Vietnam, US plan several cooperative ventures

The recent very successful visit of Vietnam’s Prime Minister Pham Minh Chinh to the United States is expected to boost further investment and trade between the two countries. Business experts foresee a remarkable growth in future in both exports as well as tourism.

Vietnamese Prime Minister Pham Minh Chinh (L) meets with US President Joe Biden (Photo: VNA)

Boost in tourism

At the conference to promote investment, trade, and tourism between Vietnam and the US, the Saigontourist Travel Company signed a Memorandum of Understanding (MOU) on a comprehensive strategy with US and their Vietnam Airlines partners to promote two-way tourism cooperation. Commenting on the US tourist market, a representative of Saigontourist company said that this is one of the major tourist markets. Every year, the company welcomes and serves about 30,000 US tourists for tours into Vietnam by air and sea routes. According to the present schedule, in 2022 and 2023, the Saigontourist company is expecting to receive a total of 23 cruise ships, with an estimated number of 22,550 tourists from the US alone.

According to Mr. Nguyen Huu Y Yen, General Director of the Saigontourist company, his company is currently focused on promoting a program titled "Vision Destination to US from 2022 to 2025". This program will focus on expanding the market for specific products and services. It will promote international cruise tourism, and market Vietnamese destinations to American tourists. Saigontourist has also coordinated with partners in the US to introduce and promote US tourism to the Vietnamese market, making the US one of the favourite destinations for Vietnamese travellers.

At the conference to promote investment, trade, and tourism, many agricultural products of Vietnam were introduced. The People’s Committee of Bac Giang province, Vietnam Airlines, and US partners signed a Memorandum of Cooperation to promote the export of lychee fruit and other agricultural products of Bắc Giang province. Mr. Nguyen Duc Hung, Director of Global Food Import-Export Company, said that the US is one of the potential markets for Vietnamese agricultural products, especially the lychee fruit. American consumers are also quite open to receiving Vietnamese agricultural products. However, to be able to export to this difficult market, agricultural products both fresh and processed must meet the strict standards of US importers.

Mr. Hung said that for lychee alone, one of the biggest difficulties when exporting to the US market is having to move to the South to irradiate the fruit, which takes a very long time. Enterprises expect to have an irradiation factory in the North soon so that lychee can be exported to the US more conveniently. Many enterprises have been recognized by Bac Giang province to jointly find solutions to promote exports to the US. If Vietnamese agricultural products are well received by American consumers, agricultural products from the US to Vietnam are also experiencing good growth. Currently, Vietnam is the eighth largest market for US agricultural products and food. In 2021, several dairy products exported to Vietnam had good growth.

Capital investment

Referring to capital investment from the US to Vietnam, it is impossible not to mention Intel. Despite the difficulties caused by the Covid-19 pandemic, in 2021 the Intel company continued to invest an additional US$475 mn in factories in Vietnam, bringing the total investment in Vietnam to more than US$1.5 bn. This is the largest high-tech investment from the US in the high-tech park in HCMC. Intel has also committed to invest an additional US$2.6 bn in Saigon Hi-Tech Park soon. Intel highly appreciates Vietnam's infrastructure and human resource facilities, saying that Vietnam is a very significant place for technology enterprises to continue to expand their operations.

Along with Intel, many leading US corporations have also announced new investments in the Vietnamese market. Specifically, Apple's main manufacturing partner Foxconn has invested US$270 mn in Bac Giang province. First Solar, one of the three largest energy corporations in the US, has invested over US$1 bn in a project to produce solar panels with thin-film technology in Vietnam. The survey results on business investment in 2021 by the American Chamber of Commerce in Vietnam (AmCham) show that nearly 80% of AmCham members rate very positively medium and long-term prospects in the Vietnamese market. Adam Sitkoff, CEO of AmCham, said that the Vietnamese Government's continuous improvement of the business environment and removing difficulties for investors is a premise for US businesses to continue investing in Vietnam.

According to the Foreign Investment Agency, until 20 February, the US ranked 11th on the list of 140 countries and territories investing in Vietnam. US investors currently have 1,145 valid projects with a total registered capital of more than US$10.3 bn. At the meeting with the American business community, Prime Minister Pham Minh Chinh emphasized that the US has always been one of the largest investment partners of Vietnam, with a total investment of more than US$10 bn, but this is still not commensurate with the potential that can still be achieved.

The Prime Minister hoped that American partners and businesses would continue to visit Vietnam to look for opportunities. During a meeting with leaders of major US technology corporations such as Intel, the Prime Minister expressed his wish that Intel would further expand investment in localities outside Ho Chi Minh City. When meeting Tim Cook, CEO of Apple Group, the Prime Minister suggested that Apple focus on investing in developing business activities in Vietnam.

Trade, tourism, and investment relations between Vietnam and the US are two-way. On one hand, Vietnam is constantly trying to attract quality investment from the US, and on the other hand, it also promotes investment activities of Vietnamese enterprises to this market. A typical example is of the factory investment project of VinFast, which belongs to Vingroup. At the end of March, VinFast and the US state government of North Carolina announced the signing of a Memorandum of Understanding on the construction of the first manufacturing plant of VinFast in North America. The project will have an investment of about US$2 bn in phase 1 and will help in creating thousands of jobs for local workers.