Vietnam PM Visit To Singapore To Boost Bilateral Ties – Analysis
The Prime Minister of Vietnam Pham Minh Chinh will undertake a state visit to Singapore from 8 to 10 February 2023. Vietnam and Singapore share excellent bilateral relations, underpinned by the Strategic Partnership Agreement concluded in September 2013 during Prime Minister Lee Hsien Loong’s official visit to Vietnam. The two countries’ economic ties are robust, with bilateral trade growing steadily over the last decade.
Diplomatic relations between the two countries were established on 1 August 1973. Since then there have been several bilateral visits by top political leaders. During their meeting ahead of the ASEAN-US Special Summit in the US in May 2022, Prime Minister Chinh and his Singapore counterpart Lee Hsien Loong agreed to promote high-level visits and meetings and maintain bilateral cooperative mechanisms. On 12 May 2022, the two leaders reached consensus on continued cooperation in post-pandemic economic recovery and development, including in bolstering digital economy, green economy and circular economy, towards the 50th anniversary of the two countries diplomatic relationship and 10 years of their strategic partnership in 2023. Chinh’s forthcoming visit to Singapore is in continuation of that understanding.
Earlier, the two countries have agreed to expand the chain of Vietnam-Singapore Industrial Parks (VSIP) in Vietnam and to make best use of new-generation free trade agreements to which both are members such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).
For Vietnam, Singapore within the ASEAN bloc is one of the important partners. On its part, Singapore too attaches importance to and wants to develop its strategic partnership with Vietnam in both bilateral and multilateral frameworks. Singapore is impressed that within the bloc, Vietnam is the fastest growing economy and therefore economic cooperation is an important foundation in the two countries’ relations with huge potential.
Vietnam is going to host the 31st Southeast Asian Games (SEA Games 31) on 12 May 2023 after six months delay. Strong cooperation between the two countries and with deepening economic collaboration is seen within the bloc as a bright example of cooperation and connectivity in the region.
Singapore has emerged as the second largest foreign investor in Vietnam with total registered capital exceeding $67.5 billion. The VSIPs have operated effectively over the past 20 years, contributing to their strategic partnership. Cooperation in defence-security, culture, education and people-to-people exchange help maintain robust development of the relationship. Vietnam has suggested bolstering collaboration in education-training and asked Singapore to provide more scholarships for Vietnamese managerial officials. Vietnam’s PM Pham Minh Chinh is expected to express desire to strengthen joint work in addressing security challenges, both conventional and non-conventional, epidemics and climate change. Both Chinh and Loong are expected to exchange views on regional and global issues of mutual concern, including existing cooperative mechanisms and new initiatives on economic cooperation in the region.
When the Speaker of Singapore Parliament Tan Chuan-jin had visited Hanoi on 18-20 May 2022, Chinh had remarked that Vietnam-Singapore strategic partnership shall become more and more extensive and effective, especially when the two countries were looking forward to the 50th anniversary of the establishment of diplomatic relations and 10 years of Strategic Partnership in 2023. Chính had congratulated Tan Chuan-jin about Singapore’s outstanding achievements, including always leading the way in the region in catching new development trends of the world, especially in science and technology with its high international prestige and position.
In the economic domain, despite the impact of the COVID-19 pandemic, the two-way trade turnover between Việtnam and Singapore had still grown positively, reaching $8.3 billion in 2021, an increase of over 23 per cent compared to 2020 and was more than $783 million in January 2022. Singapore was the largest investor of Vietnam in ASEAN with 2,866 valid projects and total registered capital of $67.5 billion. Singapore investors have participated in building infrastructure for 13 industrial parks in Vietnam, with a total area of about 7,517 hectares. Those industrial parks are operating with high occupancy rates (83.2 % on average), attracting nearly 1,000 projects, of which more than 80 per cent are foreign-invested projects with a total registered capital of about $18.1 billion, and nearly 300,000 jobs have been created.
No wonder, the VSIPs received special mention for its important contribution to the regional economic development in Vietnam and also helped spread the working spirit, labour discipline and Singapore’s management thinking in Vietnam, becoming a successful model in economic cooperation between the two countries. Chinh hopes the two sides would continue to support and create conditions for cooperation in recovery and economic development after the pandemic, focusing on areas where Singapore has strengths and Vietnam has needs so that a win-win situation can be achieved.
In fact, Singapore’s Minister for External Affairs Vivian Balakrishnan was candid to say that economic cooperation has been the cornerstone of Vietnam-Singapore bilateral relations. Singapore companies see Vietnam as an attractive investment destination. Singapore does recognise that Vietnam has experienced rapid growth and development since it embarked on its Doi Moi program in 1986, and Vietnam has consistently enjoyed high GDP growth rates. With its young and hard-working population of nearly 100 million, Vietnam is well placed to become a major engine for growth and economic integration in the region. Vietnam was one of the few countries in the world in 2021 to achieve positive economic growth amidst the pandemic. This showcases the resilience of Vietnam’s economy, which was expected to be one of the region’s fastest-growing economies in 2022.
The areas of cooperation include innovation, green energy, digital economy and diversification of the global supply chain, bringing the connection of the two economies towards a new level of “connection on a digital platform” through the effective implementation of the “MoU on Co-operation in the Digital Economy”, Chính expects that Singapore would help to develop VSIP zones in a number of provinces and cities in Vietnam following the model of smart, high-tech, innovative, environmentally friendly and energy-saving; and the two sides would effectively take advantage of the implementation of free trade agreements, especially Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and Regional Comprehensive Economic Partnership (RCEP).
Vietnam is aware that Singapore was the country with the highest vaccination rate in the world in Covid-19 prevention and control measure and quickly moved to the stage of “adaptation, development and long-term coexistence with Covid-19”. When the pandemic struck, Singapore was the first responder in supplying medical equipment and vaccines to Vietnam. Therefore, further cooperation in research and production of vaccine between the two countries was stressed.
In fact, in the fight against Covid-19, the two countries have helped each other. In early 2020, when the pandemic developed complications in Singapore, the Vietnamese National Assembly granted 30,000 face masks to its counterpart. In 2021, when Vietnam was in trouble, Singapore was among the first members of the ASEAN bloc to provide medical equipment and supplies to Vietnam. Singapore donated a lot of medical equipment to the country through the Temasek Foundation and other organizations, with a total value of more than $3.72 million in September 2021. Singapore announced a gift of 122,400 doses of AstraZeneca vaccine for Vietnam.
Cooperation in the fields of defence and security, culture, tourism, and people-to-people exchanges and seeking new development motivations, especially in areas where Singapore has strengths and Vietnam has potential are already identified. Sharing experiences in digital transformation, for example in the fields of tax collection, banking and population management as well as support Vietnam in human resource training, especially high-quality human resources and increasing scholarships for managers at all levels in Vietnam are areas to develop cooperation. There are now about 13,000 Vietnamese people in Singapore engaged in studying and working in Singapore.
On the foreign policy front, both the countries are in discussion on continuous basis on regional and global issues that are of mutual concern. Both stress that ASEAN should stick to its position on the East Sea and resolve disputes by peaceful means on the basis of international law, including the 1982 United Nations Convention on the Law of the Sea (UNCLOS 1982) and the importance of ensuring security, safety, freedom of navigation and over-flight in the East Sea.
There is good opportunity for both Vietnam and Singapore to promote intra-regional solidarity aimed to solve security challenges in the East Sea, Myanmar issue, economy (especially on supply chain and restructuring), sustainable development and digital transformation to further contribute to the peace and stability in the region for the benefit of each country and the ASEAN bloc.
It thus transpires that both Vietnam and Singapore have great potential to expand cooperation further. Promoting cooperation and strategic partnership between India and the ASEAN is another area where both the ASEAN nations can look for mutual benefits. In the larger regional context, trilateral cooperation between India, Vietnam and Singapore can be a new mechanism supplementing the existing ones on issues such as maritime security and providing logistical support to securing th4 maritime domain could possibly explored.
