Working Toward the Development of the Mekong Region
Viet Nam
March 2009
1. Politics
With the invasion of Cambodia by Vietnamese forces at the end of 1978, Japan restrained economic cooperation to the Socialist Republic of Viet Nam from 1979 onward. But in November 1992, in the light of Viet Nam's peace agreement with Cambodia in October 1991, Japan extended yen loans of up to 45.5 billion yen.
Relations between the two countries have become closer since Prime Minister Vo Van Kiet's visit to Japan in March 1993, and mutual visits by leaders have become more frequent. In June 1999, Their Imperial Highnesses Prince and Princess Akishino became the first members of the Japanese Imperial Family to visit Viet Nam. The 30th anniversary of the establishment of diplomatic relations was marked in 2003 with a variety of exchange events held in both countries to commemorate the occasion. In June 2004, Prime Minister Phan Van Khai visited Japan, and in July of the same year Japanese Minister for Foreign Affairs Yoriko Kawaguchi made the first official foreign ministerial visit to Viet Nam in eight years. During her visit, the two countries' foreign ministers announced the Japan-Viet Nam Foreign Ministers' Joint Statement toward a Higher Sphere of Enduring Partnership. In October, Japanese Prime Minister Junichiro Koizumi and Minister for Foreign Affairs Nobutaka Machimura paid a visit to Viet Nam to attend the fifth Asia-Europe Meeting (ASEM 5). Minister of Foreign Affairs Nguyen Dy Nien visited Japan in March 2005 and also in May 2005 on the occasion of the seventh ASEM Foreign Ministers' Meeting in Kyoto. In June, Minister for Foreign Affairs Machimura visited Viet Nam, and in July Prime Minister Khai held talks with Prime Minister Koizumi. In October 2006, Prime Minister Nguyen Tan Dung visited Japan on his first official visit since taking office. During his visit, he and Japanese Prime Minister Shinzo Abe agreed upon and announced the Japan-Viet Nam Joint Statement toward a Strategic Partnership for Peace and Prosperity in Asia, the first joint declaration between the two countries at the prime ministerial level. In November 2006, Prime Minister Abe visited Viet Nam to attend the 14th Asia-Pacific Economic Cooperation (APEC) Economic Leaders' Meeting. After the meeting, he remained in Viet Nam for an official visit. In addition to holding talks with Prime Minister Dung, Prime Minister Abe, along with a Japanese business mission to Viet Nam of over 130 members, attended a meeting organized for the leaders and business communities of both countries. In May 2007, Deputy Prime Minister and Foreign Minister Pham Gia Khiem visited Japan to pay a courtesy call to Prime Minister Abe and to co-host the first meeting of the Japan-Viet Nam Cooperation Committee--the establishment of which had been agreed on in a bilateral summit meeting--with Minister for Foreign Affairs Taro Aso. In November 2007, President Nguyen Minh Triet visited Japan as the first state guest from Viet Nam. During this visit, he and Prime Minister Yasuo Fukuda announced the Joint Statement on the Deepening Relations between Japan and Viet Nam, including a 44-item Agenda toward a Strategic Partnership between Japan and Viet Nam.
The 35th anniversary of diplomatic relations between Japan and Viet Nam was marked in 2008. Over the course of the year, many events were held in both countries to commemorate the anniversary, including a Japanese-Vietnamese musical festival in Viet Nam and a Viet Nam Festival in Japan.
In February 2009, on the occasion of the 35th anniversary of diplomatic relations between Japan and Viet Nam, His Imperial Highness Crown Prince Naruhito traveled to Viet Nam for the first time at the invitation of the Vietnamese government. While there he paid a courtesy call on President Triet and visited Hanoi, Da Nang, Hoi An, Hue, and Ho Chi Minh City.
2. Economy
Japanese corporate expansion into Viet Nam gained momentum starting in the 1990s, and the resulting "Viet Nam boom" continues today. Reasons for this growth in activity include the improvements in Viet Nam's investment environment since 2003 as a result of the Japan-Viet Nam Joint Initiative, as well as a trend of moving production bases to Viet Nam as China's economic growth led to higher labor costs there. Viet Nam is geographically close to Japan and offers a young, plentiful workforce with low labor costs. Moreover, in December 2008 the two countries signed the Japan-Viet Nam Economic Partnership Agreement, which is expected to lead to further vitalization of the bilateral economic relationship.
(1) Trade with Japan (2007 preliminary figures)
A. Trade Volume
Exports: 6.14 billion dollars (up 17.4% over the previous year)
Imports: 6.12 billion dollars (up 30.2% over the previous year)
B. Principal Products
Exports: Crude oil, fish and shellfish, textiles
Imports: Machinery and equipment, iron and steel, electrical machinery
(2) Direct Investment from Japan (Cumulative Total, 1988 to March 2008)
943 projects totaling 9.82 billion dollars (authorized amount)
(3) Establishment of JETRO office (September 1993), OECF office (January 1995, now JBIC), and JICA office (May 1995); visits by Keidanren delegations (February 1993, April 1994, February 1995, September 1996, October 2000, April 2002, February 2006, and November 2006)
3. Economic Cooperation
Japan's Assistance
Economic cooperation resumed in November 1992. Japan is Viet Nam's largest donor country; it provided approximately 105.2 billion yen in yen loans, grant aid, and technical cooperation in fiscal 2007.
Japan's ODA Assistance to Viet Nam (billion yen)
| FY 1999 | FY 2000 | FY 2001 | FY 2002 | FY 2003 | FY 2004 | FY 2005 | FY 2006 | FY 2007 | |
| Yen loans | 101.28 | 70.90 | 74.31 | 79.33 | 79.33 | 82.00 | 90.82 | 95.08 | 97.85 |
| Grant aid | 4.641 | 8.067 | 8.365 | 5.237 | 5.650 | 4.914 | 4.465 | 3.097 | 2.118 |
| Technical cooperation | 6.074 | 7.432 | 7.909 | 6.708 | 5.577 | 5.711 | 5.651 | 5.275 | 5.198 |
Major Donor Countries (2006, based on Development Assistance Committee statistics)
(1) Japan (2) France (3) Germany (4) United Kingdom (5) Denmark
4. Culture
(1) Cultural Grants
Up to fiscal 2006, Japan had implemented 33 cultural grant aid projects, including those for the preservation and environmental maintenance of cultural heritage sites and the purchase of equipment and teaching materials for Japanese language schools, martial arts equipment, television programs, and photographic and filming equipment.
(2) Major Cultural Projects
Viet Nam-Japan Festival (October 1993), Hello! Viet Nam (October 1995), Japan-Viet Nam Cultural Festival (1998), Japan Festival 2006 in Viet Nam (August 2006), Japan-Viet Nam Friendship Music Festival in Hanoi and Ho Chi Minh City (May 2008), Viet Nam Festival 2008 in Japan (September 2008)
(3) Japan-Viet Nam Science and Technology Co-operation Agreement (August 2006)
5. Japanese Nationals in Viet Nam
5,613 (as of October 1, 2007); 824 Japanese companies (as of January 2009)
6. Vietnamese Nationals in Japan
36,860 (as of December 31, 2007; up 13.5% from the previous year)
7. Bilateral Treaties/Agreements
- Aviation Agreement (1994)
- Exchange of Notes on Japan Overseas Cooperation Volunteer Program (1994)
- Agreements on Avoidance of Double Taxation (1995)
- Technical Cooperation Agreement (1998)
- Japan-Viet Nam Investment Agreement (2004)
- Japan-Viet Nam Science and Technology Co-operation Agreement (2006)
- Japan-Viet Nam Economic Partnership Agreement (signed in December 2008)
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