ASEAN KEY DESTINATIONS
RI, Vietnam agree to increase bilateral trade to $10b by 2018
Indonesian and Vietnamese leaders recently agreed in Beijing to raise bilateral trade to US$10 billion by 2018, the Vietnamese embassy in Jakarta announced on Monday.
“Indonesia’s new President, Joko “Jokowi” Widodo, and Vietnamese [President] Truong Tan Sang met in Beijing on the sidelines of the Asia-Pacific Economic Cooperation (APEC) Summit on Nov. 10. They discussed measures to boost the Vietnam-Indonesia Strategic Partnership and agreed to raise bilateral trade to $10 billion by 2018,” the embassy said in a statement sent to The Jakarta Post on Monday.
According to the Indonesian Foreign Ministry, two-way trade between Vietnam and Indonesia reached $5.12 billion in 2013. The $10 billion trade target should be achievable given the close strategic ties and robust bilateral trade growth over the last five years.
Based on the data from the Central Statistics Agency (BPS), bilateral trade more than doubled to $5.12 billion in 2013, from $2.01 billion in 2009. Over the last five years, it has grown annually at a rate of 25 percent.
In the first eight months of this year, two-way trade has already reached $3.71 billion, an increase of 15.67 percent from the same period in 2013.
The Vietnamese embassy said that President Truong congratulated Jokowi on his success in the recent elections. Hanoi sent a special representative to Jokowi’s inauguration on Oct. 20. Truong invited Jokowi to visit Vietnam.
While accepting the invitation, Jokowi said that his administration would attach special importance to developing the friendship between the two countries. In the Southeast Asian region, Indonesia has only developed a strategic partnership only with Vietnam.
The Indonesian foreign ministry said that leaders discussed several bilateral, regional and global issues, including issues related to ASEAN and the South China Sea.
“Both leaders have agreed to boost joint efforts to enhance bilateral cooperation in various sectors, including maritime and agriculture,” the ministry said in a statement posted on its website.
The two nations will celebrate the 60th anniversary of the establishment of diplomatic relations next year.
In recent years, Vietnam has emerged as a booming market for big multinational companies and foreign investors, especially in the manufacturing sector. Lower production and labor costs, geo-strategic location, investor-friendly government, incentives, fast-developing infrastructure, a 90-million strong domestic market, political and macroeconomic stability, abundant natural resources and many other aspects have transformed Vietnam into a haven for manufacturing.
Last year, Vietnam – the world's 12th largest producer of electronics, exported $38.4 billion worth of electronic and electrical equipment, an amount exceeding Indonesia’s total exports of oil and gas products. South Korea’s Samsung Electronics, which has $11 billion in investment commitments in Vietnam, now ships 25 percent of all its smartphones worldwide from Vietnam. The largest microchip plant in the world, owned by Intel, is located in Vietnam. Microsoft, Nokia, LG and many other companies have established plants in Vietnam.
Indonesia, which has $300 million invested in a cement plant in Vietnam, has an opportunity to invest more in the fast-growing Vietnam to reap the benefits.
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