More Chinese investment boosts China-Vietnam trade ties

HANOI -- China's investment in Vietnam has dramatically increased in both capital value and project numbers in 2013 thanks to the stability in the Vietnam-China bilateral relations, according to a respected expert here.

In an interview with Xinhua, Do Tien Sam, editor in chief of the China Research Journal published by the Institute for Chinese Studies in Vietnam Academy of Social Science, said that the political determination of the two countries' leaders to maintain stable and healthy bilateral relations has helped increase the confidence of Chinese private investors to boost their investment in Vietnam in 2013.

Quoting statistics from Vietnam's Ministry of Planning and Investment, Sam said that China's foreign direct investment (FDI) in Vietnam increased sharply in 2013, with 89 newly-licensed projects and putting more capital into existing 11 projects, bringing the total investment in 2013 to over $2.3 billion, a remarkable increase from $371 million in 2012.

Sam said that in 1991, China invested in only one project in Vietnam but at the end of 2013, China has 977 viable projects in Vietnam, accounting for almost 7 percent of total foreign investment in Vietnam.

"This is a remarkable achievement," said Sam, noting the huge increase in Chinese investment in Vietnam in 2013 was attributed to the signing of a project for the construction of a thermal power plant between China Southern Power Grid Co, Ltd (CSG), China Power International Holding Limited (CPIH) and the Electricity of Vietnam (EVN) in southern Vietnamese province of Binh Thuan.

Sam said he is optimistic that more Chinese investment would flow into the country despite challenges of global financial crisis, and slow economic recovery in the US, the European Union and Japan.

"I am confident that China's investment in Vietnam will remain high and stable in 2014," Sam said.

"The positive sign in bilateral economic relations resulted from right direction of carrying out reforms amid challenges in both Vietnam and China," said Sam, adding that while Vietnam focuses on restructuring public investments, state-owned enterprises and credit institution system, China stresses the importance of in-depth and comprehensive reforms.

Sam said that brighter opportunities are seen ahead for both countries particularly now that Vietnam is about to conclude its negotiations on the Trans-Pacific Partnership (TPP).

Vietnam expects more investment from Chinese companies in Vietnam to build support industries that would maximize benefits for the country when it joins the TPP, the expert said.

Sam said that Vietnam is eager to take advantage of advanced technologies and management expertise that Chinese companies bring to the country.

In an interview with Xinhua late last year, Vietnamese economic and financial expert Bui Kien Thanh said that Vietnam has still much to learn from China's state-of-the-art technologies along with its highly qualified human resources "which Vietnam really needs in its economic development process."

In the joint statement released after the visit of Chinese Premier Li Keqiang to Vietnam in October 2013, the Vietnamese side agreed to support Chinese enterprises to invest in Vietnam and to facilitate the construction of Chinese-invested Long Giang industrial zone in southern Tien Giang province and the 800- hectare Shenzhen-Hai Phong economic and trade cooperation zone in northeastern Hai Phong port city. These two big projects are expected to further boost Vietnam-China trade relations.