Few countries around the world better exemplify the benefits of trade and investment liberalization than Vietnam, the minister wrote in an article published on www.dfat.gov.au last week.
Australian Minister for Trade, Tourism and Investment Steven Ciobo. Photo: acfid.asn.au
Ciobo said Vietnam is now a middle-income country with a population of 90 million, noting that the country has heavily invested in education and skills, reinforcing its favorable demographics, including a median age of 30.
“With the help of partners such as Australia, it is investing in transport infrastructure that will consolidate its favorable geography, notably its proximity to the growth engines of southern China and the world’s busiest maritime trading routes,” he added.
Commenters judge Vietnam as among the best of the emerging economies to escape the so-called “middle income trap” and follow a similar trajectory of the first Asian tigers like Singapore, the Republic of Korea and Taiwan. By mid-century, Vietnam is expected to join the world’s top 20 economies, he said.
Ciobo highlighted trade and investment liberalization as the core of Vietnam’s growth. “Two-way trade is equivalent to 185 percent of Vietnam’s GDP. In a short period of time, clothing manufacturing has grown into a 40-billion-USD export industry, with Vietnam now the second largest supplier of apparel to the United States, Japan and the Republic of Korea. Samsung makes nearly a third of its smart phones in Vietnam. Foreign direct investment in Vietnam rose to record highs in both 2015 and 2016”.
He cited the fact that Vietnam is now Australia’s 15th largest trading partner, with bilateral trade exceeding 10 billion USD and Australian investment in Vietnam growing strongly. Australia sees tremendous potential for its businesses to gain market share in sectors such as agriculture, energy, financial services, education, tourism and health.
Australia is pursuing a strong innovation and education agenda with Vietnam and the Australian-Vietnamese community represents the sixth highest foreign-born population in Australia.
The minister noted as Vietnam prepares to host Asia-Pacific Economic Cooperation (APEC) leaders in central Da Nang city in November, Australia is working closely with Vietnam to drive economic connectivity and reduce trade barriers among APEC’s 21 member economies.
“Vietnam is one of the largest users of ASEAN-Australia-New Zealand Free Trade Area tariff preferences for Australia, and the two countries are involved in negotiations for a Regional Comprehensive Economic Partnership, a trade agreement that would cover over 30 percent of global GDP. While the United States has withdrawn from the Trans Pacific Partnership (TPP), Australia, Vietnam and other TPP members are working to ensure the benefits of the agreement are not lost,” he added.
He stressed that the time has come for Australia to take relations with Vietnam to a new level and encouraged Australian businesses to be part of Vietnam’s remarkable growth.
Minister for Trade, Tourism and Investment Steven Ciobo will accompany Australian Prime Minister Malcolm Turnbull to visit Vietnam during its APEC host year in 2017.