Business
Why Hanoi and Berlin expect joint chamber of commerce and industry?
Vietnam appears to be the first choice for German firms who eye investment expansion in Asia.
Both Hanoi and Berlin said they hope for the establishment of a joint Chamber of Commerce and Industry to boost the economic ties of the two important strategic partners.
Outgoing German Ambassador to Vietnam Christian Berger said at a meeting with Vietnamese Prime Minister Nguyen Xuan Phuc in Hanoi earlier this week that he hoped for the soon establishment of the chamber to facilitate investment and trade in the coming time, local media reported.
In turn, PM Phuc agreed with the proposal, saying that Germany, the biggest economy in the Europe, plays an important role in the bilateral relations and Vietnam’s partnership with other European countries.
Phuc hoped for Germany’s further support for Vietnam in industrial development and tightened cooperation in economic ties which he mentioned in different meetings with Chancellor Angela Merkel over the last three years, including the latest on the sidelines of G20 Summit in Japan in late June.
During the meeting, the ambassador also suggested the establishment of Joint Committee on Economics for further partnership.
Also earlier this week, in a farewell meeting with Vietnamese Deputy Prime Minister Pham Binh Minh, Christian Berger emphasized the role of trade and investment in the multifaceted relations.
Idea of Joint Chamber of Commerce and Industry
Since July 2015, the Embassy of Germany in Vietnam has been after a plan to set up the Vietnam-Germany Chamber of Commerce and Industry in Ho Chi Minh City to support both Vietnamese and German businesses and boost the economic ties.
The joint chamber aims to support not only German companies but also Vietnamese ones which seek to invest and do business in Germany, the Vietnamese Ministry of Industry and Trade (MOIT) cited the embassy’s plan.
In August 2015, the government of Vietnam asked the MOIT to consider the plan and report the assessment to the prime minister.
Since then, the MOIT has sought support for the establishment from different agencies. Of the agencies and organizations, the Vietnam Association of Foreign Invested Enterprises (VAFIE) strongly backed the plan, saying that Germany, with the leading role in the European Union (EU) and having long-lasting ties with Vietnam, would be positive to the further partnership and relations with the EU.
Advantages
A report by the MOIT has addressed a number of advantages of the joint commerce and industry chamber, according to Vietnambiz.
Diplomacy: Germany set up ties with Vietnam in 1975 and the two countries upgraded the status to strategic partnership in 2011. Berlin has recognized Vietnam's market mechanism, supported the country in South China Sea issues, contributed to the signing of the EU-Vietnam Free Trade Agreement (EVFTA), and facilitated the community of more than 130,000 Vietnamese people who study and reside in the European country.
Berlin invited Vietnam to attend G20 Summit in Germany in 2017.
Over the past years, a number of Germany's top leaders namely Chancellor, Minister of Foreign Affairs, and Minister of Economic Affairs and Energy have expressed their support for the establishment of the chamber with the Vietnamese.
Economics: Germany is currently Vietnam’s largest trade partner in the Europe. The two-way trade reached US$15.6 billion in 2018, accounting for roughly 20% of the trade turnover between Vietnam and the EU, statistics by Vietnam's customs showed.
Germany ranks among the biggest ODA providers for Vietnam.
In terms of investment, German companies are investing more than US$2 billion in 328 projects in Vietnam, Chief Representative of Germany Chamber of Industry and Commerce (AHK) in Vietnam Marko Walde said, adding that the investment remains moderate but it comes with advanced technologies and long-term operations of 20-30 years.
German firms choose up-to-date technologies which help support local production while many others focus on training highly-qualified manpower to master advanced production chains, VietNamNet reported, citing Marko Walde.
Marko Walde said 51%-52% of German companies globally said in a survey that they planned to enlarge their operations in Vietnam, adding that the ratio is very high compared to that in regional countries.
Marko Walde said German firms have pursued the "China plus 1" model, meaning they invested in China and ASEAN countries since they started to operate in China 10-20 years ago and now Vietnam is a suitable destination besides Thailand thanks to Vietnam’s developing infrastructure and supply chains.
Local media reported that more German firms seek investment in Vietnam and many of them consider to shift location from China to Vietnam.
The joint chamber is expected to benefit Vietnamese firms with access to investment information free-of-charge, participation to joint business activities, trade promotion among others.
The establishment of Vietnam-Germany Industry and Commerce Chamber might result in a similar model for other partners of Vietnam, the MOIT forecast.
So far, dozens of German companies have good performance in Vietnam like Siemens, which started operating in Vietnam in 1979, Mercedes (since 1995, leading Vietnam’s luxury car market with more than 50%), B. Braun (since 1992), Deutsche Bank (since 1992), Zott, Thyssenkroup, Styrolution, and Van Laack.
German Ambassador to Vietnam Christian Berger at a meeting with Vietnamese Prime Minister Nguyen Xuan Phuc in Hanoi on July 17. Photo: VNS
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In turn, PM Phuc agreed with the proposal, saying that Germany, the biggest economy in the Europe, plays an important role in the bilateral relations and Vietnam’s partnership with other European countries.
Phuc hoped for Germany’s further support for Vietnam in industrial development and tightened cooperation in economic ties which he mentioned in different meetings with Chancellor Angela Merkel over the last three years, including the latest on the sidelines of G20 Summit in Japan in late June.
During the meeting, the ambassador also suggested the establishment of Joint Committee on Economics for further partnership.
German Ambassador to Vietnam Christian Berger and Vietnamese Deputy Prime Minister Pham Binh Minh in Hanoi on July 16. Photo: VGP
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Idea of Joint Chamber of Commerce and Industry
Since July 2015, the Embassy of Germany in Vietnam has been after a plan to set up the Vietnam-Germany Chamber of Commerce and Industry in Ho Chi Minh City to support both Vietnamese and German businesses and boost the economic ties.
The joint chamber aims to support not only German companies but also Vietnamese ones which seek to invest and do business in Germany, the Vietnamese Ministry of Industry and Trade (MOIT) cited the embassy’s plan.
In August 2015, the government of Vietnam asked the MOIT to consider the plan and report the assessment to the prime minister.
Since then, the MOIT has sought support for the establishment from different agencies. Of the agencies and organizations, the Vietnam Association of Foreign Invested Enterprises (VAFIE) strongly backed the plan, saying that Germany, with the leading role in the European Union (EU) and having long-lasting ties with Vietnam, would be positive to the further partnership and relations with the EU.
Marko Walde, Chief Representative of Germany Chamber of Industry and Commerce (AHK) in Vietnam. Photo: Minh Tuan
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A report by the MOIT has addressed a number of advantages of the joint commerce and industry chamber, according to Vietnambiz.
Diplomacy: Germany set up ties with Vietnam in 1975 and the two countries upgraded the status to strategic partnership in 2011. Berlin has recognized Vietnam's market mechanism, supported the country in South China Sea issues, contributed to the signing of the EU-Vietnam Free Trade Agreement (EVFTA), and facilitated the community of more than 130,000 Vietnamese people who study and reside in the European country.
Berlin invited Vietnam to attend G20 Summit in Germany in 2017.
Over the past years, a number of Germany's top leaders namely Chancellor, Minister of Foreign Affairs, and Minister of Economic Affairs and Energy have expressed their support for the establishment of the chamber with the Vietnamese.
Economics: Germany is currently Vietnam’s largest trade partner in the Europe. The two-way trade reached US$15.6 billion in 2018, accounting for roughly 20% of the trade turnover between Vietnam and the EU, statistics by Vietnam's customs showed.
Germany ranks among the biggest ODA providers for Vietnam.
In terms of investment, German companies are investing more than US$2 billion in 328 projects in Vietnam, Chief Representative of Germany Chamber of Industry and Commerce (AHK) in Vietnam Marko Walde said, adding that the investment remains moderate but it comes with advanced technologies and long-term operations of 20-30 years.
German firms choose up-to-date technologies which help support local production while many others focus on training highly-qualified manpower to master advanced production chains, VietNamNet reported, citing Marko Walde.
Marko Walde said 51%-52% of German companies globally said in a survey that they planned to enlarge their operations in Vietnam, adding that the ratio is very high compared to that in regional countries.
Marko Walde said German firms have pursued the "China plus 1" model, meaning they invested in China and ASEAN countries since they started to operate in China 10-20 years ago and now Vietnam is a suitable destination besides Thailand thanks to Vietnam’s developing infrastructure and supply chains.
Local media reported that more German firms seek investment in Vietnam and many of them consider to shift location from China to Vietnam.
The joint chamber is expected to benefit Vietnamese firms with access to investment information free-of-charge, participation to joint business activities, trade promotion among others.
The establishment of Vietnam-Germany Industry and Commerce Chamber might result in a similar model for other partners of Vietnam, the MOIT forecast.
So far, dozens of German companies have good performance in Vietnam like Siemens, which started operating in Vietnam in 1979, Mercedes (since 1995, leading Vietnam’s luxury car market with more than 50%), B. Braun (since 1992), Deutsche Bank (since 1992), Zott, Thyssenkroup, Styrolution, and Van Laack.
