Vietnam is a potential investment destination, with many available opportunities now await Australian investors to grab their own, Vietnamese Prime Minister Nguyen Xuan Phuc told the Vietnam-Australia Business Forum in Sydney on Friday.

The forum is the most important investment promotion event in the framework of the Vietnamese head of government’s official visit to Australia from March 14 to 18.

During the event, PM Phuc and government officials of the two countries witnessed the exchange of 18 memoranda of understanding on investment cooperation between their enterprises and organizations.

Speaking to an audience of hundreds of Vietnamese and Australian enterprises and investors, the Vietnamese premier expressed his pleasure to witness the signing of those agreements, particularly Vietnamese low-cost carrier Vietjet’s plan to open a nonstop Vietnam-Australia service.

“This will make it easier for promoting investment collaboration between Vietnamese and Australian enterprises,” the PM stressed. 

During his visit, Vietnam and Australia have agreed to upgrade of bilateral ties to a strategic partnership level.

The elevated relations, along with the signing of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), to which both Vietnam and Australia are members, are both favorable foundations to open up a new chapter in bilateral relations, according to the premier.

Prime Minister Nguyen Xuan Phuc (right) speaks to Qantas leaders in Sydney, March 16, 2018. Photo: Tuoi Tre

The Vietnamese leader acknowledged that Australian firms still have difficulties in accessing information about Vietnam, thus urging Vietnam’s ministries, sectors and localities to intensify promotion and information exchange, and cut down procedures to bring into full play the two countries’ cooperation potential.

Bilateral trade between Vietnam and Australia was worth some US$6.5 billion, which PM Phuc said is still modest and many Australian firms named in the world’s 500 largest enterprises have yet to be present in Vietnam.

“Investment promotion agencies of both countries should consequently pay attention to boosting bilateral trade and investment ties,” he suggested.

Vietnam logged a GDP growth rate at 6.81 percent and a total foreign direct investment (FDI) inflow of nearly $36 billion in 2017, PM Phuc told his audience, explaining why the Southeast Asian country is a potential market for Australian investors.

Other strengths include the large-scale market of 93 million people, a huge proportion of the population being Internet and smartphone users, and preferential policies for investment. Vietnam’s corporate income rate is currently set at only 20 percent, and is scheduled to decrease to 15 percent following a tax reform roadmap to better serve start-up enterprises, he elaborated.

“Vietnam is also offering tax incentives to investors in high technology, supporting industry, hi-tech agriculture and the fields that generate numerous jobs,” PM Phuc said.

“The country is also speeding up the equitization of state-owned enterprises, which creates opportunities for private and foreign investors to hold shares in these enterprises.”

Attendees listen as Prime Minister Nguyen Xuan Phuc (not pictured) speaks at the Vietnam-Australia Business Forum in Sydney, March 16, 2018. Photo: Tuoi Tre

Following the Vietnamese leader’s speech, James McGrath, Assistant Minister to the Australian Prime Minister, remarked that Vietnam has become a dynamic economy, with a growth rate among the highest in the world.

The Australian senator expressed his belief that bilateral trade between the two countries will continue increasing in the coming years, credited to Vietnam’s improved investment climate.

The CPTPP, signed in New Zealand on March 8, will bring comprehensive benefits to all member nations, and it is also an impetus for the regional economic reform process, according to McGrath.

The senator said it is time for Australian firms to study the Vietnamese market so as not to miss out opportunities in the country. On the other hand, Australia also hopes to welcome more Vietnamese investors in the time head, he added.

Vietnam is now the 15th largest trade partners of Australia, while Australia is the seventh biggest trade partner of Vietnam, according to the Vietnam News Agency.

Australia companies have so far invested $1.9 billion USD in Vietnam.