SEMBCORP Industries and long-standing partner Becamex IDC will co-establish five Vietnam Singapore Industrial Parks (VSIPs) in Vietnam, valued at approximately US$1 billion.

The memorandum of understanding (MOU) was one of several exchanged at the Vietnam-Singapore Business Forum on Friday (Feb 10) at Shangri-La Hotel. The event was witnessed by Vietnamese Prime Minister Pham Minh Chinh and Second Minister for Trade and Industry Tan See Leng.

Sembcorp said that the VSIPs are envisioned to be smart and sustainable industrial parks with low carbon footprint. Real-time tracking devices will remotely monitor and manage energy, water and waste use, as well as traffic and security, to allow for enhanced visibility over operations.  

The MOU includes an investment licence to develop a 500 ha VSIP in Nghe An province (park II). The licence is an expansion of the original 750 ha VSIP Nghe An (park I), which was established in 2015. Nghe An province is located in Vietnam’s northern central region and plays a supporting role to the capital of Hanoi. 

Today, there are 12 parks across Vietnam, and together they have attracted US$18.4 billion in investments and created over 288,300 jobs in the industrial service sector. The latest MOU takes the total number of VSIPs to 17.

In his keynote address which was delivered in Vietnamese, Chinh said that the VSIPs are “testament to the flourishing ties” between Vietnam and Singapore. “This is built on the underlying principle of shared risk and harmonious interest,” he noted. He added that this basis of trust has allowed security cooperation to be boosted with “greater trust” and that it allows countries to “share experiences, bolster each other’s potential, step up exchanges and meetings in a more favourable manner”. “This is of course also conducive to peace and cooperation in the region.”

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Separately, Keppel Land and Khang Dien Group signed an MOU to collaborate on the development of residential projects, as well as sustainable urban developments in Ho Chi Minh City; and Vietnam Airlines and Singapore Airlines (SIA) signed an MOU to explore opportunities for codeshare arrangements between Vietnam and Singapore, and potentially other destinations that SIA serves. Both MOUs were also exchanged at the forum.

Dr Tan noted in his opening speech that Singapore’s economic relations with Vietnam are “strong, substantive and underscored by multi-faceted cooperation in diversified sectors”. Singapore companies such as Mapletree, YCH Group, Charles & Keith and BreadTalk have also contributed to Vietnam’s infrastructure, transport, logistics, food and retail sectors, he pointed out. As at May 2022, Singapore is Vietnam’s second-largest cumulative foreign investor with a stock investment amount of US$68.68 billion.

Standard Chartered Bank said that it too has noticed a substantial increase in Singapore clients (40 per cent increase from 2020) who are looking to the bank to support their Vietnam ventures. The bank is also increasingly partnering new-economy players from Singapore as they tap Vietnam’s national push towards digital transformation.

Speaking at the sidelines of the event, Michele Wee, chief executive officer of Standard Chartered Bank Vietnam told The Business Times that the sense of mutual respect and trust between the two countries (and companies from either country) has helped build a strong foundation. “Culturally, both are extremely hard-working nations and that synergy in the culture and being able to understand each other is quite seamless,” she said. She added that education broadly speaking is another “tremendous opportunity” in Vietnam. “Whether it’s knowledge sharing, technology transfer, or talent management, these are all opportunities for the Singapore-Vietnam corridor,” she added.

At the same forum, a separate announcement was made by Singapore Business Federation (SBF) chairman Lim Ming Yan. He said that SBF will be holding its flagship annual event – the Singapore Regional Business Forum (SRBF) – in Hanoi, Vietnam, this year. This is the first time the event is being held overseas. This will be the seventh SRBF, and the theme is “Strengthening regional collaboration for sustainable growth”. The one-day event will comprise four plenary sessions, ministerial dialogues, MOU signings and business matching/networking sessions.