese traveled out of the country, mostly to ASEAN, China, Japan and Europe and very few have traveled to Sri Lanka. Ambassador added that if Sri Lanka could capture 0.2%, it would translate to 20,000, which the minister too agreed needed to be aimed at.

‘The ambassador discussed that the augmentation of Vietnam within a space of two decades was primarily due to its 17 FTAs and Comprehensive/Strategic Partnership Agreements. In this context, Ambassador Mendis too echoed and resonated the sentiments expressed by Sri Lankan Foreign Minister in Jakarta of the deep interest that Sri Lanka has in joining the 15-member RCEP. The minister stated that Vietnam would fully and unreservedly support the application of Sri Lanka to join the RCEP. Amb. Mendis also enunciated the interest of Sri Lanka to have an FTA with Vietnam as both the countries could benefit with regard to bilateral trade.

‘Ambassador Mendis did underscore that both Sri Lanka and Vietnam had exports amounting to around USD 750 million in early 1980s, whereas, today the exports of Vietnam are in the vicinity of USD 370 billion and Sri Lanka is still hovering around USD 12-13 billion. The minister was visibly and discernably keen in enhancing and augmenting bilateral trade as well as bilateral investments between the two countries. Both the minister and ambassador, along with the respective delegations, agreed to exert the efforts and labour in a concerted, determined and proactive manner, thus elevating and deepening, mostly, economic and commercial activity between the two countries.’