Switzerland’s Ambassador to Vietnam: “Switzerland – Vietnam’s Economic Relation Has Huge Potential to Develop”

Diep Nguyen

Economic cooperation by the Swiss private sector has also been steadily increasing since Vietnam’s Doi Moi opening; there still is a big potential for further growth here.

Switzerland’s Ambassador to Vietnam: “Switzerland – Vietnam’s Economic Relation Has Huge Potential to Develop”
Switzerland’s ambassador to Vietnam - Ivo Sieber
BizLIVE held an interview with Switzerland’s ambassador to Vietnam - Ivo Sieber to get some of his comments on Switzerland – Vietnam diplomatic and economic relation over the course of development and the path to the future of closer cooperation. 
The year 2021 marks an important milestone: Switzerland and Vietnam celebrate 50 years of diplomatic relation establishment and 30 years of development cooperation. Looking back at the development of diplomatic and economic relations, what are the most important moments, in your opinion?
The starting point on 11 October 1971 was of course an important moment: Switzerland was then the second European country (after Sweden) to formally recognize the Socialist Republic of Vietnam. The very first Swiss representation in Hanoi started operating in 1973 in a modest office in the Metropole Hotel. In 1976, the Embassy then moved to its own designated building. Initial cooperation wasmainly focused on humanitarian aspects. From the early 1990s onward, an important program of development cooperation wasinitiated, which continues up to today. 
Until 2016, the Swiss Agency for Development and Cooperation (SDC) made important contributions to poverty reduction in Vietnam. From 2016 onward, development cooperation shifted to supporting sustainable economic development in Vietnam as emerging country. The current program is handled by the Swiss State Secretariat for Economic Affairs (SECO), located within Switzerland’s Ministry of Economy. 
During the past 30 years, over US$600 million have been granted by the Swiss Government to Vietnam; ourlong and trusted development partnership remains one major highlight in our bilateral relations.Economic cooperation by the Swiss private sector has also been steadily increasing since Vietnam’s Doi Moi opening; there still is a big potential for further growth here.The opening in 2015 of a Swiss Consulate General in HCMC and recent high-level visits, incl. a 2019 visit to Vietnam by Swiss Economy Minister (and now President) Guy Parmelin, support this trend, which is reinforced by an increase also in academic and scientific cooperation. 
Since last autumn, Vietnam’s NAFOSTED and the Swiss National Science Foundation (SNSF) are jointly offering grants to researchers from both countries.There is also a growing scope for more multilateral cooperation in the United Nations and beyond: Vietnam now holds a non-permanent seat within the UN Security Council, a role Switzerland aspires to assume for the period 2023-24. Regular political consultations, including constructive exchanges on human rights, underscore the dynamism, richness and strength of Swiss-Vietnamese diplomatic relations.
The FTA between Vietnam and the European Free Trade Agreement (EFTA - including Iceland, Norway, Switzerland and Liechtenstein) has gone through many rounds of negotiations, but has not yet been concluded.. In your view, when will this agreement be signed and how will it pave the way for further cooperation between Switzerland and Vietnam?
Negotiations for a comprehensive free trade agreement (FTA) between Vietnam and the four EFTA countries have been ongoing since 2012, with substantial progress achieved in several areas. It is inherent to such negotiations that their timeline and outcome is difficult to predict. Switzerland, together with its EFTA partners, is optimistic that remaining outstanding issues can be resolved soon and that an ambitious, mutually beneficial FTA can be agreed upon. It would of course be especially fitting for Switzerland if negotiations could be concluded this year, coinciding with the 50th anniversary celebrations of our diplomatic relations.
With a combined GDP of close to US$ 1 trillion and a total trade volume of equal size, EFTA countries are an economic actor to be reckoned with. I’m convinced: an EFTA-Vietnam FTA would not just increase trade flows, it would mainly also spur the inflow of additional high-quality Swiss direct investments to Vietnam, support the countryin its ambitious digital and know-how-oriented transformation processes.
How is Vietnam's investment environment, according to Swiss companies? How do Swiss investors perceive  the trend of foreign investments' moving from China to Vietnam?
The Vietnamese government is continuously undertaking efforts to further improve Vietnam’s business environment. Improvements in the World Bank “Doing Business” ranking are indicative of those efforts. Competitive labor costs, a growing domestic market and Vietnam’s growing network of FTAs do not go unnoticed among Swiss business people. Indeed, quite a few Swiss firms are actively doing business here.
Concerns I get to hear from Swiss companies refer to sometimes slow, cumbersome and partly incoherent administrative procedures, red tape and corruption, lack of enforcement of legislation and of safe dispute settlement mechanisms, as well as eroding freedom of expression and digital privacy rights, which limit the innovation potential. Swiss companies are frequently active in high-end products with a high research content, and for those, protection of intellectual property rights, together with predictable legislation, a fair level-playing field and non-discrimination, are important requirements in all foreign countries in which they do business.
Swiss direct investments in Vietnam currently amount to over US$ 2 billion. Switzerland is indeed one of the larger European investors in the country, with a major potential to grow. In the USA for example, Switzerland is the 7th largest foreign investor. The more than 100 Swiss companiescurrently active in Vietnam together created some 20’000 jobs in a wide variety ofsectors, incl. pharmaceuticals, machinery, food processing, IT, logistics, architecture, etc.
There is a broader range of areas, including in infrastructure and services, where Swiss firms have competitive expertise and the potential to contribute to the modernization and further development of Vietnam. Sectors like finance and insurance, digital economy, transportation, energy and renewables, clean-tech, the development of social and commercial infrastructure, engineering services come to mind.
As far as I know, you used to be the Swiss Ambassador in Thailand, Cambodia, Laos, what are your feelings when working in Vietnam - another South East Asian country. What do you think about Hanoi and Ho Chi Minh City?
After spending a total of more than 14 years representing Switzerland as a diplomat in ASEAN countries, the region in its historic, cultural, social and political diversity has deeply inspired and enriched me. I first travelled to Southeast Asia as a student in 1977, only two years after Vietnam’s reunification and with the Cold War making the region a hot-bed for big-power competition.
While my first trip took me to Singapore, Malaysia and Thailand, I have since visited all ASEAN countries, most of them numerous times. I also lived for extensive periods of time in Thailand, the Philippines, Malaysia and now in Vietnam. Looking back over the past four decades and seeing the impressive socio-economic and political transformation of the region, optimism surely is in place. 
Since Vietnam embarked on its economic opening in the 80s, its achievements in poverty reduction and economic reform have been impressive. Hanoi and Ho Chi Minh City clearly are the most striking examples of this progress, even if the rapid growth, modernization and urban development also comes with a hefty price in the form of heavy environmental degradation and new challenges that require at least a partial change of directions. My hope would be for Vietnam to invite all young researchers from the world to come, meet with counterparts here and contribute ideas and suggestions on how best to match economic aspirations with the maintenance of a high-quality and healthy environment for the society in Vietnam.
What do you think about the Covid-19 pandemic control in Vietnam?
Thanks to its rapid reaction, a far-reaching closure of the country and high discipline among Vietnamese people, the government managed to successfully limit the spread of the virus in the country. On the health side, this strategy has had positive results; on the economic side, there have of course been costs, especially in the informal economy and in particular sectors, tourism being one of those heavily affected. 
While the full long-term impact on the Vietnamese and world economy is impossible to predict, the pandemic has revealed to us all the fragility of our society, economy and environment. The post-Covid world will and should not be the same as before. We all need to seize this opportunity to reviewunsustainable ways of consumption and production and to innovate with new ones.
Thank you for sharing!