Enhancing Hanoi-Singapore business connections

Participants of a Hanoi-Singapore business connection meeting

Second highest Hanoi investor

Since the establishment of diplomatic ties in 1973, Vietnam and Singapore have built a close and successful collaboration in a variety of fields. Singapore was the biggest foreign investor in Vietnam in the first two months of 2023, with investment of US$978.4 million, down 42.7 percent year-on-year, the Ministry of Planning and Investment reported. It is also the second-largest investor in Hanoi and has a substantial economic footprint in the capital city.

In 2022, Hanoi exported goods worth US$615 million to Singapore, representing 3.6 percent of its total export value. Singapore is also a significant import market for Hanoi, which accounts for 8.4 percent of its total import value.

Despite the challenges posed by the COVID-19 pandemic, Singaporean companies have continued to invest in Vietnam, a testament to their confidence in Vietnam's economic climate and Hanoi's future potential.

Kho Choon Keng, President of the Singapore Chinese Chamber of Commerce & Industry (SCCCI), says Vietnam has emerged as the second most favored market for Singaporean enterprises after Malaysia, according to a business survey conducted by SCCCI in 2022. An increasing number of Singaporean companies have been seeking investment opportunities in various sectors in Vietnam, including infrastructure, manufacturing, logistics, transportation, education, tourism, finance, and agriculture. Kho Choon Keng also highlighted the potential for collaboration in new areas such as renewable energy and the digital economy.

General Secretary of Vietnam Chamber of Commerce and Industry (VCCI), Nguyen Quang Vinh emphasizes the significance of boosting corporate collaboration in fields like high technology, digitalization, infrastructure, renewable energy, education and tourism. With a total registered capital of US$71 billion, Singapore is one of the top three largest investors in Vietnam, making up 22.9 percent of Vietnam's total foreign direct investment (FDI). The Vietnam-Singapore Industrial Parks (VSIPs) in nine Vietnamese provinces have become successful examples of bilateral collaboration.

Hanoi encourages trade connections between its enterprises and Singaporean companies

Conditions for expanded investment

Hanoi recognizes the significant role of the business community, particularly FDI businesses, in propelling the city's development and integration. Hanoi People's Committee Vice Chair Nguyen Manh Quyen says the city's aim is to attract sustainable international investment, with emphasis on urban infrastructure development, smart city construction, and modern and eco-friendly supporting industries.

To that end, the city has implemented several mechanisms and policies. These include promoting infrastructure improvements in industrial zones and clusters, simplifying administrative procedures for investors, and increasing the use of information technology for business registration, investment registration, tax, insurance, and land administration. The city also makes sectoral, zoning, and land use plans publicly available to provide investors with easy access to investment information.

Moreover, the city encourages trade connections between Hanoi and Singaporean businesses to facilitate exchange, investment cooperation, trade ties, and the growth of industrial, commercial, and service investment by both sides. As Vietnam and Singapore are both parties to two major regional trade agreements, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership Agreement (RCEP), Hanoi can leverage these agreements to facilitate links between local and Singaporean businesses, boosting exports.