(L-R) Vietnam's Prime Minister Phạm Minh Chính and Luxembourg's Prime Minister Xavier Bettel during the former's visit to Luxembourg in December 2022; Credit: © SIP/Emmanuel Claude

This week, Luxembourg's Prime Minister, Xavier Bettel, and the Minister for Small and Medium-Sized Enterprises and the Minister for Tourism, Lex Delles, are travelling to Vietnam.

Luxembourg and the Socialist Republic of Vietnam are celebrating the 50th anniversary of diplomatic relations between the two countries (1973 to 2023). The Prime Minister is on an official visit to Vietnam and is visiting both Hanoi and Ho Chi Minh City, accompanied by Minister Delles, a seventeen-strong official delegation and a small press contingent (including Chronicle.lu); meanwhile, the Luxembourg Chamber of Commerce - in collaboration with the Belgian-Luxembourg Chamber of Commerce in Vietnam, Luxembourg's Embassy in Vietnam and Luxembourg's Ministry of State - is organising a trade mission to Ho Chi Minh City and Binh Duong, in parallel, focussing on the Digital Economy, Logistics, Energy/Environment and Smart Construction.

Some examples of Luxembourgish companies currently active in Vietnam include Cargolux, B Medical Systems, ArcelorMittal and Paul Wurth. Other companies also participating in the 27-strong trade delegation include Andersen Tax, 2 Point 0, Amelia & Associés, Bela, Chateau d'Urspelt, Cluster for Logistics Luxembourg, DLP Law Firm, Euro-Asie International Travel Agency, Europe Fiduciaire (Luxembourg), ie.lex, IEE, Impactify, LuxProvide, Multigone, PM International, POST Luxembourg, Rotarex, Socom, Tenzing Partners and Victor Buck Services.

Vietnam, with its young population of around 100 million people, has the fastest-growing middle class in the ASEAN region.

Development Cooperation

Luxembourg and Vietnam have also maintained development cooperation relations since 1993 and, in 1995, Vietnam became a partner country of Luxembourg Cooperation. In 2011, Vietnam became a middle-income country and Traditional Development Cooperation, based on the Indicative Cooperation Programmes (ICP), came to an end in 2015. Since the beginning of this relationship, Luxembourg financed more than 80 development projects in Vietnam for a total budget of more than €129 million.

Since 2016, the bilateral partnership between Luxembourg and Vietnam has continued at other levels, particularly in the areas of research, renewable energies, the fight against climate change, education and finance.

In November 2017, Romain Schneider made a working visit to Vietnam and Laos in his capacity of Luxembourg's Minister for Development Cooperation and Humanitarian Affairs, to focus on changes to financial aid in the two countries. The new General Cooperation Agreement signed in 2017 provided for the establishment of a diversified bilateral partnership encompassing research, renewable energy, climate change and finance sectors, with future projects being implemented in cooperation with various Luxembourg ministries.

Aid from Luxembourg peaked in 2015 with a total grant of €10.21 million awarded to Vietnam, but dropped to €6.08 million in 2017 and continued to drop to €4.62 and €2.48 million in 2018 and 2019 respectively. In light of Vietnam’s development progress, Luxembourg’s grant based official development assistance (ODA) phased out and the two countries are striving to diversify their partnership.

Trade / Economic Cooperation

In December 2022, the Vietnamese Prime Minister Phạm Minh Chính made an official two-day visit to Luxembourg, accompanied by five Vietnamese government ministers and a sizeable business delegation, with the Luxembourg Chamber of Commerce hosting a Vietnam-Luxembourg Business Forum, organised jointly with the Embassy of Vietnam in Brussels. Almost 30 Vietnamese companies were represented, whilst representatives of nearly 50 Luxembourgish companies were also present at the forum. Carlo Thelen, Director General of the Luxembourg Chamber of Commerce, referenced that Vietnam is currently Luxembourg's ninth biggest trade partner outside the European Union (EU); Luxembourg is also the third largest EU investor in Vietnam. Lex Delles, Luxembourg's Minister for Small and Medium-Sized Enterprises (SMEs) and Minister for Tourism, and Vietnam's Prime Minister Phạm Minh Chính, also addressed the event. His Royal Highness the Grand Duke of Luxembourg had received the Vietnamese Prime Minister in audience at the Grand Ducal Palace.

During that visit, a memorandum of understanding (MoU) was signed that same evening between the École d'Hôtellerie et de Tourisme du Luxembourg (EHTL) and Hong Quang Business Consulting Company Limited (HQBC), to facilitate the implementation of a cooperation project aimed at promoting vocational training in provinces and cities in Vietnam in the hospitality and tourism sectors. Another MoU between the two countries was signed between the Luxembourg Chamber of Commerce and Vietrade, another between Luxaviation and Thien Minh Group (especially with its subsidiary Hai Au Aviation (HAA), the largest business jet operator in Vietnam), also between EHTL and HQBC and between EVN and Babcock & Wilcox. In addition, Vietnam Electricity and the European Investment Bank (EIB) signed an MoU to to enable the direct financing of power investment projects in Vietnam and strengthen partnerships in the fields of electricity generation, storage, transmission, distribution and sales, and also covering the energy transition towards decarbonisation. A last MoU was signed between the Luxembourg Stock Exchange (LuxSE) and the Vietnam Stock Exchange (VNX).