Netherlands-Vietnam Chamber of Commerce (NVCC)

Meeting on the occasion of the signing of the EU-Vietnam (EVFTA)

H.E. Mme Ngo Thi Hoa, Ambassador Extraordinary and Plenipotentiary to the Netherlands and the Board of the Netherlands-Vietnam Chamber of Commerce have the pleasure of inviting you to a meeting on the occasion of the recent signing of the EU-Vietnam Trade and Investment Agreements (EVFTA) on

Thursday, 18 July 2019

16:00 – 18:30 hrs

Venue: Embassy of the Socialist Republic of Vietnam to the Netherlands

Javastraat 1, 2585 AA Den Haag

Participation: By invitation only (members of NVCC are given priority)

Programme:

16:00 – 16:30 registration

16:30 – 16:35 Welcome by Joost Vrancken Peeters

16:35 – 16:45 Briefing by H.E. Mme Ngo Thi Hoa, Ambassador Extraordinary and Plenipotentiary to the Netherlands

16:45 – 17:15 Remarks by invited speakers (tbc)

17:15 – 18:30 Reception

The meeting will be moderated by NVCC Chairman Mr. Joost Vrancken Peeters.

The number of seats at the meeting is limited, priority will be given to members of the Netherlands Vietnam Chamber of Commerce.

Please register here before Monday 15 July 2019

Note: This meeting is intended for members of the Netherlands Vietnam Chamber of Commerce and special guests.

EU set to sign trade and investment agreements with Vietnam on 30 June

The Council of Ministers today (25th June 2019) approved the EU-Vietnam trade and investment agreements, paving the way for their signature and conclusion. EU Commissioner for Trade Cecilia Malmström and Romanian Minister for Business, Trade and Entrepreneurship Ștefan-Radu Oprea will sign the agreement on the EU’s behalf in Hanoi on Sunday 30 June. The agreements are set to bring unprecedented benefits for European and Vietnamese companies, consumers and workers, while promoting respect for labour rights, environmental protection and the fight against climate change under the Paris Agreement.

President of the European Commission Jean-Claude Juncker said: 
“I welcome the decision taken today by EU Member States. After Singapore, the agreements with Vietnam are the second to have been concluded between the EU and a Southeast Asian country, and represent stepping stones to a greater engagement between Europe and the region. It is also a political statement by two partners and friends standing together for open, fair and rules-based trade.”

Commissioner for Trade Cecilia Malmström said: 
“I am very pleased to see that Member States have given a green light to our trade and investment agreements with Vietnam. Vietnam is a vibrant and promising market of more than 95 million consumers and both sides have much to gain from stronger trade relations. Beyond the clear economic benefits, this deal also aims to strengthen respect for human rights as well as protecting the environment and workers’ rights. I welcome Vietnam’s engagement in the process so far – their recent ratification of the International Labour Organisation Convention on collective bargaining is an excellent example of how trade agreements can encourage higher standards.”

The trade agreement will eliminate nearly all customs duties on goods traded between the two sides in a progressive way that fully respects Vietnam’s development needs. The agreement also contains specific provisions to remove technical obstacles, such as those in the car sector, and will ensure that 169 traditional European food and drink products recognised as Geographical Indications are protected in Vietnam. Thanks to the agreement, EU companies will also be able to participate in bids for procurement tenders in Vietnam on an equal footing with domestic companies.   Besides offering significant economic opportunities, the EU and Vietnam have agreed strong sustainable development measures. This includes a commitment to implement the Paris climate agreement effectively. The agreement also commits both sides to respect and effectively implement the principles of the International Labour Organisation (ILO) concerning fundamental workers’ rights. To this end, Vietnam has recently ratified the ILO Convention on collective bargaining and has notified the EU of its intention to ratify the two outstanding fundamental ILO conventions by 2023 at the latest. It is also in the process of reinforcing its labour legislation. The agreement also establishes dedicated platforms for the EU and Vietnam to involve civil society in the implementation of these commitments. In addition, the trade agreement includes an institutional and legal link to the EU-Vietnam Partnership and Cooperation Agreement, allowing appropriate action in the case of human rights’ breaches.  
The investment protection agreement includes modern rules on investment protection enforceable through the new Investment Court System and ensures that the right of the governments on both sides to regulate in the interest of their citizens is preserved. It will replace the bilateral investment agreements that 21 EU Members States currently have in place with Vietnam putting in place new legal guarantees preventing conflict of interest and increasing transparency.  

What is the next step ?
Following the endorsement by the Council, the agreements will be signed by the EU and Vietnam and presented to the European Parliament for consent. Once the European Parliament has given its consent, the trade agreement can be officially concluded by the Council and enter into force, while the investment protection agreement will first need to be ratified byMember States according to their respective internal procedures.  

Background
Vietnam is the EU’s second largest trading partner in the ASEAN region after Singapore, with trade worth €49.3 billion for goods and over €3 billion for services. While EU investment stock in Vietnam remains modest standing just at €6 billion in 2017, an increasing number of European companies are establishing there to set up a hub to serve the Mekong region. Main EU imports from Vietnam include telecommunications equipment, footwear and textiles, furniture and agricultural products. The EU mainly exports to Vietnam goods such as machinery and transport equipment, chemicals and food and beverages.   
The agreements reached with Vietnam, alongside those signed recently with Singapore, help paving the way for a future region-to-region agreement with the entire Association of Southeast Asian Nations (ASEAN).    

FDI into Vietnam hits four-year high

Saigon Times, 1 June 2019 – Foreign direct investment (FDI) approvals in Vietnam last month reached US$2. 15 billion, bring in the total FDI pledges in the first five months to US$16.75 billion, surging 69.1% year-on-year and the highest Jan.-May FDI over the past four year

According to the Foreign Investment Agency under the Ministry o Planning and Investment, 1,363 FDI projects with total registered capital of US$6.46 billion were licensed in the period, up 38.7% year-on-year. In addition, 505 operational projects were allowed to increase capital by a combined US$2.63 billion, up 5.5%. Meanwhile, foreign capita! inflow from 3,160 mergers and acquisitions deals amounted to US$7.65 billion, 2.8 times higher than the figure a year ago.

FDI capital disbursement in the five-month period was reported a US$7.3 billion, up 7.8% from a year earlier.

New FDI capital was mainly poured into the processing and manufacturing sector, at over US$10.5 billion the real estate sector at US$1.1 billion, and wholesale and retail US$74 million.

Among the 88 countries and territories making fresh investment in Vietnam, China, including Hong Kong, took first place, with US$7.1 billion. South Korea carne second with US$2.62 billion, and Singapore third with US$2.09 billion.

Hanoi attracted the largest FDI capital, at some US$4.8 billion, followed by HCMC, at US$2.7 billion, and the Southern province of Binh Duong US$1.25 billion.

Joost Vrancken Peeters: Vietnam is the One in China plus One.

Nowadays I receive many questions from companies about the so-called “China plus One” strategy. In this article I will explain the concept of the China plus One strategy, the reasons why more companies are looking into it and the reasons why Vietnam is such a popular destination. In a next article I tell more about how to implement such a strategy.

Over the past three decades China has become a major production center and also a very important consumer market. Today the Chinese economy is still growing and offers many opportunities for companies to expand and grow. However,  more companies nowadays are looking more closely to their China operations. The obvious reasons for US companies of course being the growing tension between the US and China and the resulting trade war and tariff increases. But I US companies are not the only ones approaching me, , more and more European companies too want to discuss the China plus One strategy.

The China plus One strategy can best be described as the strategy whereby companies with an existing investment in China are also setting up a company or production facility in a ‘nearby’ location. The most popular nearby locations are Vietnam, Cambodia, Thailand and Indonesia. But why do international companies want to spread their investment across multiple countries, next to China. As stated above China still offers a lot of advantages as manufacturing base and of course as soon to be biggest consumer market it the world.

When asked about their motives, most companies mention a concern about the rising costs in China, predominantly labor costs. Many investments in China were driven by getting access to low labor costs and there is no doubt that China is no longer the lowest cost source. The minimum wages in most countries around it are lower. However, lower costs are not the only reason. Many companies also mention the risk of being active in a transitional economy.  China faces political, economic and social changes, which may bring pressures. Another motive is the changing business climate in China. Although China still welcomes foreign investment, it has also become more selective. And last but not least, some companies do not wish to be depended on one market and one production location. They want to take advantage of the growing middle class in most countries that are a member of the Association of Southeast Asian Countries (ASEAN).

What explains the popularity of Vietnam in the China plus One strategy? Most companies mention five reasons.

The first being the Vietnamese labour force. Not only because the wages are lower. Due to China’s ageing population, it is not so easy to find enough workers. Vietnam offers a young and dynamic workforce, even if this workforce  still needs to be developed into a skilled one. Another reason is that Vietnam is close to China. This means lower costs of transport and since production is nearby, manufacturers can limit delay times. A third reason is  that Vietnam is close to regional shipping lines, is rapidly improving its infrastructure and has more than 100 ports, many of them capable of handling deep sea ships. Vietnam also offers a relatively stable government and the government has worked hard to improve the business laws. Last but not least Vietnam is very active in free trade agreements.

As a member of ASEAN, Vietnam has access to several agreements ASEAN has signed. In August 2018, the EU and Vietnam agreed on the final texts for the EU-Vietnam trade and investment agreements (EVFTA). This EVFTA is expected to be ratified soon. The EVFTA contains full dismantling of nearly all tariffs except for a few tariff lines that are subject to duty-free tariff rate quotas. Moreover, the EVFTA also offers a modern and reformed investment dispute resolution mechanism which guarantees the respect of the substantive investment protection rules applicable to European and Vietnamese investors.

So, based on the above, it is not surprising that many companies set up a second facility in Vietnam. How to set up such a facility and the factors to consider will be the topic of my second article on Vietnam the one in China plus one.

This article was written by Joost Vrancken Peeters, chairman of the NVCC and partner Asia Practice at law firm Kneppelhout & Korthals.

NVCC Visit to Royal IHC Great Success

More than twenty members and guests of the Netherlands Vietnam Chamber of Commerce joined an interesting and sunny visit to the Royal IHC shipyards in Krimpen aan den IJssel and Kinderdijk on Friday 24th May 2019.

Chairman Joost Vrancken Peeters was delighted to welcome, as special guests of the Chamber, H.E. Ambassador Ngo Thi Hoa and Mr. Nguyen Hai Tinh, Commercial Counsellor of the Embassy of Vietnam.

At the Royal IHC shipyard in Krimpen aan den IJssel, the NVCC delegation was warmly received by Mr. Dingeman van Woerden, Area Sales Manager of Royal IHC.

After donning special safety vests, shoes and spectacles, the delegation made a tour around the yard, where, in a huge hall, the reel lay vessel SEVEN VEGA was nearing completion for the launch, one day later.

Click here to read more about the launch.

Click here to see a video of the launch

After the visit in Krimpen aan den IJssel, the delegation moved by watertaxi to the Royal IHC location in Kinderdijk. After lunch, Ambassador Ngo Thi Hoa updated the NVCC members and guests about the developments in Vietnam.

Mr Dingeman van Woerden gave a fascinating presentation about the history of Royal IHC and its current projects.

During the afternoon, the delegation was split up in two groups who toured the Kinderdijk wharf where, at present, the largest cutter suction dredger in the world, the Spartacus, is moored for final fittings.

Click here to see a video of the launch of the Spartacus.

In the training centre, Mme Ngo thi Hoa and others had the opportunity to try out the dredging simulator and ‘virtually’ deepened the River Maas in the Centre of Rotterdam.

to have a look at the photo album of the visit, click here.

Note about photo album: The NVCC cannot publish, due to legal restrictions, photos showing the Seven Vega and the Spartacus.

NVCC Chairman Meets Party Secretary Ho Chi Minh City

Center left Mr Vrancken Peeters; Center right Mr Nguyen Thien Nhan

The Hague, 19 May 2019.

The Chairman of the Netherlands Vietnam Chamber of Commerce, Mr Joost Vrancken Peeters, had a meeting on 19 May with the Party Secretary of Ho Chi Minh City, Mr Nguyen Thien Nhan. The Ambassador of the Socialist Republic of Vietnam, H.E. Madame Hoa, Economic Counsellor Mr Tinh and NVCC Board Member Hanh Do were also present at the meeting.

Key topic of the meeting: the importance of co-operation between Vietnamese and Dutch companies. Mr Nhan endorsed the importance of the role the NVCC plays in this co-operation.

Q1: FDI sector in Vietnam exports over US$ 41 bln

VGP

In Q1, FDI enterprises made an estimated export turnover of US$ 58.51 billion, representing a year-on-year rise of 4.7 pc, the Ministry of Industry and Trade (MoIT) reported.

Including crude oil, the FDI sector earned US$41.46 billion of export turnover, occupying 70.9pc of total export volume.

Overseas shipment of the processing and manufacturing industry grew 6.1pc in Q1, contributing 83.8pc of total export turnover.

Nine commodities earned over US$ 1 billion of export turnover of which seven gained over US$ 2 billion of export turnover.

The MoIT reported that in Q1, FDI enterprises engaged in 18 sectors especially the processing and manufacturing industry which absorbed US$ 8.4 billion, accounting for 77.7pc of total registered capital.

On the other hand, in Q1, the FDI sector imported US$ 33.89 billion of goods, up 6pc against the same period last year.

Hence, in the first three months, the sector ran a trade surplus of US$ 7.57 billion.

 

 

World Bank forecasts Vietnam’s economy to grow by 6.6 pct in 2019

VNA

The World Bank predicts Vietnam’s economic growth rate would reach 6.6 percent in 2019 in its Managing Headwinds report released on April 24.

For the medium term, the growth is projected to stay around 6.5 percent, due to the impact of current cyclical uptick dissipates, the report said, adding that poverty may decline further as labour market conditions remain favourable.The growth rate will be driven by credit tightening, slower private consumption and weaker external demand.

In its report, the World Bank advised Vietnam to stay ready to respond to changes in the global economy and to continue managing its macro-economy actively and carefully.

It forecasts growth in other developing countries in East Asia and the Pacific to soften to 6.0 percent in 2019 and 2020, down from 6.3 percent in 2018.

 

Friday 24 May, NVCC Visit to Royal IHC Shipyards in Krimpen a/d IJssel and Kinderdijk

The board of the NVCC and Royal IHC cordially invite you and/or colleagues, for an exciting visit on Friday 24th May to the shipyards and offices of Royal IHC in Krimpen aan den IJssel and Kinderdijk.

Few manufacturers of and service providers for vessels and equipment for specialist maritime service providers in the dredging, mining and offshore industries have the worldwide reputation and success of Royal IHC. This multinational company, with 3000 staff members and 39 locations around the world, has its head office in Kinderdijk, the Netherlands.

Royal IHC is offering a fantastic programme!

 

Programme:

09.45 – 10.00                    Arrival at Royal IHC location Krimpen aan den IJssel – general parking place.

Coffee served in the Maas/IJssel meeting room with excellent view of ship under construction. Safety instructions!

10:15 hrs                            Start tour – Krimpen Shipyard

11.45 hrs                            Transfer by water taxi to Royal IHC location Kinderdijk

12.15 hrs                            Arrival in Kinderdijk, walk to yard.

12:30 hrs                           Word of welcome and thanks by NVCC Chairman Joost Vrancken Peeters (tbc)

Presentation by Dingeman van Woerden, Area Sales Manager, Royal IHC

Lunch Buffet

13.15 hrs                            Tour of the Shipyard and facility

Group Photo (tbc)

14:30 hrs                            Walk to the watertaxi

14:45 hrs                            Transfer by water taxi back to Krimpen aan den IJssel

15:15 hrs                            End of Programme

 

 

Important information:

 

  • Participation is free of charge to members and special guests of the NVCC.

 

  • Registrations are handled on a first-come-first-served basis. The maximum number of participants is 30. Please register before Friday 17 May.

 

  • Participants are urged to arrive on time (the traffic in the Rotterdam area can be congested).

 

  • Taking photographs is only allowed in designated areas. Please comply with all instructions given by royal IHC staff.

 

A route description and additional information will be sent to you after you have registered.