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Mr. Lee Sang Hak, Economic Counselor of the South Korean Embassy to Vietnam talked with Duc Vuong from the Vietnam Economic Times.
It is 12 years since Vietnam and South Korea established diplomatic relations. What achievements has the cooperation between the two countries reached, especially in the fields of trade and economy?
Vietnam and South Korea have a lot of achievements in bilateral political, cultural and economic cooperation. In 1992, the two-way trade turnover of the two countries was just US$500,000 but in 2003, it hit US$3.2 million.
South Korea has become the fourth biggest foreign investor in Vietnam. In 1992, South Korea invested only US$186 million but now the figure has been up by four times to US$4.4 billion. I want to emphasize that Vietnam and South Korea have just established diplomatic relations for 12 years but the relationship between the two countries has been developing very quickly. That is the assessment of Vietnamese economic experts.
What about the assessment of South Korean economic experts?
In 2001and 2003 South Korean investment in Vietnam ranked respectively the 8th and the 2nd among outward investments of South Korea. Vietnam is the country which receives the most ODA from South Korea.
In 2003, on the occasion of the visit by Vietnamese Prime Minister Phan Van Khai to South Korea, the South Korean Government pledged to donate US$10 million to the construction of the IT University in Da Nang. It can be said that Government of South Korea pays much attention to Vietnam.
What about trade relations? Vietnam suffers great balance-of-trade deficit?
In 2003, South Korean exports to Vietnam valued US$2.624 billion. Most of the exports are cloth, automobile spare parts, machines and equipments for textile and garment production of South Korean enterprises operating in Vietnam. Vietnamese exports to South Korea, mostly aqua and agricultural products, totaled US$492 million.
I think it is the difference in economic structure between the two countries that makes the balance of trade unbalanced.
Could you tell me the situation of South Korean investment in Vietnam?
There are about 700 South Korean enterprises in Vietnam, employing over 200,000 Vietnamese workers. According to a survey of 224 South Korean enterprises in Vietnam carried out from March to August 2004 by the South Korean Embassy to Vietnam and the Department of Trade and Investment Promotion of South Korea in Hanoi, the average capital of each South Korean enterprise in Vietnam is US$3 million, emphasizing on manufacture industry and textile and garment industry.
What do investors think about the investment environment? And how to attract more investment?
92.6% of South Korean investors think Vietnam investment environment is good and 85.1% of them think that the skillful human resource is the best strength of Vietnam.
However, they still have to face some difficulties which are the lack of information about legal adjustments, the lack of materials for production, time-consuming and complicated administrative procedures, bribery, etc.
If those difficulties are solved, more investors will come to Vietnam.
Vietnam Economic Review - (07/12/2004)
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