President Joe Biden's visit to Vietnam this time could be a very good stepping stone for Vietnam's economy in the next 10 years.
10 strong development
Over the past 10 years, economic relations between Vietnam and the US have accelerated rapidly since the US and Vietnam established a Comprehensive Partnership in July 2013. Economic relations between the two countries continued to grow strongly in both quality and quantity after President Barack Obama paid an official visit to Vietnam in 2016 and President Donald Trump visited Vietnam twice in November 2017 and February 2019.
Among the nine areas of cooperation, economics and trade have made remarkable progress. This is also an area that has received special attention from US presidents over the years, from Barack Obama, Donald Trump to Joe Biden.
In 2022, US-Vietnam trade reached 139 billion USD, many times higher than the 25 billion USD in 2012. The US has become Vietnam's largest export market.
In the last two years, 2021-2022, Vietnam's exports to the US have reached a record level of over 100 billion USD.
According to Mr. Vicente Nguyen - Chief Investment Officer (CIO) of AFC Vietnam Fund, Vietnam's economy has flourished, accelerated and achieved many successes in the past 10 years after the two sides established a Comprehensive Partnership in 2013.
Looking back at the results over the past 10 years, according to Mr. Vicente Nguyen, exports to the US have increased more than 5 times. Foreign direct investment (FDI) flows from US alliances in the Asia-Pacific region have skyrocketed.
Countries and territories such as South Korea, Japan, and Taiwan (China) in the Asia-Pacific region have sharply increased FDI investment in Vietnam to take advantage of exports to the US.
It can be seen in the case of Korea, in just 10 years, more than 63 billion USD from this country has poured into Vietnam. The largest corporations of Korea have come to Vietnam such as Samsung, LG, Hyundai... All of this has helped Vietnam have a large source of foreign currency, create jobs and many other benefits.
By the end of 2022, US businesses had invested in 1,216 projects in Vietnam, with a total investment capital of 11.4 billion USD.
Of course, according to Mr. Vicente, Vietnamese export enterprises benefit especially greatly.
When real estate froze in 2012-2013, large real estate companies faced numerous difficulties.
At that time, credit for real estate decreased and shifted to the production and business sector, especially export to take advantage of agreements and promote GDP growth, promoting large foreign currency revenues.
"A series of export companies from wood, seafood to garment have taken advantage of the opportunity and strongly increased their exports to the main market, the US. For example, Phu Tai Company (PTB), from a small and medium-sized company, with a profit of less than 70 billion VND in 2012, by 2022, PTB became one of the largest wooden furniture exporting companies in Vietnam with a profit of 500 billion VND in 2022, an increase of more than 7 times. Or in another field, such as Vinh Hoan Seafood (VHC), the profit increased from around 200 billion VND in 2012 to 2,000 billion VND in 2022 with the main market being the US," he cited.
Similarly, Minh Phu Corporation (MPC), the largest shrimp exporter in Vietnam, has had a "miraculous" growth from a profit of only 17 billion in 2012 to more than 800 billion in 2022.
Or a company in the garment industry like TNG also has super-fast growth from 22 billion in 2012 to 300 billion in 2022.
"Thus, the Government's policy of leading capital flows into production and business, combined with the trade agreement with the US, has helped these companies reap amazing results," said Mr. Viciente Nguyen.
A Promising Decade Ahead
According to AFC experts, US President Joe Biden's visit to Vietnam this time could be a great stepping stone for Vietnam's economy in the next 10 years.
And if the US and Vietnam upgrade their relationship, Vietnam expects to gain a lot of benefits. FDI capital will continue to flow strongly into Vietnam.
“If 10 years ago, America’s allies in the Asia-Pacific region invested heavily in Vietnam, now this group will continue to be the main pillar in pouring capital into Vietnam. In addition, we will be able to see new capital flows from a new region, the European Union (EU).
The EU can fully take advantage of this, combined with the free trade agreement between Vietnam and the EU, as well as the urgent need to diversify supply chains, given the experience with Russia.
Therefore, capital flows from the EU may pour into Vietnam. One of the first billion-dollar projects is LEGO, with a construction package worth more than 400 million USD, with construction company Coteccons as the general contractor,” Mr. Viciente commented.
Recently, a series of large American corporations have come to explore investment opportunities in Vietnam. Corporations such as Apple, Intel... are expanding their operations in Vietnam. Meanwhile, Boeing, Google, Walmart Boeing, Google, Walmart, energy corporation AES... are seeking opportunities here.
According to this expert, exports to the US are forecast to continue to increase.
Over the past 10 years, Vietnam's exports to the US have exceeded 100 billion USD, an increase of more than 5 times.
If this upgrade of relations is successful, it is entirely possible to expect that export revenue to the US will grow strongly again in the next 10 years.
From a personal perspective, the AFC expert believes that Vietnam will play an increasingly important role in the operation of the global political economy. Vietnam's prospects in the next 5-10 years are "extremely bright".
Regarding industries, sectors and businesses that can benefit from Vietnam - US cooperation, Mr. Viciente said that sectors with high export proportions will flourish, such as textiles, seafood, agricultural products, etc.
In the textile and garment sector, there are enterprises such as TNG, Viet Tien (VGG), May Song Hong (MSH); seafood such as Minh Phu (MPC), Vinh Hoan (VHC), Nam Viet (ANV), Sao Ta (FMC); agricultural products such as Loc Troi (LTG), Intimex; wood such as Phu Tai (PTB), Duc Thanh Wood (GDT)...
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