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Jun 04, 2023 / 14:11

New deals inked during Australia PM’s visit to Vietnam

Cooperation agreements and the opening of direct flights make the visit a productive one for developing economic ties.

Four memoranda of understanding (MoU) between Australia and Vietnam were signed today [June 4] in Hanoi during a meeting between Vietnamese Prime Minister Pham Minh Chinh and his Australian counterpart Anthony Albanese. 

 Vietnamese Prime Minister Pham Minh Chinh (R) and Australian PM Anthony Albanese in Hanoi on June 4. Photos: Nhat Bac/VGP

The MoUs include the establishment of a Trade Ministerial Dialogue Mechanism; the implementation of phase 2 of the Vietnam-Australia Innovation Program; the exchange of financial intelligence related to money laundering and terrorist financing; and scholarships for Vietnamese and regional students between the University of Economics Ho Chi Minh City and Western Sydney University.

At the same time, the two prime ministers witnessed the awarding ceremony of certificates to Vietnam Airlines and Vietjet to open more direct flights to Australia.

Australia will spend A$105 million (US$70 million) to help Vietnam in its clean energy transition. The deal will help support Vietnam’s sustainable infrastructure planning, stimulate private investment in clean energy infrastructure, and deliver technical assistance to develop Vietnam’s critical mineral sector, Albanese said at the meeting with Prime Minister Chinh.

The deals are part of a concerted effort to strengthen trade and economic ties.

Anthony Albanese’s visit starting on June 3 aims to strengthen multisectoral relations between the two countries when they celebrate the 50th anniversary of bilateral ties. During the three-day visit, he is also scheduled to meet the General Secretary of the Communist Party of Vietnam, Nguyen Phu Trong, State President Vo Van Thuong, and Chairman of the National Assembly Vuong Dinh Hue.

This is the third time Chinh and Albanese have met as heads of government, with the last at the G7 Summit in Hiroshima, Japan, on May 19-21.

On the first day of the visit, the Australian Prime Minister visited RMIT, the first Australian university in Vietnam and a symbol of Vietnam-Australia relations in education with Monash, Swinburne, UTS, and Western Sydney Uni.

In the Prime Minister's presence, RMIT announced its plans to expand its extraordinary campus in Ho Chi Minh City, through a A$250 million ($165.5 million) commitment.  

 Vietnam and Australia sign a memorandum of understanding on meetings of trade ministers.  

Pillars in relations

Australian Ambassador to Vietnam Andrew Goledzinowski said that bilateral relations cover three key pillars: economy, which includes trade and investment; innovation and intelligence with cooperation in education and the partnership between universities; and defense.

Goledzinowski expected energy transition and climate response would be the fourth pillar when the relations are upgraded to a new height.

Vietnam and Australia maintain 20 bilateral cooperation mechanisms, including annual prime ministerial and ministerial meetings, among others.

Regarding trade, the two-way value reached $15.7 billion in 2022, up 27% on year, making Australia the 7th largest trader of Vietnam and Vietnam the 10th biggest trade partner of Australia.

Through the Australia-Vietnam Enhanced Economic Engagement Strategy (EEES), the two sides are taking measures to boost trade while encouraging investment in each other.

As of end-April, Australia had 596 projects in Vietnam, focusing on manufacturing, processing, hospitality, healthcare, and agro-forestry-fisheries.

Australia is one of Vietnam’s biggest official development assistance (ODA) providers, with an average of $62 million/year between 2013 and 2019 and $52 million in 2020-2022.

In his speech in Hanoi today, the Australian Prime Minister said: “My government is committed to boosting Australia's relationships in Southeast Asia. And we are, at the moment, developing a Southeast Asia economic strategy to 2040, where Vietnam will play a central role.”

 New agreements for direct flights between the two countries.

Broader move

The talks, aimed at strengthening ties with the strategically important nation, will focus on Australia’s “shared interests” in the bilateral trade relationship and the East Sea (South China Sea).

Albanese raised defense and security issues during his talks, highlighting the two countries’ shared vision of an open, stable, secure, prosperous, and resilient Indo-Pacific that respects national sovereignty.

“Vietnam and Australia want to see a continuation of the peace and progress our countries have enjoyed in the past century,” he said, noting that “we are committed to working together bilaterally and consulting with ASEAN countries and through multilateral forums to advance our vision.”

The Australian Prime Minister said, "All of this connection and cooperation come together in our plans to elevate our relationship to a comprehensive strategic partnership, and the prime minister and I discussed today how we can do that as soon as possible.”

“To signal the trust that we each other, as top tier partners and enduring friends.”

At the meeting between Australia’s Governor General David Hurley and Vietnam’s State President Vo Van Thuong in Hanoi in April, the two sides agreed to discuss lifting the bilateral relations.

Commenting on the move, Professor Emeritus Carl Thayer at the University of New South Wales (UNSW) said the bilateral relations are expected to be upgraded from a strategic partnership to a comprehensive one later this year.