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China, Vietnam find
love
HANOI - After
centuries of enmity, China and Vietnam are
discovering each other as business partners. On
Tuesday itself, Chinese and Vietnamese businessmen
signed 14 deals totaling US$1.071 billion at a
Beijing business forum during President Tran Duc
Luong's current visit to China.
Addressing
the forum, Vietnamese Permanent Deputy Prime
Minister Nguyen Tan Dung, affirmed that his
government has been doing its utmost to help
Chinese investors and businessmen to seek
opportunities for trade and investment in Vietnam.
The Vietnamese leader told a gathering of Chinese
entrepreneurs that with a population of more than
82 million people, Vietnam is emerging as a large,
dynamic and open market on the way to integrate
into regional and international markets.
He said Chinese products, including
consumer commodities and industrial machinery and
equipment, are winning greater prestige in Vietnam
and almost all Chinese investors have achieved
success in the Vietnamese market. Nguyen welcomed
all Chinese businesses and pledged that in
addition to the preferential treatments given to
all foreign investors and businessmen, the
Vietnamese government would work to provide
Chinese investors and businessmen with every
favorable condition it can in order to ensure
their smooth operation in Vietnam.
"We
want the Chinese Council for the Promotion of
International Trade, the Vietnam Chamber of
Commerce and Industry, together with Chinese and
Vietnamese border localities to increase their
cooperation to accelerate trade promotion and
investment, and to organize trade fairs and
exhibitions to help each other seek more trade and
investment opportunities," Nguyen said.
The head of the Chinese Council for the
Promotion of International Trade, Wan Guifei, said
the forum provided a good opportunity for Chinese
businesses eager to contribute to expanding
economic and trade ties between the two countries.
He said that China is the world's largest
developing country, while Vietnam is one of the
fastest growing countries in the region. He also
noted that the formation of a China-ASEAN free
trade zone would offer a good opportunity for the
two to boost economic and trade cooperation.
Vietnam-China trade, which reached a
record US$7.2 billion last year, is likely to
reach $10 billion by 2007, three years ahead of
the schedule set by Vietnamese Prime Minister Phan
Van Khai and Chinese Premier Wen Jiabao at a
meeting in Beijing last year. Trade, which has
grown at an amazing annual rate of 40% in recent
years, has emerged as a bright spot in bilateral
relations, thanks to many advantages, including
the shared 1,643-km land border, and mutual access
to the Gulf of Tonkin.
Since the
resumption of Vietnam-China economic relations in
1991, the two countries have seen stable and rapid
growth in trade, from $32 million in 1991 to
nearly $2.5 billion in 2000 and $7.2 billion in
2004. Vietnam exports in great volumes crude oil,
coal, coffee, sea products, fruits and vegetables,
and footwear to China, while China has registered
large increases in the export of pharmaceutical
products, machinery and equipment, petroleum,
fertilizers, motorbike parts and cars to Vietnam.
Cross-border trade, which has been posing
problems for the authorities for years due to the
long border, is now gradually being put in order.
In addition, official trading channels have been
increasing, adding more kinds of goods that
previously were only traded in small volumes. A
more open payment mechanism at the branches of the
two countries' banks in the border area has
encouraged businesses to pay through banking
services, thus reducing risks and disputes in
cross-border trade.
Bilateral trade
relations are also expanding in scale, with more
Chinese businesses from inland and coastal
provinces reaching out to Vietnam, and Vietnamese
businesses looking beyond the border to China's
coastal provinces and economic zones. The two
sides' businesses also shifted from trade to
forming joint ventures to manufacture and sell
products in the two countries and also export to
third countries. The boost in economic and trade
ties is attributed to hundreds of talks and
meetings between the two countries' enterprises
concerning policies, market information and trade
opportunities, as well as a great number of
product exhibitions held in the two countries,
especially in common border provinces. The
Vietnam-China Business Forum, established last
year, was an especially noteworthy economic
cooperation initiative.
At present, China
is the second biggest trading partner of Vietnam
after the European Union (EU). It is the fourth
largest buyer of Vietnam's goods and the biggest
seller to Vietnam. Yet the value of two-way trade
accounts for just 12% of Vietnam's total trade
turnover, and represents only 0.6% of China's. The
Vietnam Chamber of Commerce and Industry (VCCI)
suggested that to further boost bilateral trade,
both countries' businesses should look to
long-term contracts on supplying products not only
to their countries but also to a third country.
An economic corridor linking China's
southwestern Yunnan province with Vietnam's
northern provinces and cities is expected to
provide further impetus to bilateral business
ties. The corridor, running from Kunming city of
Yunnan province through Vietnam's Lao Cai
province, the Vietnamese capital of Hanoi, and the
port city of Haiphong to Vietnam's Quang Ninh
province, is one of the three economic projects to
be established under an agreement reached by the
Vietnamese Prime Minister and Premier Wen at their
meeting in Beijing last year. Another economic
corridor will connect Nanning of Guangxi province,
Lang Son province, Hanoi, Haiphong and Quang Ninh
province, while an economic belt will encompass
the Tonkin Gulf.
The Kunming corridor will
help implement Vietnam's policies on pushing
socioeconomic development in its northern
mountainous provinces, considered the country's
major target for 2001-10. The corridor will also
assist China in carrying out its strategy to "open
up" the west - an important part of the country's
overall economic development plan. According to Dr
Nguyen Van Lich, Director of the Trade Economy
Institute under the Vietnamese Trade Ministry, the
corridor will become even more important once the
ASEAN-China Free Trade Area is formed.
The
building of the corridor involves developing trade
and economic ties, investment, technical
cooperation, tourism, cross-border economic
exchange, and land, railway and water
transportation. The two countries agreed to focus
first on transport infrastructure, not only to
meet the increasing demands of trade between the
two countries but also to serve the transit needs
of China and ASEAN member countries. Railways and
roads connecting Kunming with Lao Cai, Hanoi and
Hai Phong will be upgraded and a new highway
linking Kunming to Lao Cai, Hanoi, Haiphong and
Quang Ninh will be built, followed by a trans-Asia
railway line.
The two sides are
coordinating to promote cross-border trade and
transit trade. Yunnan's key exports are
electro-mechanical products, telecommunications
equipment and chemicals, while Vietnam mainly
exports agro-forestry-aquatic products and
minerals. Tourism in the corridor also has great
potential, as the area boasts many famous
landscapes. The two sides hope to attract tourists
from Europe, the Chinese mainland and Vietnam,
with tours highlighting the two countries'
original cultural and ecological features.
A glorious example of the fruits of
Sino-Vietnamese cooperation is the Thai Nguyen
Steel Complex in Vietnam, which last year produced
430,000 tons of rolling steel, 300,000 tons of
steel ingot and 210,000 tons of pig-iron, grossing
a turnover of VND2,500 billion (US$157 million).
Its products have gone to almost all key projects
in the country, occupying a firm foothold in the
market. The steel complex, located about 80 km
north of Hanoi, was built with Chinese assistance
in 1959.
At the end of 2001, the first
phase of an extension project of the Thai Nguyen
Steel Complex was completed with a total
investment of nearly $46.7 million, with China
contributing $22 million. The second phase of the
extension (2005-2007), with a total investment of
$200 million, aims to raise the complex's capacity
to 750,000-1,000,000 million tons a year.
The Ha Bac Nitrogenous Fertilizer Factory,
another gift from China to the Vietnamese people
in the 1960s, has markedly contributed to
Vietnam's development. Producing nearly 2 million
tons of fertilizer for Vietnam so far, the factory
over the past four years has had an average annual
growth rate of 18%. The growth rate was achieved
thanks to a $32 million investment from the
Chinese partner to raise the factory's capacity to
150,000 tons a year.
Other major projects
jointly carried out by Vietnam and China include
the Sin Quyen copper project, the Cao Ngan thermal
power project and the Dac Nong bauxite project. In
addition, the Chinese government has decided to
provide 150 million yuan (US$18 million) as
non-refundable aid to help build a Vietnam-China
Friendship Palace. In the 1992-2004 period, China
pledged $312 million of official development
assistance for Vietnam, including $50 million as
non-refundable aid for the upgrade of a number of
Chinese-funded industrial projects in Vietnam.
(Asia Pulse/VNA) |
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