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Deputy PM, FM Minh's full remarks at 25th Int'l Conference on Future of Asia

VGP - The following is the full remarks of Deputy Prime Minister and Foreign Minister Pham Binh Minh at the 25th International Conference on the Future of Asia in Tokyo on May 30, 2019.

05/30/2019 17:54

Ladies and gentlemen,

At the outset, allow me to extend my warmest congratulations to His Majesty Emperor Naruhito, and express my belief that the Japanese people shall achieve even greater heights in national development during the new Reiwa period. May your country remain ever beautiful as your blooming spring under the shade of the cherry blossom.

It is my great pleasure to address the 25th Future of Asia conference – a leading regional forum for policy dialogue – to discuss emerging trends, opportunities and challenges that our world is facing today, and share with you Viet Nam's efforts to contribute to the common cause of peace and prosperity.

Allow me to make my contribution to our theme of “Seeking a new global order – overcoming the chaos”, as follows: 

1. A new phase with its various uncertainties and challenges

We are entering a phase of considerable political, social and economic uncertainty. The world is undergoing the most rapid and irreversible transformation ever seen in history. This stems from the shift in global economic power from West to East and North to South, the exponential technological advancements and changing demographic patterns.

Uncertainties have intensified considerably due to many challenges faced by the global economy: from trade spats between the world’s largest economies, the stagnation of international trade, the enormous burden of debt to climate change, disruptive technology, and flashpoints of conflict all over the world. Growing inequality and nationalism has fanned the flames of anti-globalization sentiments, thus undermining the multilateral trading system that has been built over the past decades.

These changes and challenges have profound impacts on global economic governance, as well as the relationship between nations and regions. No country, large or small, can alone address these challenges – they require the collaboration of the entire international community.

Against this backdrop, a multiplex world order with multiple key actors entangled in complex forms of interdependence, is taking shape. Globalization, too, is gradually moving into a new phase, driven by the vigorous 4th Industrial Revolution. 

2. A long-term vision and cautious optimism

A long-term vision that goes beyond short-term risks and volatility, would lend itself to a more comprehensive evaluation. I wish to underline three important factors that shall drive global economic growth in the upcoming future:

First, the world economy has become dramatically more integrated and connected than it was before. Financial linkages are growing stronger, while value chains are expanding to the global scale. Digital connectivity has grown tremendously. The phenomenal growth of ICT is opening up unprecedented opportunities for global connectivity and innovation.

Second, the fundamental drivers for growth – labor, capital and technology – remain strong. History has proven that it is these drivers that had helped the world economy recover after the two World Wars and various episodes of economic crisis and recession over the last century.

The young population in developing countries shall be a wealth of labor to fill in the gap of aging population in developed countries, and will contribute to the global economic transformation. Investment capital will grow due to the increased income and savings of the people. Technological advances and technology transfer shall help increase productivity in developing countries; this shall be the main driver for growth in the long run.

Third, global achievements in all aspects of life over the last century have laid the crucial foundation for the next period. For the first time in history, the middle class accounts for more than 50% of the world population. This development process has helped us better understand the nature and cause of our challenges and establish vital institutions for collaboration to addres them. It also helps us appreciate the importance of cooperation among nations.

While there are multiple challenges awaiting us ahead, these factors give us ground to be optimistic, though with cautious, about a brighter future for Asia and the world at large.

3. The role of Asia

The rapidly changing international landscape, while posing many challenges, is also offering important opportunities for Asian countries. With the right policies, Asian countries may well harness their strength, capitalize on the emerging trends, and participate in or even lead the process of shaping the new international cooperation frameworks.

Economically speaking, the region is presented with unprecedented opportunities. The global economic center of gravity is shifting to Asia, and this trend is expected to accelerate in the decades to come. Within a mere thirty years from 1988 to 2018, the contribution of Asia to global GDP has grown from 14% to 36%. By 2050 Asia will account for 55% of global output and two-thirds of global growth.

Technologically speaking, Asia, once a backward region, has  become a powerhouse in experimenting new technologies. 51% of businesses in this continent has invested into technologies to stay ahead for the 5G network. It is expected that by 2021 digital technology shall contribute an additional $1.160 trillion to regional GDP, and accelerate per-annum growth by another 0.8%. In Southeast Asia alone, the number of internet users is now 53% of the population.

In terms of economic linkages, Asia today is home to 2/3 of all FTAs in the world. In spite of the rising wave of trade protectionism in the world, the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) has been signed and come into force, the first new-generation FTA in the world. The negotiation for Regional Comprehensive Economic Partnership (RCEP) is going strong, and may well be signed by the end of this year.

The dynamism, innovation and growing connectivity of Asia is ground for us to be optimistic about the bright economic future of the region.

Given its enormous potential, beyond economic contributions, it is high time for Asia to present a stronger voice and play a stronger role in addressing global issues.

For their own interest and that of the world, Asian countries must lead the process of cooperation for a fairer and more equitable, cooperative, sustainable and effective world order. To this end, Asian countries need to:

- Strengthen the international economic integration and linkage process and regional connectivity initiatives; so as to maintain an international environment that facilitates growth, investment and trade.

- Uphold inclusive multilateralism and equal, mutually beneficial cooperation, based on international norms and laws, to foster the healthy connectivity among economies, achieve consensus on priorities and coordinate actions to together address common challenges.

- Encourage a new people-centered approach to achieve harmony. Harmony between mankind and society, ensuring inclusive growth. Harmony between mankind and nature, fostering economic growth alongside the sustainable management and use of natural resources. Harmony between mankind and technology, guaranteeing the interest of workers in the face of technological advancement. And, no less important, harmony among values, ensuring cultural diversity; and international integration while preserving and capitalizing on  national cultural characters.

As one of the most advanced economies in the world, Japan has made important contributions to Asia's development in the past decades. To ASEAN, Japan is an important partner that has actively lent your hand to the economic and social development of the entire Association and every individual member, and strongly support ASEAN’s unity and centrality.

Viet Nam welcomes Japan to continue playing an active role and making positive contributions to peace, stability and prosperity in the region and the world. We support Japan's initiatives with regards to quality infrastructure and regional connectivity, and hope that Japan will play a greater role in narrowing the infrastructure gap in Asia and the world.

We also hope that, as the G20 host for 2019, Japan will lead G20 to new advances in addressing global challenges, strengthening international support for the universal, open, transparent and rules-based multilateral trading system, and foster WTO reforms to ensure its effectiveness in the new context.

4. A new global order

As the inevitable development of history goes, we are now in transition towards a new global order. The creation of a new order, however, does not mean the eradication of the old, particularly as the fundamental elements of the rules-based order remain relevant.

History has shown that not every transformation of the world order would necessarily lead to war or chaos. The world can well avoid such disasters if changes are well-managed and major powers respect the basic rules for international conducts.

Viet Nam believes that a sustainable and effective world order must fulfill the following criteria:

(i) One, it must help strengthen inclusive multilateralism, foster trust and cooperation among states, and develop a global governance system that address the major challenges of the 21st century.

The major challenges to be addressed are: to promote economic growth and ensure everyone benefits from this process; to create a more resilient, reliable and accessible financial system; to remedy anti-globalization sentiments; to reform the global trade framework to keep pace with the rapidly evolving trading and investment models; and to muster sufficient resources to realize the 2030 Sustainable Development Goals.

(ii) Two, it must be built and operated on the basis of law, with the United Nations at its center.  All countries large and small must abide by international norms and laws. It must not allow countries to pursue a ‘might is right’ approach to their own policy priorities. The system must allow medium and small-sized countries to maintain their independent and self-reliant foreign policy, without being forced to choose between major powers.

Asian nations share the common aspiration for peace and prosperity. During the 20th century, this continent had been the stage for wars and bloodshed.

Yet Asia is also the birthplace of various principles and norms of conduct in international relations that remain relevant still. These are the five principles for peaceful coexistence and ASEAN's Treaty of Amity and Cooperation (TAC).

ASEAN and China is currently making efforts to accelerate negotiations of the Code of Conduct of Parties in the South China Sea (COC) which would be substantive and effective. It is in the interests of all countries within and beyond the region to maintain peace, stability, security and freedom of navigation and overflight on the basis of international law, including the 1982 United Nations Convention on the Law of the Sea (UNCLOS)

(iii) Three, it should live by the principle of equality and equity. This order must be open and balanced among differing ideologies, so as to serve the interest of the peoples and all nations. Rules and laws must be applied consistently and universally. .

5. Viet Nam's policies

Having lived through the ebbs and flows of history, the people and government of Viet Nam always treasure and safeguard peace and stability.  We attach great importance to upholding international law, preventing disputes and addressing them through peaceful means. We support the promotion of multilateralism and global partnership, and consistently aims to promote peace and stability for the common good and the prosperity of every individual country, region and the world at large.

With such a view, Viet Nam is steadfast in pursuing the foreign policy of independence, self-reliance, cooperation and development, diversification and multilateralization of external relations, proactive and active international integration. We are also stepping up economic reforms, improving the business environment, promoting the development of all economic stakeholders, and investing into education and human resources development.

International integration has truly become a key driver for growth and socio-economic development, thus strengthening the country’s power.

After 30 years of reform, Viet Nam has become an inseparable element of the region and the world. We are now one of the fastest-growing and most open economies in Southeast Asia.Our GDP growth was nearly 7.1% in 2018, among the fastest-growing economies in the world; total trade value was $485 billion, or 200% of GDP.

Our efforts to improve the business environment have brought about positive results. According to the World Bank, Viet Nam's Ease of Doing Business ranking in 2018 was 69th out of 190 countries. Our competitiveness ranking according to the World Economic Forum was 77th out of 140, while our innovation ranking was 45th out of 127 according to the World Intellectual Property Organization. These figures are testament to the businesses and investors' confidence and support for our government's reform efforts in recent years.

Viet Nam is also the only ASEAN country that has established  strategic partnerships and comprehensive partnerships with every G7 country and 16 out of 20 G20 countries. These are all major trade and investment partners of ours. G7 alone accounts for 27% of all FDI inflow into Viet Nam and 50% of her total trade value in 2017 – which is growing at 10 to 12% per annum on average.

Viet Nam is also among the top countries in ASEAN with regards to the number of FTAs in effect or under negotiation.

6. Viet Nam – Japan relations

I am pleased to note the robust, substantive and comprehensive growth in all areas of the Extensive Strategic Partnership between Viet Nam and Japan. Our two countries enjoy a high level of political trust; our high-level leaders have visited and met with each other regularly. Viet Nam considers Japan a reliable, long-term and leading partner.

Japan continues to be our most important economic partner: the largest ODA provider, the second largest FDI investor, third largest tourism partner, and fourth largest trade partner.

In addition, cooperation in labor, education, tourism, climate change response and agriculture are all growing rapidly, having recorded remarkable achievements. The Vietnamese community in Japan, the majority of whom are students and trainees, is building a friendship bridge between us, fostering sustainable and long-term ties between the two countries in the future.

I have full confidence that cooperation between our two countries shall continue to broaden and deepen, bringing about real benefits to our peoples and contribute to the shared prosperity in the region.

Viet Nam's economic growth prospects are opening up many new opportunities for cooperation to Japanese firms. With a sustained growth rate of 6% over the past 20 years, Viet Nam is becoming an important consumer market for the region, and a promising market for Japanese goods and services.

To ensure the interest for FDI firms in Viet Nam, we pledge to ensure law and order, maintain political, macroeconomic and policy stability.

Our government is continuing the effort to improve the legal and policy framework concerning foreign businesses, making them more consistent, open, clear and transparent. We will also improve law enforcement, address bottlenecks for investors, and strengthen dialogue with businesses.

We shall continue to engage in policy dialogue programs with Japanese businesses, such as the Viet Nam – Japan Joint Initiative, the Keidanren policy dialogue or Japan Desk. We pledge to guarantee the interest of Japanese investors doing business lawfully in Viet Nam.

We encourage Japanese businesses to invest further into high-tech industries, smart agribusiness, logistics and supporting industries.

7. Conclusion

Ladies and gentlemen,

A peaceful, prosperous and sustainable world is the aspiration of all states and nations. The future of our world shall be shaped by the policy decisions today.

It is my hope that countries large and small shall continue to step up cooperation and dialogue to seek solutions to our shared challenges, and promote trust to establish a strong foundation for our future.

I have full confidence that given its enormous potential, Asia will contribute ever more effectively to the development of the world.

Finally, I wish the conference a great success, and wish you all good health and happiness. Thank you for your attention!

「ありがとうございます」/ Arigatou Gozaimasu./.