Vietnam's economic priorities and growth trajectory will open up new opportunities for Singapore businesses, especially in manufacturing, consumer services and urban solutions, said Mr S. Iswaran, Minister for Trade and Industry (Industry).
Mr Iswaran told the Singapore-Vietnam Business Forum at the Ritz-Carlton Hotel yesterday that Vietnam has become "one of the most attractive emerging economies in Asia".
He cited the country's sound economic fundamentals and political stability, noting: "Vietnam's economy has been performing well and is forecast to be on a strong growth trajectory."
Vietnam's emergence as a sound manufacturing base in Asia means businesses can tap the country's competitive advantage in this aspect, and offer supporting services like automation and logistics services to multinational corporations that are establishing operations there, said Mr Iswaran.
The country's maturing consumer services sector also means Singapore's food service and lifestyle brands can offer innovative products and services.
Mr Iswaran added that Vietnam's industrialisation and urbanisation continue to offer Singapore companies opportunities in urban solutions.
"As Vietnam urbanises, Singapore's track record in urban planning and city management will be increasingly relevant to Vietnam's needs for urban solutions," he said. "New opportunities will also arise as Vietnam moves up the value chain, and its industrialisation extends to higher-value-add activities."
Vietnamese President Tran Dai Quang, who also spoke at the event, said the government will continue to push ahead with its efforts to create an "open, conducive and equitable environment for businesses, including investors from Singapore".
Bilateral trade between Singapore and Vietnam has doubled over the past decade to hit $21.6 billion last year, according to IE Singapore. In the same year, Vietnam rose two places to become Singapore's 11th largest trading partner, while Singapore rose two places to rank as Vietnam's sixth largest trading partner. The Republic's investments there totalled US$38.1 billion (S$52 billion) as at April this year, making Singapore Vietnam's third-largest investor and the leading one from Asean.
Yesterday's forum, which was held in conjunction with Mr Quang's first official state visit to Singapore, also involved the Singapore Business Federation and the Vietnam Chamber of Commerce and Industry signing an agreement to further trade and economic relations between the two countries.
Singapore's sovereign wealth fund GIC signed an agreement as well, with the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) - Vietnam's largest bank by market capitalisation.
It will see GIC acquiring a 7.73 per cent stake in the bank on a fully enlarged basis, as part of Vietcombank's private placement of 359.9 million new shares.
The deal, if approved by the relevant authorities, will involve GIC buying 305.8 million new shares in Vietcombank for an undisclosed sum. It will also mark GIC's first significant direct investment in a commercial bank in Vietnam.
The investment in Vietcombank is expected to be completed by the fourth quarter of this year.