(MPI) - On November 17th, 2020, the 18th session of the Vietnam-Korea Intergovernmental Committee took place under the co-chair of Deputy Minister of Planning and Investment of Vietnam Tran Quoc Phuong and Deputy Minister for Economic Affairs at the Ministry of Foreign Affairs of the Republic of Korea Lee Seong-ho.
Attending the meeting, at the video-conference terminal of the Executive Center of the Ministry of Planning and Investment, there were the Korean Ambassador to Vietnam and representatives of the ministries, government agencies in the economic and social sectors and representatives of the People's Committee of Hanoi City and Bac Ninh Province.
Lee Seong-ho, Deputy Minister for Economic Affairs at the Ministry of Foreign Affairs of the Republic of Korea, speaks at the South Korean video-conference terminal. Photo: MPI
Speaking at the meeting, Deputy Minister Lee Seong-ho congratulated Vietnam on the positive results in Covid-19 epidemic prevention and control and the implementation of socio-economic development goals, sharing the great losses in life and property caused by the historic floods and storms in the central provinces of Vietnam and hoped that Vietnam would soon overcome these damages.
Deputy Minister Lee Seong-ho highly appreciated the Vietnam-Korea cooperation relationship with many great achievements which was currently in a very good period. Vietnam - South Korea cooperation in all fields has had a remarkable development, bringing about mutual benefits, understanding and trust, marked by a Comprehensive Strategic Partnership. Korea is the third largest trading partner of Vietnam, the fourth largest export market and the second largest import market of Vietnam.
Through the Vietnam-Korea Economic Cooperation Committee, the Ministry of Foreign Affairs of the Republic of Korea and the Ministry of Planning and Investment of Vietnam regularly exchanged, cooperated and made great contributions to economic cooperation between the two countries. Therefore, the meeting is a good opportunity for the two sides to continue exchanging useful ideas in order to find a direction to strengthen investment cooperation, especially in the context of the complicated ongoing Covid-19 pandemic.
Deputy Minister Tran Quoc Phuong speaking at the Vietnam terminal. Photo: MPI
Speaking at the meeting, Deputy Minister Tran Quoc Phuong informed about the socio-economic development of Vietnam in the first 10 months of 2020 and said that the Covid-19 pandemic had affected the global economy, including Vietnam. In addition, climate change, natural disasters, droughts, saltwater intrusion, and historic floods in the Central region are causing a lot of damage, affecting people's lives. Nevertheless, Vietnam's economy has achieved many positive highlights and been recognized and highly appreciated by the international community thanks to the drastic action of the whole system, political dominance and striving efforts of the entire Party, the people, the army and the business community.
The macro economy has been maintained stable. Economic growth shows signs of recovery with GDP in the first 9 months of 2020 estimated to stay at 2.12%, helping Vietnam be a rare economy with positive growth in the world. Inflation continues to be controlled. The financial and monetary market is basically stable with bank credit recovering its growth momentum. Although the agricultural sector faces many difficulties and challenges, it still affirms its role as a support for the economy and is expected to grow strongly in the fourth quarter of 2020, especially the rice and coffee production and shrimp exports. Industrial production continues to recover with the growth driver of the manufacturing and processing industry. The service sector is heavily affected, but some industries initially recovered, catching up with the trend of the pandemic period. Import and export goods continue to be the bright spot of the economy. In the first 10 months of 2020, trade surplus is estimated to reach a record of 18.72 billion USD, import turnover has reached a positive growth again, showing that production activities being restored.
Deputy Minister Tran Quoc Phuong said that the Government of Vietnam has accelerated the implementation and disbursement of public investment to promote economic growth, innovation and application of science and technology and information technology to quickly adapt in the epidemic context. Vietnam has maintained high ratings on the innovation index, leading the list of low medium-income countries.
It is forecasted that in the coming time, Vietnam will still face many difficulties and challenges as the Covid-19 pandemic continues its unpredictable developments in other countries, affecting the recovery of the world economy and trade and export activities of Vietnam. In economic sectors, the service sector, especially aviation, accommodation and tourism, is forecasted to decline sharply. FDI has recovered slowly and is likely to continue to decline while the epidemic in Vietnam's major partners is still complicated. Vietnam has a favorable opportunity to welcome the wave of investment to move around the world but is subject to strong competition from some markets such as India and Indonesia. Besides, there are many other difficulties such as strategic competition between big countries. Natural disasters, storms and floods are expected to continue to develop complicatedly, affecting the socio-economic situation and people's lives in the last months of 2020 and the year 2021.
At the meeting, Deputy Director of Foreign Investment Department, Ministry of Planning and Investment, Do Van Su presented the economic cooperation situation of the two countries and said that Korea was always a big partner of Vietnam. As of October 2020, Korea had about 8,900 valid projects with total registered investment capital of about 70.4 billion USD, ranking first in total registered investment capital and total investment projects in Vietnam. Korean projects focus on manufacturing and processing sectors. The localities to be invested in include Bac Ninh, Thai Nguyen, Dong Nai, Binh Duong, Long An, Hai Phong, and Ho Chi Minh City. As of May 10th, 2020, Korean investment in Vietnam is 528 projects with total registered capital of 3.342 billion USD in spite of the pandemic effects. Vietnam currently has 49 projects invested in South Korea with a modest scale, the total investment capital of Vietnamese investors is 35 million USD.
For the orientation of FDI attraction in the coming time, Vietnam moves to attract investment in a selective manner, taking quality, efficiency, technology and environmental protection as the main evaluation criteria. Projects with advanced technology, new technology, high technology, clean technology, modern governance, high added value, spillover effects, connecting the global production and supply chain are prioritized.
At the meeting, relevant ministries and line ministries of Vietnam and Korea focused on reviewing the situation of cooperation between the two countries in sectors since the 17th session, and setting out directions for cooperation in the in the coming time, such as discussing the situation and solutions to promote trade, investment, development cooperation, labor - society, environment, land, energy, infrastructure, consular – justice, science and technology, agriculture, rural development, finance – banking, etc., and the two countries' participation in regional and international cooperation frameworks.
The comments at the meeting showed that Vietnam - Korea cooperation continued to have strong developments in the past year in all fields. In the context of the global economic and trade rebound after being affected by the Covid-19 pandemic, Vietnam and Korea need to continue close cooperation to make entry for Korean personnel, ensuring the goal of restoring production and business activities and epidemic prevention.
In terms of official development assistance, Vietnam continues to be the top priority partner that Korea provides ODA for. Development cooperation between Vietnam and Korea is given priority to the fields of transport infrastructure, urban areas, healthcare, education, training, environment, clean energy, information technology, etc.
Concerning this content, Director General of Department of Foreign Economic Relations, Ministry of Planning and Investment Pham Hoang Mai said that Korean ODA projects had made important contributions to socio-economic development of Vietnam, focusing on the areas of human resources, technology transfer, climate change, and so on. However, in 2020, the implementation of many projects has difficulties in bidding due to the impact of the Covid-19 pandemic and binding terms and conditions of loans related to the origin of goods.
At the meeting, many opinions suggested that in the coming time, Korea would facilitate and quickly settle procedures for importing some agricultural products and food of Vietnam in order to raise two-way trade turnover to 100 billion USD in the direction of balance. At the same time, it is suggested that Korea stop applying anti-dumping tax on plywood products imported from Vietnam. Along with that, it is necessary to continue to strengthen information exchange, improving capacity. These are the strengths that Korea and Vietnam want to be supported.
The Korean representatives recommended Vietnam support and create the most favourable conditions for Korean enterprises to make new investment and expand production and business activities in the context of global economic and trade recovering gradually after being affected by the Covid-19 pandemic. The Korean government encourages large Korean corporations which plan to move investment away from other countries to research investment possibilities in Vietnam, especially projects in Vietnam's priority areas such as high technology, electronics, recycled energy, infrastructure development, building specialized technology complexes, investing in developing infrastructure of industrial parks, high quality agriculture, public health, biology, tourism, etc., and small and medium-sized enterprises to invest in Vietnam.
In his concluding remarks, Deputy Minister Tran Quoc Phuong highly appreciated the candid comments on the cooperative spirit of the representatives. The meeting reached a consensus on many contents. Many proposals and solutions given by the two sides in order to enhance investment cooperation in the coming time. The two sides exchanged frankly to find out solutions to solve difficulties for businesses, and enhancing investment cooperation, especially in terms of bilateral cooperation and business investment cooperation. Areas of cooperation such as industry - energy, infrastructure - transport - construction, agriculture, consular - justice, finance - banking, science - technology, information - communication, culture - sports - tourism, education, natural resources - environment also achieved positive results.
Discussions and comments have important implications in promoting Vietnam - Korea cooperation. These results will be presented in the Minutes of the meeting and reported to competent authorities to further strengthen trade and investment cooperation, bringing benefits to businesses and people of the two countries./.
Ministry of Planning and Investment