Vietnam-Japan Relationship: Sharing, Understanding, Mutual Trust and Close Cooperation

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40 years after the official establishment of diplomatic relations, the strategic partnership between Vietnam and Japan is seeing its finest and most powerful development. Vietnam Business Forum interviewed Vietnamese Ambassador to Japan Mr Doan Xuan Hung. Thanh Yen reports.

On the occasion of the 40th anniversary of diplomatic relations between Vietnam and Japan, can we be proud to take note of the finest development ofbilateral relations ever since the official establishment of diplomatic relations on September 21, 1973?

In October 2011, during his official visit to Japan, Vietnamese Prime Minister Nguyen Tan Dungand Japanese Prime Minister Noda chose 2013 as the “Vietnam-Japan Friendship Year” to celebrate the 40th anniversary of diplomatic relations between the two countries. The two prime ministers also agreed to proceed with programmes celebrating the Vietnam-Japan Friendship Year.

Vietnam-Japan trade relations existed much earlier. Japanese traders frequently visited Hoi An seaport in Central Vietnam and bilateral trade relations developed most vigorously in 16th century. Hoi An City’s recognition as a world heritage is largely due to the bright images of time-honoured trade with Japan. Lord Nguyen Phuc Nguyen even favoured the marriage of his daughter to Japanese trader Sotaro Araki and then the couple returned to his homeland Nagasaki in 1620. Nowadays, every 7 years, the Okunchi Festival in Nagasaki is celebrated jubilantly with a ship bringing Vietnamese princess and her husband back to Japan. It demonstrates the age-old relationship between Vietnam and Japan.

The above-mentioned decision of the two prime ministers is resulted from the continued development of the long lasting relationship for mutual benefit. Japan and Vietnam have overcome numerous difficulties together and gradually consolidated their close relationship. The relationship has developed from “Reliable partnership in the long term” in 2002 to “Lasting partnership” in 2004, “Towards strategic partnership for peace and prosperity in Asia” in 2006 and “Strategic partnership for peace and prosperity in Asia” concluded officially by Vietnamese General Secretary Nong Duc Manh and Japanese Prime Minister Taro Aso during the visit to Japan of the General Secretary in 2009 and being reaffirmed by high-level visits of the two countries in recent years.

Vietnam always regards Japan as the first ranking reliable and important partner in Asia. While Japan also regards Vietnam as a first ranking important partner in Asia. The fine political relations have facilitated the ever-growing cooperation in all fields.

In the economic field, Japan is the biggest investor and ODA donor, and one of the three biggest trade partners of Vietnam. The two-way trade increased from US$8.5 billion in 2005 to US$17 billion in 2008 and nearly US$26 billion in 2012. By the end of July 2013, Japan has 2,072 projects in Vietnam with registered investment capital of over US$33.66 billion. Japanese ODA to Vietnam mounted to US$24 billion, accounting for 30 percent of assistance pledged by all countries to Vietnam. Many Japanese groups and companies are operating very successfully in Vietnam, such as Sumitomo Corporation, Mitsubishi Corp., , Canon, Panasonic, etc.

It is safe to say that the Japan-Vietnam relationship is developing more vigorously and happily than ever before.

In the Joint Statement on implementing the strategic partnership for peace and prosperity in Asia, signed by Vietnam and Japan on October 31, 2011, the two prime ministers expressed the intention to increase trade value between the two countries to at least double by 2020, and promote all-round cooperation in investment, science-technology, human resources development, foreign relations, national security and defence. How do you expect the development to continue in those fields?

It is quite encouraging. Today, the bilateral relations are developing vigorously. We can be sure of doubling the bilateral trade value, with the present growth rate, and perhaps even before the target date. Furthermore, the two sides have participated in TPP negotiation. When TPP is officially concluded and effective, the bilateral trade relations will develop even more vigorously. I believe that the two-way trade value in 2020 can be at least US$50-60 billion. For investment, there is almost a new investment flow from Japan to Vietnam, and Vietnam is also trying its best to facilitate Japanese investors. Meanwhile, other fields such as foreign relations, national security and defence are also developing with mutual trust and understanding and in the spirit of strategic partnership.

Do you foresee any change in Japanese investment orientation toward Vietnam in the years to come?

So far, most Japanese investments in Vietnam are in the manufacturing and processing industries (82 percent of Japanese investments and 24 percent of foreign investments in manufacturing and processing industries). Those investments have promoted Vietnamese industries to attain the goals of industrialization and modernization. In addition, Japanese companies are also invested in printing technology, mobile phones, motorcycles in Northern Vietnam, and in textile, food processing, electronic parts, machinery, retail sales and restaurants in Southern Vietnam. Presently, Japanese investment is also shifting to the service sector to meet the demand in Vietnam. Major groups such as AEON, Takashimaya or Family Mart are already operating in Vietnam.

It is expected that Japanese investment structure will develop significantly in the coming years. First, the Vietnamese industrialization strategy in the framework of Vietnam-Japan cooperation to 2020 and vision of 2030 mapped out by Vietnamese Prime Minister on July 1, 2013 has the orientation to give priorities to seven areas, namely electronics, farming equipment, agriculture-fisheries processing, ship-building, environment and energy saving, auto-industry and parts. Second, in preparation for TPP, Japanese companies and Vietnamese partners will make the best use of comparative edges provided by TPP in the two countries. Third, ASEAN economic community taking shape in 2015 will greatly attract Japanese businesses. Fourth, Japanese investment will spread out to other localities instead of concentrating in Hanoi, Ho Chi Minh City or some other places.

Coming back to the good and comprehensive relations between Vietnam and Japan, what factors have ensured this relationship?

First, the two countries share many similarities, especially in culture and religion. With friendly ties, mutual respect and understanding, reinforced by intimate feelings of the two peoples and leaders, mutual trust has been created to promote bilateral cooperation in all fields with ever higher efficiency. In fact, the two countries have become close partners for new Asia-Pacific development, in the interests of the respective countries as well as overall peace and prosperity in Asia.

Throughout 2013, large-scale activities have been organised in Vietnam and Japan, bringing the two countries closer to each other and creating a new momentum for the development of the bilateral relationship in the years to come. We will try our utmost to maintain and intensify such momentum.

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