Ambassador's Dispatch: Cutting-edge Vietnam

3 March 2017

Mr Craig Chittick, Australian Ambassador to Vietnam

I thought I knew Vietnam, but I was wrong.

When I arrived in Hanoi in July 2016 to start my job as Ambassador, after previous postings in Malaysia and Indonesia, I was confident that I had a feel for a country I had been visiting as a tourist and diplomat since 1998. But the old Vietnam I knew had been replaced by a new, cutting-edge Vietnam: more dynamic, richer, and more aspirational than I remembered. And more polluted and congested, and with more governance challenges too. It's a country that is more prospective than ever, with lots of opportunities and quite a few challenges.

I've been heartened that this wasn't just my experience; our visitors – for business and pleasure – have had similar experiences to me. Almost all have departed as advocates for the opportunities available in modern Vietnam.

We've chosen to showcase this new Vietnam in the first edition of business envoy for 2017 because Vietnam will be a focus of international attention this year as host of the Asia-Pacific Economic Cooperation forum. It will be an opportunity for the world to see modern Vietnam. Vietnam's APEC priorities align almost perfectly with what Australia is doing with Vietnam: there is a focus on 21st century education, making exporting and importing easier, empowering women in the economy, and ensuring our food supply is safe and secure. These are not distant dreams for Vietnam; they are the contemporary experience for Australian businesses, universities and government. I'm pleased to share their stories.

I was initially surprised to find out that the 22 000 Vietnamese are the fourth largest group of foreign students in Australia, with another 7 500 studying in Vietnam for an Australian qualification. Australian education delivers around $1 billion in export revenue for Australia and provides Vietnam with an internationally-competitive group of future leaders. The 50 000 or so Vietnamese alumni of an Australian education – who understand both Vietnamese culture and language and our love of Vegemite – provide a ready bridge for Australian business. The emergence of a group of young Vietnamese and Australian leaders in business, government and society is evident through the entrepreneurial group who have established the Australia-Vietnam Young Leadership Dialogue and whose businesses win top awards in Australia. There are some great examples in the stories that follow.

Those education links have also fostered an innovation partnership that, while still in its infancy, is already delivering benefits for Australian business and research institutions. Our universities are finding world-class collaborators, often amongst our alumni community; whether it is RMIT University's Centre of Digital Excellence in Ho Chi Minh City that leverages that city's reputation as a "coding factory" or the University of Technology, Sydney's new joint research centre with Vietnam National University in Hanoi where they work on the Internet of Things. Businesses like the Viet-Uc Seafood Company are collaborating with CSIRO and numerous other Australian organisations to develop and test new commercial technologies in the aquaculture sector.

Australian culture and produce are recognised as world class in Vietnam. These will be on display at the Australian Government's Taste of Australia celebration in Vietnam in April 2017. Australia's own Luke Nguyen will again be our Face of Taste of Australia, and will be on hand (and at the kitchen bench) to support Australian food, beverage and (for the first time) fashion companies seeking to enter the Vietnamese market.

There are still problems in Vietnam. Australian businesses tell me they often struggle to navigate government red tape, deal with insufficient infrastructure and deflect requests by some for corrupt payments. Reflecting these challenges, Vietnam is currently ranked at 82 out of the 190 countries in the World Bank survey on ease of doing business (more difficult than Thailand and Malaysia, better than Indonesia and The Philippines). Vietnam itself understands these problems and has embarked on an economic reform program to develop a business environment competitive with the top four in ASEAN (Singapore, Malaysia, Thailand and Indonesia).

The Australian Government is investing through the aid program to support Vietnam improve its business environment, including through better competition policy and trade facilitation arrangements, and construction of roads and bridges to address infrastructure challenges. Australia is co-financing the Cao Lanh Bridge which will open later this year. This crucial transport link will spur economic development by connecting Vietnam's Mekong Delta with regional markets.

International competition will be vital to improving Vietnam's business environment, and Vietnam has built a network of international trade agreements to further open its market. Australia's own free trade agreement with Vietnam (through the ASEANAustralia- New Zealand Free Trade Area) provides ongoing improvements in market opportunities, primarily in merchandise exports. Our participation with Vietnam in new trade agreements, including the Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership, could offer new opportunities in services and investment as well.

While these challenges are real, there is also a hardheaded optimism amongst the Australian business community in Vietnam about the future for Vietnam and their own businesses. We are working with the Australian Chamber of Commerce in Vietnam, under the leadership of Chau Ta, to help Australian companies navigate their way through Vietnam. AusCham's new MOU with Vietnam's Department of Foreign Affairs of the Provinces allows it new reach to all of Vietnam's 63 provinces. This work will be brought together at the Meet Australia conference later this year where Australian business will have a chance to meet with Vietnam's provincial leadership on commercial opportunities throughout Vietnam.

So, my best advice, given my own experience and that of almost all of our visitors, is come and see modern Vietnam for yourself.

Last Updated: 3 March 2017
Australian Ambassador to Vietnam, Craig Chittick