Feb 27, 2012

Vietnam - EU-Vietnam: Fostering opportunities in times of crisis


VietNamNet Bridge - David O’Sullivan, Director General of the European Commission’s External Relations, will make a working visit to Vietnam from February 28 to March 2. 


He will co-chair a European Union (EU)-Vietnam dialogue at the deputy Foreign Minister level to seek ways to promote bilateral ties. VietNamNet had an interview with Sullivan before his trip to Vietnam.


What do you think about the relationships between Vietnam and the EU?

Vietnam and the EU enjoy an increasingly strong and broad partnership based upon mutual respect and confidence. 

The conclusion, at the end of 2010--of a new Vietnam-EU Partnership and Cooperation Agreement, marked a qualitative step in the way we engage as equal partners. 

We look forward to further enhancing this relationship because it has tremendous opportunities. It is now time to make the best of these opportunities.

The EU is a big donor for Vietnam. Will it continue its great support for Vietnam on the way to eradicate hunger and reduce poverty?    

There is profound admiration in Europe for the way Vietnam has managed to embrace reform and lift millions of its citizens out of poverty. 

The EU is committed to standing on Vietnam’s side when the country is to make some difficult decisions for its long-term development. 

The record US$1 billion ODA pledge made by the EU and its Member States for 2012, confirmed our confidence in Vietnam’s future and its capacity to pull itself out of poverty. 

But the commitment of the EU to keeping its market open is actually the best contribution we can make to creating more growth and employment in Vietnam and in the EU. 

How about the trade ties? 

Vietnam’s exports to the EU increased by 33.5 percent in 2011. This is a good illustration of the saying that with every crisis come opportunities. Both Europe and Vietnam need that trade. 

Integration in international markets has been the driver of our strong economic results in the past, and will continue to play that role in the future. This is why we look forward to progress towards an ambitious and mutually-beneficial Vietnam-EU Free Trade Agreement (FTA). 

The EU welcomes Vietnam’s commitment to take on increasing international responsibilities, be it in the WTO, in the UN and within ASEAN. The EU was a strong supporter of Vietnam’s accession to the WTO. It cooperated extremely well with Vietnam during its very efficient chairmanship of ASEAN in 2010.

Could you talk more about other fields of cooperation?

The time has now come to enhance further our cooperation on issues of global concern, including tackling climate change, promoting security, non-proliferation and nuclear safety, as well as preventing pandemics and natural disasters. 

The EU has an enormous range of policies and instruments beyond trade and aid – in the environment, science and technology, consumer protection, education, public health, energy – which can and should work better for Vietnam’s development.     

Despite some of the important challenges that we are facing, in Europe and in Vietnam, I am therefore very optimistic about the future of our relationship.

But the potential of this relationship will be fulfilled only if we recognize, on both sides, that we need to take hard decisions and show determination in our commitment to reform. 

Vietnam and the EU also share the view that the promotion of human rights and the rule of law is a driving force for development. We encourage the Government of Vietnam to take these issues seriously, because they are of crucial importance for Vietnam’s long-term growth prospects as well as for its international reputation. 

The EU is particularly proud to have been able to support Vietnam’s legal and judicial reform process and welcome the progress achieved in that field. A free media and a free internet would also provide huge benefits in meeting the myriad of challenges that come with a modernising society. 

We look forward to continuing the very mature and constructive dialogue and cooperation that we have established with Vietnam on Human Rights. 

The global crisis has made adverse impacts on the world in general and the EU in particular. What has it done to overcome the crisis?

I am confident that the comprehensive and credible package of measures which EU leaders have taken in the past months to rein in public debt, recapitalise banks and strengthen economic governance will help to reassure the world that we are dealing with the Euro-zone debt crisis and that we’ll remain a robust economic partner for Asia. 

The economic fundamentals of the EU are still strong and healthy, and the political sense of urgency and effectiveness in dealing with the challenges must not be doubted. The Euro will survive the present difficulties and the European economies will come out of the crisis stronger.  

However, on-going concerns about the Eurozone and continued weakness in the US economy demonstrate that no economy is immune from crisis. Even the richest, in the absence of sound macro-economic management and policies to maintain competitiveness in the long-run, can run into crises. 

What is your advice for Vietnam in the time of crisis and to achieve its goal of becoming an industrialized country by 2020?

Vietnam, which has been very successful economically since the launch of the Doi Moi policy, is currently facing its own economic and social challenges. 

Stabilising the economy, promoting investment efficiency, moving up the value chain, restructuring State-Owned Enterprises, reforming the financial sector, creating a skilled labour force, fighting corruption, reducing social disparities and creating jobs for more than 1 million young people entering the labour market each year won’t be easy. 

But important decisions are needed now if Vietnam is to succeed its second transition to becoming an industrialised and modern economy by 2020. Vietnam has proved in the past that it was able to take difficult decisions. We stand ready to support Vietnam in moving forward its reforms. 

Against the backdrop of the persistent macro-economic challenges which Vietnam is currently facing, it is important to keep markets open. Only by expanding exports rather than curbing imports can Vietnam tackle the issue of soaring inflation and stabilise its economy. 

Protectionist measures would distort Vietnam’s positive image and do lots of harm while not being able to restore the trade balance.

Living up to its WTO commitments is the best that Vietnam should do to reassure and encourage further Foreign Direct Investment inflow. Further market opening, especially with economies that are complementary to yours - like the EU - would be an important choice to this end. 

I hope an EU-Vietnam FTA can be a key component to supporting Vietnam’s ambition of modernizing its economy and society and bring it firmly and beyond “middle income” status. 

Vietnam is located in one of the fastest growing regions in the world. Do you think that it is an additional advantage for the country’s development? 

Vietnam is currently at the center of many of the strategic shifts going on in Asia. We Europeans follow these developments with great interest because we have a strong stake in Asia’s prosperity and security. 
The EU has, for years, been a strong supporter of the ASEAN integration process. We want to be an active and constructive player in the evolving Asian regional architecture. 

We look forward to the next EU-ASEAN Foreign Ministers’ Meeting, at the end of April in Brunei, to deepen even further our engagement with the region. 

Vietnam is also in the middle of the fastest growing region in the world. Reforms in Vietnam will therefore be compared to countries of the region which are also going through their own reform process. This makes the challenges, but also the opportunities for Vietnam even greater.  

My visit to Vietnam coincides with the beginning of the Year of the Dragon. The Year of the Dragon is a special year in Vietnam, a year of new ideas, major changes and great opportunities. I very much hope that we’ll use this year to make our long-term partnership even more robust and full of opportunities. 


Xuan Linh



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