UAE investors were yesterday urged to channel more money into Vietnam's economy and tap a market of 85 million consumers.
The call came from the Southeast Asian country's Prime Minister Nguyen Tan Dung during his visit to the Emirates.
He said Vietnam was negotiating a free trade agreement with the UAE, which was regarded as an important Middle East business partner. "Many large projects are being implemented and our two-way trade volume has gone up very fast," he said.
Vietnam achieved gross domestic product (GDP) growth of 6.23 per cent last year despite the global economic slowdown. It attracted $64 billion (Dh235bn) of foreign direct investment capital and maintained macro-economic stability by generating 1.5 million jobs. Dung said there was no threat of nationalisation of foreign assets in Vietnam.
The prime minister was speaking at a networking lunch organised in his honour by the Dubai Chamber of Commerce and Industry.
He offered a red carpet welcome to Emirati businessmen who wished to invest in major projects in Vietnam and promised to create favourable conditions for them.
He said his visit to the UAE would create a breakthrough and open up new prospects for bilateral co-operation and long-term relationships, especially in the fields of trade and investment, energy, labour co-operation and agriculture. This would help both countries to overcome the negative impact of the global economic crisis, face the challenges of globalisation and contribute to stable development and prosperity.
He said Vietnam needed to import crude oil, fuel, chemical and fertilisers from the UAE, which could become a consumption and transit point for Vietnam's export staples such as agricultural products, food, textiles, garments, handicrafts and electronics.
Vietnam is keen to attract UAE investors to participate in high-tech industries, the production of new materials and the agriculture and forestry, infrastructure, education, training, sports and cultural sectors.
Dung said foreign investors could set up industrial zones in Vietnam and benefit from rents and labour costs that were much lower than in Malayasian and Chinese cities. Opportunities existed for developing roads, highways, seaports and airports as well as projects in the hospitality, energy, banking and finance and agriculture sectors.
He told Chamber members that neither language nor his government's property ownership rules would hinder the flow of foreign investment to his country.
"Language is not a barrier in doing business as young Vietnamese speak fluent English and the government plans to give training to labourers before they are sent to work in the UAE."
Dung said foreigners were not allowed to own property in Vietnam but could lease premises for up to 60 years. "This is the first visit by a Vietnamese Prime Minister to the UAE since diplomatic relations between the two countries were established," he added. "Relations were established only in 1993 but the friendship and co-operation between the two countries are long established. Comprehensive reforms introduced since 1986 have brought about great and historical achievements. Vietnam's growth rate has been between seven and eight per cent per year.
"The country enjoys social and political stability and its market economy status has been strengthening. The business and investment environment has been improving in compliance with Vietnam's commitments within the international economic integration process.
"Vietnam has a young and quality workforce. Investors will be able to access a market of 85 million consumers."
Infrastructure to drive bilateral trade
The first step towards improving bilateral trade and investment links between the UAE and Vietnam would be to introduce direct flights between the countries, a senior official said.
"One of the challenges concerning UAE investment in Vietnam is the infrastructure" added Hamad R Al Shamsi, Vice-Chairman of the Chamber. "What we need is an upgrade of the infrastructure. There are no direct flights to Hanoi but with the increase in trade this is a possibility in the near future."
He said the Chamber was committed to extending all possible assistance and facilities to Vietnamese businessmen wishing to set up businesses and joint ventures in Dubai.
"There is no denying that there is a slowdown in certain sectors of the economy, but Dubai is still a lucrative place to invest and the emirate continues to offer its services as the East-meets-West destination.
"In September 2007 His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, led a large UAE business delegation to Vietnam to boost economic ties between the two countries.
He said the Chamber signed a strategic partnership pact with the Vietnamese Chamber of Commerce and Industry to activate and enhance economic co-operation and commercial relations between the two bodies.
Prime Minister Dung's delegation includes a large number of ministerial officials and businessmen from Vietnam.
Al Shamsi said Dubai's non-oil foreign trade with Vietnam reached Dh1.43 billion at the end of 2007 and the country was 55th in the list of Dubai's trading partners. The previous year it was ranked 60th.
A list prepared by the Vietnamese Government of 161 projects requiring overseas investment includes opportunities in the infrastructure, tourism, hospitality, resorts, telecommunications, agriculture, forestry and fishery, oil and gas and other important sectors.
In the oil and gas area Petro Vietnam is seeking investment for the $5bn (Dh18.3bn) Nghi Son Petrochemical Complex in Thanha Hao and a $6bn refinery at Long Son B Rio Vung Tau. These are among the many oil and gas exploration projects open to foreign investors.
Nguyen Chi Dung, Vietnam's Deputy Minister of Planning and Investment, gave a presentation about investment opportunities in Vietnam. The list of major projects requiring foreign investment includes a 40-km long, six-lane highway costing $1bn. The first phase will be a four-lane road needing an initial investment of $745 million. And investors are being sought for a $1.2bn highway.
A number of other highway projects are on offer on a build, operate and transfer basis including a 215-km route that will cost $960m to complete. There are also major railway projects including a $1.6bn inner city network linking the Vietnam capital and national railways.