On February 24, Vietnamese President Nguyen Xuan Phuc paid his first state visit to Singapore since the outbreak of the COVID-19 epidemic in early 2020.
During the three-day visit, Singapore and Vietnam signed five agreements and memoranda of understanding (MoUs) on defense, trade, and strengthening cooperation in the digital economy, intellectual property and social sectors.
Memorandum of Understanding on Trade and the Digital Economy
The highlight for investors was the MoU on trade and digital economy cooperation, which covers areas such as support for regional and global supply chain connectivity and continued trade flows between the two countries in times of crisis.
It will strengthen agro-trade cooperation by supporting the exchange and training of best practices, certifications and standards in the agro-industry with a view to enhancing greater cooperation between Singapore and Vietnamese SMEs.
Also, both countries signed an implementation work plan on intellectual property (IP) derived from a memorandum signed in 2014. Cooperation will include exchange of IP training and commercialization.
It also mentions the finalization of a proposed launch of a Pilot Collaborative Search and Examination (CS&E) program. The program will encourage the exchange of best practices between the intellectual property offices of both parties, among other initiatives.
Exercise intellectual property rights
For investors, the program will prove to be beneficial as it enhances the application of intellectual property rights which is a big challenge for foreign investors, especially in the high-tech sector.
In addition to the state visit, 29 business memoranda of understanding have been signed between the provinces and businesses of Vietnam, with a total registered capital of approximately 11 11 billion. Vietnam and Singapore have also reached an agreement on vaccine certification, paving the way for safe resumption of commercial flights between the two countries.
These agreements and memoranda of understanding laid the groundwork for the recovery of the two countries’ economies, as well as strengthening and opening up more opportunities for Singaporean investors to invest in Vietnam.
According to the Ministry of Planning and Investment (MPI), Vietnam received US $ 19.74 billion in foreign investment in 2021. For two consecutive years in 2020 and 2021, Singapore has injected the largest amount of FDI into Vietnam. After Singapore, Japan had invested 2 3.2 billion, followed by China, Hong Kong and Taiwan. It is important to note that a number of multinational companies invest in Vietnam through their Singapore operations. For example, US MNCs, like Intel and PNG, have invested in Vietnam through Singapore.
Foreign direct investment in Vietnam increased by 7.2 percent year-on-year to US $ 2.68 billion in January-February 2022. Of these, Singapore was the top source of FDI commitments, followed by South Korea and China.
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