TOKYO -- Construction of a Vietnamese nuclear power plant will begin this year with the assistance of Japan and other countries as planned, President Truong Tan Sang said Monday.
In an interview with The Nikkei in Tokyo, Sang brushed off speculation that construction of Southeast Asia's first nuclear plant will not begin on time because of financing difficulties and delays in passing necessary legislation. He also urged Japan to fully assure the facility's safety in light of growing public awareness of the risks involved.
Facing electricity shortages, Vietnam is eager to build a nuclear power plant to advance economic development. Sang is scheduled to meet with Prime Minister Shinzo Abe on Tuesday to discuss maritime security and economic cooperation.
Edited excerpts from the interview follow.
Q: Last year marked the 40th anniversary of diplomatic ties between Japan and Vietnam. What is the main purpose of your visit to Japan? How do you see the current relationship between the two countries, and how can it be strengthened? Could you explain the potential for bilateral cooperation in economics, trade and investment?
A: Over the past years, bilateral ties between Vietnam and Japan have seen robust and comprehensive development. In 2009, the two countries established a Strategic Partnership for Peace and Prosperity in Asia, with a high degree of consensus between the two states -- parliaments, governments and the broad support of the people in both countries.
It can be said that relations between our two countries have reached an all-time high since diplomatic relations were established. Mutual understanding and trust between the two sides have been deepened, and this represents a valuable shared asset for both nations.
I note with pleasure that Japan is now a leading partner of great importance to Vietnam, the biggest investor and the third-largest trading partner of Vietnam. In 2013, bilateral trade turnover reached more than $25 billion. The two sides have been implementing effectively a number of large-scale cooperation projects that are of great significance to Vietnam's socioeconomic development. By the end of 2013, Japan topped the list of countries investing in Vietnam, with more than $34.5 billion of registered FDI. Japan's total ODA commitments for Vietnam have reached $23 billion.
Building on the strongly growing bilateral cooperation over recent years, during this visit to Japan, I will discuss with Japanese leaders the upgrading of bilateral ties to a new level. This is in line with the ongoing excellent relations between the two countries, contributing to peace, stability, cooperation and development in the region and the world. Vietnam wishes to further deepen and expand comprehensive cooperation with Japan in all areas, focusing on economics, trade and investment cooperation through the following actions:
First, work together to implement Vietnam's industrialization strategy within the framework of Vietnam-Japan cooperation through 2020, and vision through 2030, focusing on six industries selected by the two sides: agricultural machinery; processing of food and agricultural-aqua products; electrical goods and electronics; shipbuilding; environment and energy efficiency; automobiles and autoparts.
Second, strengthen cooperation in trade and investment. It is Vietnam's wish that Japan work closely with us to achieve the goal of at least doubling trade turnover by 2020, as stated in the Joint Statement in 2011, and to effectively implement the Japan-Vietnam Economic Partnership Agreement (VJEPA). Vietnam highly values the role of the Japanese private sector in economic cooperation, hence, our wish for Japanese companies' increasing investment in Vietnam. We look forward to the increasing participation Japanese investors in public-private partnership (PPP) projects in Vietnam.
Third, Vietnam looks forward to Japan's sustained and increased ODA and support for Vietnam to effectively implement large-scale projects, particularly those in infrastructure, energy, supporting industries, economic restructuring and sustainable growth.
Fourth, strengthen cooperation in agriculture, particularly in research and development of new technologies, response to climate change and development of human resources for sustainable development.
Fifth, on the multilateral framework, we look forward to close cooperation to promote regional economic integration, including the negotiations for the Trans-Pacific Partnership Agreement (TPP) and the Regional Comprehensive Economic Partnership (RCEP).
Cultural and people-to-people exchanges have been intensified, particularly on the occasion of the 40th anniversary of the establishment of bilateral diplomatic relations, and these have truly become a bridge of friendship between our two nations, creating opportunities for the Vietnamese and Japanese people, especially the young generation, to have exchanges and understand each other's culture, history and traditions.
The Vietnamese people greatly admire the Japanese people's resilience and bravery which have been reflected in your efforts over the past years to overcome the consequences and losses caused by natural disasters, as well as to build and develop a strong and prosperous Japan. Japanese culture and its delicate culinary arts are very familiar to the Vietnamese people.
On this occasion, on behalf of the people of Vietnam, I would like to extend my best wishes to the Japanese people. May the strategic partnership between Vietnam and Japan be ever strengthened and the friendship between our two peoples ever tightened.
Q: What kind of role does Asean expect Japan to play in terms of the economy, politics and international relations in the region?
A: Japan is one of the most long-standing dialogue partners of Asean, with the dialogue established in 1973, and the framework for a strategic partnership established in 2003. In 2011, Japan and Asean adopted the Joint Declaration for Enhancing Asean-Japan Strategic Partnership for Prospering Together. Japan is always one of the most important trading partners of Asean, and one of its biggest FDI and ODA donors. Social and cultural cooperation between the two sides have also made great strides. The achievements of the past 40 years testify to the political will and tremendous efforts from both sides and have laid a solid foundation for elevating the Asean-Japan strategic partnership to new heights.
As strategic partners, ASEAN stands ready to work with Japan for peace, security, stability and prosperity in the region. In the coming years, I believe the two sides should take the following actions:
First, raise resources to deliver on the existing commitments, agreements and cooperation programs, with high priority given to supporting Asean in successfully building the Asean Community in 2015.
Second, intensify economic, trade and investment cooperation, with a view toward doubling two-way investment and trade flows by 2022 through implementation of the Asean-Japan 10-year Strategic Economic Cooperation Roadmap. and early conclusion of the Asean-Japan Comprehensive Economic Partnership (AJCEP), so as to move toward establishment of a comprehensive Asean-Japan Free Trade Area, and negotiation with Asean on the Regional Comprehensive Economic Partnership (RCEP).
Third, support regional economic integration, Asean connectivity, sustainable development in the Mekong subregion, including sustainable and rational use and management of water resources, enhancement of people-to-people exchanges, et cetera.
Fourth, promote dialogue and consultation; build trust; ensure freedom security and safety of aviation and maritime activities in the region; seek peaceful settlement to disputes; and strictly observe international law.
Over the past four decades, Asean-Japan partnership has recorded enormous progress of strategic importance to the region. Asean looks forward to Japan's continued support for Asean's centrality in the regional architecture, and will work closely with Japan in regional and international forums, including the EAS, ARF, ADMM-h EAMF and APEC, ASEM and the United Nations.
Q: Recently, Japan has had a dispute with China, which set up an air defense identification zone in the East China Sea. How can the two countries resolve this issue? Other issues, including maritime, sovereignty and territorial issues, are causing tensions among Asian countries. What is Vietnam's policy for resolving these disputes?
A: Peace and stability represent the common interest, aspiration and goal of all countries within and outside the region in order to maintain sustainable development and prosperity in the Asia-Pacific. We are following closely and with deep interest the developments in the East China Sea, as well as the concerns of the parties involved. It is our hope that the countries concerned will satisfactorily resolve outstanding disagreements caused by territorial, sovereignty, sea and island disputes through peaceful dialogue on the basis of international law, thus contributing to peace, stability, cooperation and development in the region and the world. We are ready to work with other Asean members and partners in the region and the world to contribute to joint efforts for the maintenance of peace, stability, and maritime and aviation security and safety in the region.
Vietnam's consistent policy is that all territorial disputes, including the disputes in the East China Sea and South China Sea, be resolved by peaceful means on the basis of the international law, particularly the 1982 U.N. Convention on the Law of the Sea, to achieve a lasting, fair solution which meets the interests of all parties concerned, thus actively contributing to the maintenance of peace, stability in the region and the promotion of friendship and cooperation among nations. At the same time, Vietnam will do its utmost to join hands with Asean and China to strictly implement the Declaration on the Conduct of Parties in the South China Sea (DOC) and to soon bring about a Code of Conduct in the South China Sea (COC).
Q: Vietnam's tight monetary and fiscal policy has curbed inflation, reduced its trade deficit and stabilized the macroeconomy. However, the growth rate is falling. GDP growth in 2013 was 5.42%, the second straight year below 6%. The Vietnamese government set a target of 5.8% GDP growth in 2014, and 6% in 2015. Do you think these targets are attainable? What should Vietnam do to spur the economy?
A: Vietnam has been redoubling its efforts to drastically implement various measures to cope with the challenges caused by the global economic turmoil. With the policies and measures being implemented in the right direction and the efforts of the people, we have managed to control inflation, maintain macroeconomic stability and achieve a decent GDP growth rate. In 2013, economic growth reached 5.42%. Inflation was 6.6%, the lowest level in the last 10 years. In 2014, our overall objective is to maintain macroeconomic stability, hold inflation at 7% per year, and maintain GDP growth rate at an appropriate level of around 5.8%.
In the medium and long term, we are determined to comprehensively implement solutions under the framework of the 2011-2020 Socioeconomic Development Strategy, including:
First, implement three strategic breakthroughs on completing socialist-oriented market economy institutions, developing high-quality human resources and building comprehensive infrastructure.
Second, strengthen economic restructuring, transformation of the growth model towards improving quality, efficiency and competitiveness, focusing on three areas, namely investment restructuring, particularly public investment, restructuring of the financial and banking system, particularly commercial banks, and restructuring of enterprises, particularly state-owned enterprises.
Third, actively integrate into the world to create a favorable environment for economic development, harness development resources and enhance the economy's competitiveness.
Q: Vietnam developed an industrialization strategy last year and chose six priority sectors -- electronics, autos and autoparts, farm machinery, agricultural and fishery processing, shipbuilding, environment and energy conservation. Which sector do you think is the most hopeful? Will Vietnam provide favorable conditions and incentives for investors in these sectors, such as tax reductions? Which sectors do you want Japanese investors to be involved in? What is behind the delays in certain big cooperative projects with Japan, such as Long Thanh International Airport and the high-speed north-south railway?
A: With a view to attaining basic industrialization and modernization by 2020, for the past few years, Vietnam has been focusing efforts on attracting high-quality foreign investment with modern and environmentally friendly technologies, effective use of natural resources including minerals and land in such areas as supporting industries, especially those related to agriculture, processing and high-tech industries, et cetera. We have implemented various measures to improve the business environment and provide more incentives to foreign investors, such as tax exemptions and reduction for investors in priority areas.
Building on the development of excellent relations and multifaceted cooperation between Vietnam and Japan, the ongoing trend of outbound investment by Japanese firms has presented a great opportunity to attract Japan's FDI to Vietnam. The government of Vietnam also works to create favorable conditions for Japanese companies to invest and do business in Vietnam. The two sides have actively implemented measures to promote Vietnam's industrialization under the Vietnam-Japan cooperation framework though 2020 and vision through 2030. I hope that Japanese businesses will take advantage of these favorable conditions to promote investment projects in, among others, the six priority areas, contributing to enhancing technology and skills for Vietnam's industries and the economy as a whole.
Vietnam and Japan have been effectively implementing large-scale infrastructure projects, making significant contributions to the development of the Vietnamese economy and society. Projects in infrastructure, especially transport, have accounted for a large proportion of ODA cooperation between the two countries. In the near future, transport infrastructure will continue to be a priority area for Vietnam. We would like to seek Japan's cooperation and support.
Long Thanh International Airport and the North-South Express Railway are both large-scale and important projects. They are now under thorough consideration to ensure the cost-effectiveness of the investment.
Q: After the accident at the Fukushima Daiichi nuclear power plant in Japan, demand for safety has grown among the Vietnamese people. Did this situation affect plans for Vietnam's first nuclear power plant? Do you think the start of construction in 2014 and the start of operation in 2020 will be delayed? When do you expect the plant to go online? What sort of cooperation from Japan is expected in terms of nuclear power plants?
A: lt is Vietnam's consistent policy to use and develop atomic energy for peaceful purposes and for socioeconomic development. That use and development must be absolutely safe for the people and the environment. In the development of atomic energy, the first priority is given to state-of-the-art technology and safety.
The government of Vietnam has chosen Japan as a cooperation partner in building Ninh Thuan Nuclear Power Plant No. 2, based on a technological assessment (of Japanese quality), especially in terms of safety and the operational experience of nuclear power plants in Japan.
Currently, relevant agencies of the two sides are working closely to decide on the best option to ensure the effective use of nuclear energy for sustainable economic development and highest level of nuclear safety and environmental protection.
From the perspective of energy security and environmental protection, on the basis of the achievements recorded during the process of cooperation in using nuclear energy for peaceful purposes, we would like to enhance bilateral cooperation in nuclear energy and upgrade it to a higher level. Vietnam and Japan should closely coordinate to effectively implement the cooperation agreements, including Japan's active support in human resource training and development of legal documents to complete the legal framework for the management of the atomic energy sector in Vietnam.
Q: The negotiations for the Trans-Pacific Partnership face some difficulties. What are the challenges for Vietnam in the TPP negotiations? Do you think Vietnam needs any exemptions or moratorium periods to introduce the TPP rules? How can the 12 countries participating reach agreement?
A: When deciding to join the TPP negotiations, Vietnam foresaw challenges in the future and we are ready to make necessary adjustments based on achieving a balance between opportunities and challenges. Joining the TPP will create pressure for market liberalization and increase competition for Vietnamese enterprises. Without thorough preparation, many production and service sectors will face difficulties. In order to implement its commitments under the TPP, Vietnam will have to revise and develop regulations on trade, investment, public tenders, intellectual property, et cetera. Sooner or later, Vietnam will have to go down that road if it is to be successful in restructuring its economy toward higher added value and quality of economic growth.
Since Vietnam is a country at a lower level of development than the other TPP members, our accession to and success in the TPP will help raise the diversity of the members. It will showcase the fact that the TPP is more than a high-level cooperation mechanism. It is capable of harmonizing the interests of economies at different development levels.
Therefore, we believe that apart from aiming at high standards, the TPP should maintain a balance between the rights and obligations of each negotiating partner. Vietnam hopes that other countries will give flexibility to Vietnam's important sectors, such as garments and footwear, and give our country a reasonable transition time, as well as providing technical assistance in negotiations and implementation. This will enable us to gradually enhance our capacity to meet the TPP's high standards. It is also consistent with the principle of "for development" promoted by the TPP members.
With a strong commitment to international economic integration, Vietnam shares the goals of the TPP and firmly believes in its ability to make a positive contribution to this process. By participating in the TPP negotiations, Vietnam would like to show its commitment to reform and comprehensive regional and international economic integration. We also aim to demonstrate our aspirations to make contributions to strengthened economic linkages for peace, cooperation and development. Vietnam hopes to join other countries in building a framework for long-term economic partnership, contributing to the process of economic integration in the Asia-Pacific region and the world.
The TPP is a diverse agreement. Its members are at different levels of economic development and have different political systems. The TPP is also considered the "21st-century agreement" with broad and extensive commitments and a very high level of liberalization. Therefore, in order for the 12 countries to reach an agreement, it is our view that the TPP should ensure the balance between the rights and obligations of the parties, while respecting differences and country-specific conditions.