US, Russia compete for investment opportunities in Vietnam
The US economic presence in Vietnam has been increasing steadily since the normalization of Vietnam-US relations since the 1990s. Russia, which was once the largest trade partner of Vietnam, has also returned.
Russia Beyond The HeadLines, in an article published some days ago, quoted economists as saying that there are plenty of niches that Russia can find in the Vietnamese market, even though the US’s increased presence seems to make it more difficult for Russia and other countries to compete.
Hoang Khu, a former technical specialist at Vietsovpetro, an oil and gas joint venture between Vietnam and Russia, said on the website that Russia remains Vietnam’s favorite partner in the fields of high technology, national defence and nuclear power.
Moscow and Hanoi both wish to boost cooperation between the two countries in economic fields. The export of Russian Renault cars to Vietnam and the establishment of a Vietnam industrial complex in Moscow are expected to help promote the economic relationship, which was once very important to Vietnam.
Russia Beyond The HeadLines last June also published an article about the Russians' return to Vietnam. It commented that the return would be a warning to the Pentagon that while the US is becoming a more important partner in South East Asia, Russia is still very important to Vietnam.
Commenting about the competition between Russia and the US in Vietnam, Nguyen Van Ngai, dean of Economics Faculty of the HCM City University of Agriculture and Forestry, said this is a positive sign showing Vietnam’s great potential for them to exploit.
“Both Russia and the US can see great advantages in Vietnam which have not been fully exploited,” Ngai said.
“What they can see is the cheap labor force and plentiful material sources,” he commented.
“Vietnam needs to strictly follow the principle of trade liberalization and equal treatment of investors,” he said.
Vu Vinh Phu, chair of the Hanoi Supermarket Association, and former deputy director of the Hanoi Trade Department, noted that the US and Russia invest in Vietnam "step by step, in a cautious way and with political & economic calculations"
In Vietnam, the US mostly makes investment in high technologies, including information technology. In trade, its farm produce such as beef, wheat and drinks will head for the Vietnamese 90-million consumer market. McDonald’s is present in Vietnam, while WalMart is very likely to come to Vietnam soon.
Meanwhile, though Vietnam-Russia trade remains modest ($4 billion in turnover in 2015), Russia has been investing in Vietnam for a long time, especially in energy (oil & gas and nuclear power).