The first ever Sri Lanka Vietnam official trade mechanism went live in Hanoi on 21 August. And the new mechanism, according to the Vietnamese side, is the practical way for bigger trade cooperation in the form of an Agreement. “Today’s new beginning will open many new opportunities for both countries. I am   fully convinced that setting up of a Joint Working Group (JWG) or Joint Trade Sub Committee, would lay a concrete foundation to enhance the existing bilateral trade and economic relations  new heights. My Ministry would closely monitor the progress” said a keen Rishad Bathiudeen (Minister of Industry and Commerce of Sri Lanka) at the Head Quarters of Ministry of Industry and Trade of Vietnam, Hanoi on 21 August.

Minister Bathiudeen, who made an in-depth and lengthy submission, was addressing the opening session of the bilateral discussions to establish the first Joint Trade Sub Committee (JTSC) between the two countries, held at the Head Quarters of Ministry of Industry and Trade of Vietnam, Hoan Kiem District, Hanoi on 21 August.

A six member team led by Minister Bathiudeen is currently in Hanoi for the talks to setup this first official trade mechanism. Along with Minister Bathiudeen in the delegation are RDS Kumararatne (DG-Department of Commerce), and Bandula Egodage (Chairman & CEO-EDB). Also joining the Sri Lankan team is (HE) Ivan Amarasinghe (Sri Lanka’s Ambassador to Vietnam). The seven member Vietnamese official delegation is led by the powerful Minister of Trade and Industry of the Vietnam (HE) Vu Huy Hoang and joined by his top commanders-Nuuyen Phuc Nam (Head of Western Asia Markets), and Qui Hui Son (DG-Vietnam Trade Promotion) as well as Deputy Directors. RDS Kumararatne (DG-Department of Commerce) is leading the technical sessions of the first JTSC in Hanoi.

“Vietnam economy too, similar to Sri Lanka has faced difficulties due to global recession. Despite this Vietnam too managed to record strong GDP growth-in 2013 at 5.32% and in the first seven months of 2014 at 5.5%. Our inflation which was at 6.2% in 2013 fell to a very low 1.45% in the first seven months of 2014! Our total international trade which stood at $ 266 Bn in 2013, expected to rise to $300 Bn. We have managed to bring our poverty household rate to 9% by 2013. Both Sri Lanka and Vietnam have lots of unrealised potential in joint economic cooperation and investments-in that the current trade volumes are modest and not in par with the strong bilateral cooperation that exists between both countries-and there is vast potential for new heights and lets work together. I request Sri Lanka Ministry of Industry and Commerce under Minister Bathiudeen to establish the Joint Sub Committee on Sri Lanka side and work with us. We take note of Sri Lanka’s proposal and engage relevant agencies in Vietnam to for this effort-both sides will continue their exchanges in this regard. The most practical way after establishing the JTSC is to study the possibility of establishing the Preferential Trade Agreement between both countries.”

At the 3rd Meeting of the Joint Commission held in Hanoi in July 2012, an ambitious target was set at for the total value of bilateral trade to reach   US$ 01 Billion in the long term, commensurate with the decision taken by the two leaders during the visit of H.E. the President Mahinda Rajapaksa’s to Vietnam in October 2011 to Colombo. At present Vietnam ranks as the 40th export destination and the 23rd    supplier, accounting for 0.43% of our total exports and 1.06% of our total imports respectively.  The total trade between both countries which   stood at US dollars 119.5 Million in 2012 increased to US dollars 224.4 Million in 2013 registering a remarkable growth of 88%. Since 2011, Petrovietnam Oil Corporation (PVOil) has supplied to its Sri Lankan partner with petroleum products. In the field of industry, the two countries have concluded a number of important documents, creating a legal framework for further enhanced cooperation activities. Those documents include: the MOU on Machinery Manufacturing Cooperation between the Ministry of Industry and Trade of Viet Nam and the Ministry of Industry and Commerce of Sri Lanka; the MOU on Oil and Gas Cooperation between the Ministry of Industry and Trade of Viet Nam and Ministry of Industry and Prime Minister’s Secretary Office of Sri Lanka.

As for Vietnam, it continues to integrate more deeply into the regional and global economy. Viet Nam is an active member of ASEAN, APEC, ASEM, WTO. In the framework of ASEAN, Viet Nam is party to ASEAN – China FTA, ASEAN – India FTA, ASEAN – Korea FTA, ASEAN – Australia – New Zealand FTA. Viet Nam is now negotiating FTAs with the EU; the Russia, Belarus and Kazakhstan Customs Union; EFTA; South Korea and the Trans Pacific Partnership Agreement (TPP). As regards foreign trade, Viet Nam’s export value reached USD 132.2 billion in 2013 (increased 15.4% as compared to 2012) and USD 83.5 billion in the first seven months of 2014 (increased more than 14% as compared to the same period of 2013). Viet Nam is among the world’s largest exporters of coffee, pepper, cashew nuts, rice, natural rubber. Viet Nam’s import value reached USD 131.3 billion (increased 15.4% as compared to 2012) and USD 82.2 billion in the first seven months of 2014 (increased 11.4% as compared to the same period of 2013). The state visit by H.E. President Mahinda Rajapaksa to Viet Nam in October 2009, the state visit by H.E. Truong Tan Sang, President of Viet Nam, to Sri Lanka in October 2011 and others have deepened the friendship between two countries, consolidated the mutual trust and understanding between the two countries.