Trade pact boosts Vietnam-Finland relations
Vietnam and Finland have become sustainable partners since the establishment of diplomatic relations. In particular, trade and investment relations between Vietnam and Finland have developed rapidly thanks to the EU-Vietnam Free Trade Agreement (EVFTA), which entered into force one year ago, as well as a bilateral framework agreement on the use of Public Sector Investment Facility (PIF).
Positive growth
In the first half of 2021, two-way trade reached US$285 million, an increase of 61.2 percent compared to a year ago. Of the total, Vietnam’s exports reached US$168.5 million, doubling the figure recorded in the same period last year, with the main items being iron and steel, footwear, machinery and equipment, garments and textiles. Meanwhile, imports reached US$116 million, a year-on-year increase of 20 percent, with the main products being machinery and equipment, wood, chemical products and electronics.
Vietnam and Finland have also witnessed close cooperation in industry, energy, education and health. The EVFTA is considered a driving force for promoting economic and trade relations between Vietnam and the EU in general and between Vietnam and Finland in particular. At a recent meeting with Finnish Ambassador to Vietnam Kari Kahiluoto, Vietnamese Minister of Industry and Trade Nguyen Hong Dien said that thanks to the favorable legal framework of the EVFTA, as well as greater efforts by both governments and business communities, trade and investment relations between the two countries will continue to develop strongly. Dien also said Finland’s early ratification of the EU-Vietnam Investment Protection Agreement (EVIPA) will encourage Finnish businesses to expand investment in Vietnam in priority fields, such as industry and energy.
Ambassador Kahiluoto praised the role of the EVFTA in promoting trade relations between the two countries, affirming that the embassy is working with customs authorities to facilitate trade in goods between the two sides.
Public sector investments
At the meeting, Kahiluoto reported to the Vietnamese side on progress of a bilateral framework agreement signed on January 21, 2021, under which Finland will provide more than US$100 million for Vietnam’s public investment projects.
The agreement plays an important role in promoting cooperation between the two sides and bringing Vietnam-Finland relations to new heights, shifting from official development assistance to mutually beneficial cooperation. The agreement proves the trust of the Finnish government in Vietnam’s management capacity, project implementation and strong development potential.
The PIF supports public sector investments in developing countries in line with the United Nations’ sustainable development goals (SDGs) and utilizes Finnish expertise and technology. It supports investment in projects, such as water supply, environmental sanitation and protection, climate change response, energy and clean technology.
The PIF will provide Vietnam with additional public funding, and broader access for Finnish companies with years of experience, expertise and suitable technology solutions to the Vietnamese market.
Minister Dien said the Ministry of Industry and Trade in coordination with the Ministry of Finance will devise optimal plans to use this funding.
