BDC cements Swedish ties with Vietnam

Sweden’s Ministry of Foreign Affairs recently established a Business and Development Council (BDC) to cement commercial relations between Sweden and seven countries including Vietnam.

Newly appointed Swedish ambassador to Vietnam Staffan Herrström told VIR about the council and commercial relations between the two countries.

What is Sweden’s Business and Development Council initiative and how can it benefit Vietnamese and Sweden enterprises?

The council is in charge of giving advice to the government about how to maximise Swedish enterprises’ experience and expertise in developing countries.

Vietnam is one of seven countries for the initiative to be implemented on a pilot basis, so that Swedish enterprises’ experience can be used to contribute to Vietnam’s sustainable economic growth. Experience from Vietnam and the remaining six countries will be reported to the council based in Stockholm, from which further cooperation models will be made.

Sweden’s government has during the last years acknowledged the need to make better use of the experience and expertise of the business sector in implementing its policy for global development. The Swedish business as an actor must be fully utilised to contribute to global growth and poverty reduction.

Through trade and investment, Swedish businesses can help to generate economic growth in Vietnam by increasing employment, the development of technology and knowledge and higher tax revenues. Swedish businesses can also make a valuable contribution to the dialogue on designing and implementing Swedish development policy – not least as exponents of Swedish values and attitudes regarding, for example, corporate social responsibility (CSR).

Most Swedish companies present in Vietnam are in close collaboration with local partners, mainly small- and medium-sized enterprises (SMEs). This collaboration enables a knowledge transfer between Sweden and Vietnam, which is of great benefit for both sides. The local partners will experience the benefits with CSR – such as a higher revenue, lower turn-over of staff and a cleaner environment.

The fact that our embassy in Hanoi is picked as one of the “pilots” in this initiative shows the importance our government attaches to broaden and deepen the economic and commercial relations with Vietnam.

Why are you particularly interested in boosting trade promotion between Vietnam and Sweden?

The Swedish relationship with Vietnam dates back since the engagement against the American War. Sweden was also the first western nations to establish diplomatic relations with Vietnam in 1969. The Swedish engagement in Vietnam has mainly been focused on development cooperation that has resulted in several success stories, such as the Bai Bang paper mill.

Over the last few years, we have seen a strong growth in Vietnam’s economy which has drawn the attention of Swedish companies to Vietnam. The trade between our countries has nearly doubled since 2005 and 2009, with total trade of around $500 million per year. It has also brought substantial investments to Vietnam from Sweden. Today Vietnam is home to about 80 Swedish companies.

Vietnam is probably the most attractive country in the Southeast Asia to outsource production to – especially in the garment, textile, footwear and furniture sectors. I also believe that the IT sector will be of interest for outsourcing during the coming years. The economic growth is creating a fast growing middle-class that also raises the attractiveness of Vietnam.

I believe that there are great opportunities for Swedish businesses in Vietnam. I also believe that trade and investments can be a driving force for Vietnam’s further sustainable development. Vietnam’s needs in many sectors are suitable to Sweden’s competence and supply, which, for example, are available in “green solutions” of different kinds like in energy, waste management, water treatment and traffic solutions. Information and telecommunication technology including mobile telecom and internet is another area where I think many sectors in society could benefit in terms of productivity and transparency. Here there are interesting opportunities like e-banking, e-health and e-learning.

It is also encouraging to see that Vietnam is constantly improving its business climate, even if of course more needs to be done not least against corruption.

At present, our embassy is setting up the Center for Environmental Technology (CENTEC), which will be operational in early next year and will work to promote sustainable energy solutions and clean technologies as well as activities relating to CSR. Its main purpose is to facilitate partnerships between public and private actors in the two countries.

The Vietnamese market will no doubt continue to grow and my ambition will be to encourage Swedish companies, especially SMEs, to participate in Vietnam’s future development.

What are your priorities in boosting investments between the two countries during your term in Vietnam?

The reasons are basically the same as with trade. I also believe that the great importance that Swedish companies attach to fair working conditions, environment and a firm attitude against corruption make them attractive investors and employers. The Swedish enterprises have a vast knowledge of working with CSR, which is of benefit both to the company itself as well as to the society as a whole. I have already seen this in reality when visiting companies and meeting Swedish businesspeople in Vietnam. The clear and firm attitude against corruption is a case in point.

In 2009, Vietnam and Sweden inked an agreement on development cooperation for 2009-2011. So, how is the agreement being implemented and what are your expectations about this agreement?

he agreement is focused on two areas. Firstly environment and climate change. Secondly human rights and democracy including anti-corruption and media. During these years we are moving from traditional working methods to a partner driven cooperation built on a much more equal relation for mutual benefit. This will definitely also be a way to contribute to and energise our efforts to increase trade and investment.

From the implementation, I have seen great results from the remaining parts of our earlier programme like in the so called Chia Se-programme where I have visited Ha Giang and seen the positive effects when villagers are empowered to take decisions on development priorities, and how they benefit from the transparency about funds and utilisation as well as from the grass-root democracy developed.

I certainly hope these methods will be integrated in processes like the socio-economic development plans. From the new direction with partner driven cooperation I already see a great interest in many areas like environment, health, culture and improved statistics just to name a few. I certainly expect this to stimulate close relations between our societies and private sectors beyond aid. – VIR

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Posted by VBN on Dec 4 2010. Filed under Int'l Cooperation. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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