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Thailand & Vietnam: Shared prosperity

Released at: 10:08, 14/07/2016

Thailand & Vietnam: Shared prosperity

Photo: TBA

New President of the Vietnam - Thailand Business Council, Mr. Sanan Angubolkul, shares his thoughts with VET on the occasion of the 40th anniversary of diplomatic relations between the two countries.

by Minh Tuyet

■ How would you comment on the potential of economic cooperation between Vietnam and Thailand?

Bilateral trade between Vietnam and Thailand was around $13 billion last year and by 2020 is expected to be $20 billion.

The Thai Government and its enterprises have set strategies to achieve our targets. Total investment from Thailand to Vietnam is some $8 billion, ranking it 11th among foreign investors in Vietnam. This is a significant milestone in the economic cooperation between the two countries.

With the establishment of the ASEAN Economic Community (AEC), both the Thai Government and its enterprise community are determined to be in the Top 10 largest foreign investors in Vietnam. While enterprises are making great efforts, the Thai Government also provides invaluable support for us to achieve this target.

Two weeks ago, the CLMVT (Cambodia, Laos, Myanmar, Vietnam and Thailand) Forum 2016 was held in Bangkok. We had anticipated about 400 representatives from these countries would be in attendance but there was actually 700. At the forum we not only held discussions on regional issues but also strengthened the relationship between the countries and their enterprises.

On the Thai Government’s side, there is consensus among Thai ministers to pursue the Thai Prime Minister’s slogan of “Stronger Development Together”. In the jewelry sector, for example, Vietnam has many natural gem resources but perhaps lacks skills in jewelry design. Meanwhile, Thailand possesses many advantages in having prestigious companies in the jewelry industry. There are possibilities for cooperation and development in this regard.

■ What about other issues?

Besides economic issues, at the forum we also discussed developing cultural exchanges between the two countries. Education is a key sector, especially given Vietnam’s young population. We will therefore introduce more programs to exchange Vietnamese and Thai students.

Thailand attracts a huge number of foreign tourists. This year the number is estimated to be in the order of 32 million. By connecting our tourism and establishing more airline routes, we can work towards more tourists to Thailand also visiting Vietnam.

Among Thai enterprises, SCG, for instance, is eager to expand its business activities in Vietnam. They have development projects in progress and receive support from the Thai Government. They are not only paying attention to conducting business in Vietnam but also seek to bring benefits to Vietnam by providing scholarships and internships for Vietnamese students.

Within the next two years (2017-2018), Thai enterprises will recruit about 2,000 Vietnamese employees and provide about 4,000 scholarships to Vietnamese students over the next four years.

We also wish to say that Thai people love Vietnamese people and we sense a reciprocal feeling from you. Vietnamese people are industrious and quick learners. Thailand is developing a little bit faster than Vietnam, so it commits to helping Vietnam in training and technology transfer.

We believe that all targets can be achieved. We not only pay attention to cooperation between the two countries but also to cooperation between our peoples.

■ What is your assessment of Vietnam’s investment environment?

I view Vietnam’s investment environment at the moment as being like Thailand’s 20 years ago, when it began to open up its market. At that time Japanese were the first foreign investors in the country then many other foreigners came to invest. They created jobs and improved the quality of Thai workers.

Thailand learned a great deal from these investors, improving skills and manufacturing standards. We can now produce goods ourselves instead of depending on imports. Thailand has now become a manufacturing and exporting country and is accelerating the services and retail sectors.

We have changed from an industrial country into a service country. The industrialization process started 30 years ago while retail started 15 years ago.

At this point in time, Vietnam needs support from foreign enterprises to improve its manufacturing ability and productivity. Compared to other countries, labor costs in Vietnam are much lower and Vietnamese workers are industrious, learn quickly, and possess skills.

Vietnam’s investment environment holds many major advantages thanks to the country signing trade agreements with large markets such as the EU and also the TPP.

As Thailand is near Vietnam we can quickly capitalize on changes to boost our investment and support technology transfer. Vietnamese enterprises will have the chance to learn management skills and update manufacturing technology to produce good products at a low cost.

In textiles, for example, Vietnam has become a major textiles manufacturing center of the world. It lacks raw materials and manufacturing technology, however, but Thailand is strong where Vietnam’s has weaknesses. The two countries could therefore cooperate to create the most competitive products.

We currently prioritize infrastructure, transport, services and logistics.

■ Could Vietnamese goods penetrate further into Thailand?

Tastes among regional consumers are quite similar and they prefer good products with cheap prices.

Hotels in Thailand have ordered many Vietnamese products worth around 40 million Thai Baht ($1.13 million). Thailand also buys many gems from Vietnam. Vietnamese coffee and food are easily found in Thailand, while agricultural products could also be exported.

From August 11 to 14 we will hold an exhibition to introduce Vietnamese goods, with about 40 booths in the Central shopping center.

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