Vietnam and Switzerland have lot of room for cooperation

Tuesday, 13/02/2024 16:28
(CPV) - Vietnam-Switzerland relations have developed strongly in politics, economics, technical assistance, trade, investment, research, science, culture, tourism and people-to-people exchanges since the two countries established diplomatic ties in 1971. On the occasion of the Lunar New Year of the Dragon, Swiss Ambassador to Vietnam Thomas Gass spoke to the Communist Party of Vietnam Online Newspaper about cooperation opportunities and prospects between the two countries in the coming time.
Swiss Ambassador to Vietnam Thomas Gass (Photo: Swiss Embassy in Vietnam)

Reporter: After 53 years of diplomatic relations (1971-2024), the relationship between Vietnam and Switzerland is developing successfully on both bilateral and multilateral levels. Could you please highlight some key milestones of our relationship over the past years?

Ambassador Thomas Gass: Relations between Switzerland and Vietnam have traditionally been very warm and continue to strengthen and deepen. Switzerland was one of the first Western countries to formally recognize the Socialist Republic of Vietnam in 1971, and relations have developed dynamically, starting with development cooperation and moving to economic cooperation focused on national priorities such as banking, sustainable value chains and eco-industrial parks. Today the relationship between the countries is also rooted in strong private sector partnerships.

In recent years, senior Swiss officials have repeatedly visited Vietnam and vice versa. In June 2023, the then President of the Swiss National Council Mr Martin Candinas visited Vietnam, and at the end of his official talks with top Vietnamese state officials, he extended an invitation to His Excellency Vuong Dinh Hue to visit Switzerland in 2024.

The annual World Economic Forum provides opportunities for high-level meetings between officials from both countries. The many meetings held between top Vietnamese and Swiss leaders at the Forum speak to the commitments of our respective governments to developing strong bilateral relations. I am very pleased that this year Prime Minister Chinh has met Swiss President Viola Amherd and our Minister for Economic Affairs, Education and Research, Mr Guy Parmelin.

Considering Vietnam’s impressive achievements in human capital development, social inclusion and poverty reduction, Switzerland continues to prioritise cooperation with Vietnam as the country undergoes a complex structural transformation moving from a centrally planned to a market economy. We strive to support this transition through projects aimed at promoting a market-based sustainable growth policy, addressing the side-effect of rapid economic growth, such as environmental degradation, accelerated urbanization and climate change. Switzerland also cooperates with Vietnam to meet some of the challenges of becoming one of the most open economies in the world, for instance raising labour productivity. As in other countries, Vietnam's rapidly ageing population may weaken its ability to produce the skilled workforce needed to build a high value-added, knowledge-based economy. Ambitious structural reforms are important to stimulate private investment, raise productivity, streamline the public sector and strengthen the financial sector. 

Reporter: Switzerland is currently actively advocating for the signing of Free Trade Agreement (FTA) between Vietnam and the European Free Trade Association (EFTA - comprising four countries: Switzerland, Norway, Iceland and Liechtenstein). In your perspective, how might the signing of this agreement lead to breakthrough developments in trade and investment relations between Switzerland and Vietnam?

Ambassador Thomas Gass: The free trade and investment protection agreements currently being negotiated can bring significant benefits to both Vietnam and Switzerland. They are crucial for better reciprocal market access and investment and for a better integration of value chains across both countries. Free trade can also improve the quality of life of people in the signatory countries by allowing them to import goods on more favourable terms that are not readily available domestically. Free trade can likewise increase productivity by giving firms in the signatory countries better and more advantageous access to technology and advanced equipment, enabling them to improve the quality and sophistication of the products they manufacture and thus their overall export potential. What's more, free trade encourages competition, which drives companies to cut costs and improve efficiency, leading to beneficial economic results.

The ongoing cooperation program between Switzerland and Vietnam covers areas that can also help Vietnam implement the FTA successfully and without causing undue concern about possible side-effects, as this program is precisely designed to increase the efficiency and competitiveness of the Vietnamese economy. The Vietnamese government is also actively addressing gaps in education, infrastructure and technology, in order to enhance the competitiveness of the Vietnamese economic system. Switzerland is ready to exchange views with Vietnam on ways in which cooperation in these areas could be strengthened.

The FTA under negotiation can indeed become a powerful tool for further expanding economic interaction between Switzerland and Vietnam in all areas, thus taking our bilateral relations as a whole to a new and higher level.

Reporter: Switzerland is very strong in green industries and has lots of experiences in Fair Energy Transition. In the near future, which recommendations, financial and technological support does Switzerland plan to propose to Vietnam to contribute to the sustainable environmental development and uphold the commitments at COP-26?

Ambassador Thomas Gass: Switzerland is firmly committed to the Paris Agreement and has pledged to reduce greenhouse gas emissions by 50% by 2030. This is driving our industries to adapt, innovate and develop the technologies needed to achieve this goal, which is indeed why Switzerland has become one of the world leaders in green industry and sustainable development. My country is also a pioneer in renewable energies: for example, hydropower, which Switzerland developed decades ago, is still the country's main source of electricity, but also photovoltaics which is experiencing a rapid boom.

Switzerland is an active participant in the United Nations Framework Convention on Climate Change (UNFCCC) and has pledged to increase its financial contribution towards mitigation of and adaptation to climate change, including through the Adaptation Fund and the Green Climate Fund. In terms of direct financial and technological assistance, Switzerland has also provided assistance to several partner countries through a number of instruments that facilitate the adoption of sustainable industrial and development policies. It is worth mentioning that Switzerland is supporting several project in the Mekong Delta region aimed at strengthening the resilience and adaptation of cities to climate change, for example through flood protection in Can Tho city, but also the better management of water resources at local level. Switzerland and Vietnam are also working together to promote the use of clean energy technologies and the transition to a green economy as part of their ongoing cooperation programme.

Achieving net zero is difficult for all countries. Vietnam will need to rapidly build and mobilize its resources and capacities to meet its commitments. At COP28 PM Chinh launched the Resource Mobilisation Plan (RMP) - a key milestone towards the implementation of the Just Energy Transition Partnership (JETP). It includes priority investments, priority policy actions and regulatory reforms to develop an enabling environment for investment, to boost renewables and reduce reliance on fossil fuels.

Important targets are: (i) The projected peaking of all greenhouse gas emissions in Vietnam by 2030; (ii) reaching peak annual power sector emissions of 170 megatons CO2e by 2030; (iii) limiting Vietnam's peak coal-fired generation capacity to 30.2 gigawatts; and (iv) accelerating the adoption of renewables so that renewable energy accounts for at least 47 percent of electricity generation by 2030. Civil society plays a crucial role for the advancement and acceptance of the above-mentioned measures, and the impacts related to the energy transition, and to make sure the necessary transition will be just and inclusive.

Switzerland is well equipped with know-how and technology in these areas, which can open up opportunities for new investments and partnerships between Switzerland and Vietnam.

Reporter: Given Switzerland’s non-permanent membership in the UN Security Council for the 2023-2024 term, what potential and opportunities does Switzerland envisage in fostering cooperation with Vietnam to strengthen the role of multilateralism and uphold international laws?

Ambassador Thomas Gass: As a non-permanent member of the UN Security Council, Switzerland, true to its motto "A Plus for Peace", has tirelessly promoted multilateralism and sought to garner support for ongoing efforts to ensure that international law is always upheld. Over the years, Switzerland has actively offered its good offices to facilitate the peaceful resolution of a number of conflicts, while taking or supporting initiatives aimed at strengthening the role of the United Nations in conflict prevention and resolution. Switzerland also promotes bilateral activities designed to contribute to the consolidation of peace, including through cooperation on sustainable development issues, and seeks to engage partners through bilateral channels in efforts to boost the role of multilateralism, for example by launching initiatives to enhance the role of United Nations bodies involved in peace-building.

Vietnam also makes a much appreciated contribution to international peace and security, for example by participating in multilateral missions in conflict zones and contributing troops to United Nations peacekeeping operations abroad, such as in South Sudan and the Central African Republic. Like Switzerland, Vietnam plays a very active role in disarmament and is a highly regarded participant in the Conference on Disarmament.

Vietnam's commitment to upholding and strengthening international law, including the law of the sea, makes it an important promoter of peace and security. In line with its commitment to dialogue and cooperation on security issues to ensure peace and stability in the Asia-Pacific region, Vietnam is also a key participant in the ASEAN Regional Forum.

The importance that Switzerland and Vietnam attach to the promotion of peace and security, in particular through multilateralism, somehow predestines both countries to seek greater mutual engagement and closer cooperation to support each other in our respective initiatives in this field, which are complementary in several respects, both through multilateral channels and through our regular bilateral dialogue. This is an area where I can certainly see untapped potential for expanding our already productive cooperation. Perhaps we can seize the 70th Anniversary of the 1954 Geneva Conference as an opportunity to do so.

Reporter: From January 16-19, Prime Minister Pham Minh Chinh along with the Vietnamese high-level delegation is set to participate in the 54th annual conference of WEF in Davos, Switzerland. How do you anticipate this event providing Vietnam with opportunities to voice its stance on global issues as well as to attract support from the community of investors for sustainable economic development goals?

Ambassador Thomas Gass: Although Switzerland hosts the World Economic Forum in Davos, the Swiss authorities have no role in setting the agenda for the meeting. However, by engaging the private sector and providing a visible opportunity to interact with world leaders, the World Economic Forum can make an important contribution to addressing the complex challenges facing the world, as the Forum provides a much-needed platform for dialogue where focused, fit-for-purpose partnerships can take shape. The problems posed by the myriad disruptive changes taking place around the world and the urgent challenges we must overcome to ensure a livable planet for all, in particular the race to contain climate change, cannot be solved by governments alone. All truly effective solutions will inevitably require significant investment, which can only be realised with the active involvement of civil society and the business sector.

With its rapidly growing economy and mounting presence on the global stage, Vietnam is playing an increasingly important role, not only in the region but also beyond. In this context, it is all the more important for Vietnam to maintain and strengthen its determination to engage in continuous dialogue with the international community and share with others its approach, perspectives and experiences.

It is very significant that Prime Minister Chinh led a large delegation to the WEF meetings in Davos. At a World Economic Forum event in China in June 2022, Prime Minister Chinh reminded participants of the need for “global solidarity, multilateralism and a people-centred approach in the face of strong headwinds”. Vietnam can speak with confidence as it has made significant contributions to addressing various global issues and its efforts enjoy the full appreciation of the international community, as demonstrated by the growing number of countries entering into partnership relations with it. It is also worth noting that this year's WEF places a strong focus on artificial intelligence, which brings innumerable hopes but also challenges and even obvious threats, as the risk that it might lead to the spreading or the use of misleading or false information cannot be excluded, which in turn might entail potentially disastrous consequences. Bearing in mind the ongoing effort to transform Vietnam into a knowledge-based economy one, I noted with great interest that Prime Minister Chinh met with a number of information technology leaders in his agenda on the sidelines of the WEF.

Reporter: During your term, how do you plan to further the role of Switzerland as at gateway in promoting the growth of Switzerland-Vietnam’s relations, especially in areas such as investment, economics, science and technology, education and training, and climate change? Your efforts are crucial in fostering a sustainable and active cooperative relationship between the two nations.

Ambassador Thomas Gass: Vietnam's dynamic foreign policy and robust economic growth is driving countries to queue up in order to set up partnerships with Vietnam or upgrade the ones they already have, and of course I would like Switzerland to do the same, which is why I am following this issue very closely.

Since I took office a year ago, I have made every effort to build new momentum for the negotiations on a free trade agreement between the European Free Trade Association (EFTA) and Vietnam. I am very pleased to see that these negotiations are now moving forward again. Once the agreement enters into force, it will provide a much stronger basis for raising the level of our relations, since it will pave the way for increased Swiss direct investment in Vietnam, while further stimulating and diversifying our bilateral trade. The updated bilateral investment protection agreement between Switzerland and Vietnam will be an equally important, additional instrument to achieve this result.

The recent entry into force of a new framework credit has also given fresh impetus to Switzerland's existing economic cooperation with Vietnam, which since 2008 has focused on improving public finances, strengthening the financial sector, increasing the competitiveness of small and medium-sized enterprises (SMEs), urban planning and climate resilience, and promoting sustainable growth projects. I am personally committed to proactively engaging with all of our partners across the country and developing my personal relationships with them.

In the field of scientific cooperation, the Vietnamese National Foundation for Science and Technology Development (NAFOSTED) and the Swiss National Science Foundation (SNSF) have established a close partnership, through which they support together joint Swiss-Vietnamese research projects that pursue excellence. In this context, I am working to enhance our mutual cooperation in this promising field by expanding my network in the country.

My ambition for further enhancing and deepening our bilateral relationship is very high, and you can be certain that I will continue to work tirelessly in this direction.

Reporter: Thank you very much!

Bich Lien