UK Minister for Asia, Hugo Swire, spoke about the benefits and challenges between the two countries.
What have been the benefits and challenges of the UK’s economic cooperation with Vietnam over the last three years?
Firstly, we want more bilateral trade. This means more Vietnamese companies trading with the UK and British companies doing the same here in Vietnam.
We also want more British companies to invest in Vietnam, as well as more individual Vietnamese companies to invest in the UK. In doing this we can cement bilateral relations and cement the trade of both sides.
An area in which I think we have a lot do is in working to have more businesses invest here in Vietnam and more Vietnamese individuals investing in the UK. We are proud of being open countries for individual investment from all over the world. I see a lot of Vietnamese investors in the UK and we would like to see some large Vietnamese company names in the UK.
Secondly, the level of investment where there are opportunities for us is constantly changing. For example, opportunities lie in mass transit systems, water, energy, and alternative technology. In particular, huge job opportunities are available in education. The British Council has been here for a long time. They do a great job with English language teaching and examinations and also teach teachers.
And the challenges are the usual things, such as the lack of openness and transparency. Sometimes, British companies are simply abandoned by bureaucracy, so whenever they do business it can present difficulties in some circumstances.
I also said to the Minister of Foreign Affair today in the Strategic Dialogue that certainty is what any investor seeks. The reason why the UK is so successful in attracting individual investment is because it is very open to this investment, with a free press that quickly reports any wrong doing. Moreover, the UK has a reliable framework, active shareholder groups, and an independent judiciary.
How will the Newton Fund support Vietnam after the Strategic Dialogue today?
The Newton Fund has about 5 million British pounds in Vietnam. We want to see more educational ties between Vietnam and the UK. The UK has for many years provided funding to Vietnam, with overseas development assistance. However, in 2010 we stopped it. Not because we didn’t love Vietnam, but because Vietnam had achieved the millennium development goals and taken a huge amount of people out of poverty. Vietnam became a middle income country.
Therefore, relations moved from giving aid to looking at other ways of cooperation, such as education links, the Newton Fund, and trade having less aid.
On the other hand, the EU still continues its significant funding to Vietnam. About 16 per cent of EU funds to Vietnam are from the UK, so via EU programs the UK still gives money to Vietnam. Vietnam becoming a middle income country is a huge success story for the British, who used to pay to help Vietnam via the UK fund. Their money has helped countries like Vietnam alleviate poverty and that is exactly what we intended to do.
What are the preferential sectors for Vietnam-UK cooperation this year?
We have had the Strategic Dialogue. There are a wide range of issues such as human rights, bilateral trade, education, and global issues. When I go back to the UK we will have economic and trade meetings. We will discuss making Vietnam’s investment climate more attractive. We will give priority to discussing the EU free trade agreement because Vietnam has the TPP as well.
What do you predict for economic cooperation between Vietnam and the UK in the next five years?
I would like to be talking about the big Vietnamese investment in the UK and the British companies operating here in Vietnam. The middle class in Vietnam is changing its appetite now. Things are very good, in term of luxury goods, fashion and cutting edge music. British culture is also in demand, which is something that hasn’t happened before in Vietnam.
I think we can create the right framework for British companies to come here in large numbers. Moreover, regarding bilateral trade, Vietnam is doing better than the UK because in 2014 the UK’s exports to Vietnam were 314 million British pounds, whereas Vietnam’s exports to the UK were 2.4 billion British pounds. Therefore, I want to see trade become more balanced.