11:32 | 04/04/2016 Investment
(VEN) - Chief Representative of GIC/AHK Vietnam Marko Walde talked to Vietnam Economic News’ My Phung about the positive signals for promoting trade and investment between the two countries.
German-Vietnamese Business Forum on November 26, 2015 in Frankfurt, on the occasion of Vietnamese President Truong Tan Sang’s state visit to Germany
What do you think of trade and investment relations between Vietnam and Germany over the past four decades since the two countries established bilateral diplomatic relations?
Germany is now Vietnam’s largest trade partner in Europe as it contributes 28 percent of Vietnam-EU trade value. Statistics show that the bilateral trade value reached US$8.9 billion in 2015, of which Germany took US$3.2 billion, and Vietnam got US$5.7 billion. Germany also offers an important gateway for Vietnamese goods to enter other EU markets. Electronics, garments and textiles are the biggest exports to Germany, followed by footwear, coffee, handicrafts, seafood, computers and components. Meanwhile, Germany is the largest supplier of advanced machines, equipment and technology. There are now more than 300 German companies being active in business in Vietnam and they have registered total investment capital of about US$1.4 billion.
Vietnam-Germany relations have developed actively, profoundly and comprehensively. And from now on, we should be prepared for the next steps to develop our relations effectively as well as to force Vietnamese companies in improving their competitiveness. It is also one of our aims to found the bilateral German-Vietnamese Chamber of Commerce, it will provide a great chance for businesses of both sides to promote and increase business opportunities, especially when the Vietnam-EU Free Trade Agreement is signed. With the bilateral Chamber of Commerce, Vietnamese companies as our Full Members will have chances to work closely with German investors and to increase higher international standard on purpose of making progress and more revenues, just like the benefits of all other local companies in ASEAN states and in other 80 countries worldwide.
Which industries in Vietnam will attract more German investment in the years to come?
German companies see Vietnam’s great potential as a destination for manufacturing and investment. As of December 15, 2014, German-registered FDI into Vietnam totaled US$1.4 billion and spanned 244 projects. Some 88 deals worth US$631 million were focused on manufacturing and assembly processing, making this the key investment area. Vietnam is benefiting the most from rising wages in China, with more manufacturers shifting production across the border. In 2014, over 70 percent of FDI into Vietnam was in manufacturing and assembly processing. This included inheriting a lot of low value-added textile and material manufacturing from China. Other potential sectors include BPO (business process outsourcing), food processing, packaging, machinery and equipment.
Do you think Vietnamese President’s visit to Germany in November 2015 will help to enhance trade and investment between the two countries in the near future?
Absolutely. It would be a highly symbolic message to embrace bilateral economic cooperation between Germany and Vietnam. The president confirmed that the Vietnamese government would consistently improve the investment climate to enable foreign investors, including those from Germany, to do long-term business in Vietnam.
During the visit, Vietnam and Germany signed six cooperative documents, including an MoU on regular dialogues between the Vietnamese Ministry of Industry and Trade, the Vietnam Chamber of Commerce and Industry, the German Business Association, and GIC/AHK Vietnam in order to found the bilateral German-Vietnamese Chamber of Commerce. From our point of view, it is not only the good start, but also a very strong commitment.