10 questions to J-P Muller, new AWEX Trade Counsellor in Vietnam27/11/2022
After 30 years of service for the Wallonia Export & Investment Agency (AWEX) in countries as diverse as Pakistan, China, the United States, India and most recently South Africa, Jean-Pierre Muller has just taken up office in Ho Chi Minh City for what will be his last assignment before retirement. We met with him three months after his arrival to get his first impressions and to discuss his expectations, his ambitions and his projects.
What is your spirit at the dawn of your final assignment? How do you feel about taking on your new role in Vietnam ?
The predominant feeling is joy, of course. I am very happy with this assignment. A return to Asia for my last posting, I couldn't have hoped for better! Beside joy, I also feel excitement about this new challenge, and curiosity at the idea of discovering this fascinating country that awakens our imagination and our thirst for exoticism. But there is also a sense of responsibility in me. I am well aware that my country, and my region, are going through a very difficult period at the moment, and that our role at the AWEX, by stimulating exports, attracting foreign investment and working towards reshoring and restructuring supply chains, can contribute to make a difference.
What has made the biggest impression on you since you took up your post in Ho Chi Minh City?
First of all, the optimism of the people! You can see that they have confidence in themselves, that they have faith in the future. You can see it in their faces, in their eyes and in all those smiles that are not just for show. I have a similar feeling here as when I arrived in Shanghai in 1994. People knew that the future was theirs. This ambient optimism gives off an atmosphere that literally transcends you. You feel carried along!!
And secondly, I would say the youth of the population. It strikes me every morning in the crowded lift of my office building, or in the stream of thousands of scooters in the morning traffic. And this, on the other hand, is really very different from China. In 1994, the one-child policy was strictly applied in China, resulting in a generation of “little emperors” and a worrisome demographic curve. Here, on the contrary, more than half of the working population is under 35! And when a real GDP growth is accompanied by a demographic growth similar to this one, then one can really talk about a "Youth dividend"!
Talking about growth, what are according to you Vietnam's major economic assets?
Vietnam navigated the covid crisis relatively well. In 2020, the country went into strict isolation from the outside world for almost a year; sectors like tourism suffered greatly. But it paid off. Today, while the Western world is facing an economic tsunami following Putin's brutal invasion of Ukraine, Vietnam is little affected because it is almost self-sufficient in energy. In 2021, and despite a very strict lock down from August to October, Vietnam has managed to maintain 2.5% real GDP growth. And for the year 2022, we expect 7.5% growth with an inflation rate limited to 3%. How about that? Vietnam is truly the growth champion in the ASEAN zone, which is itself the only major economic region in the world with a high growth rate. In the region, Vietnam is clearly taking advantage from the zero-covid policy in China and the sharp slowdown there. Many companies are reviewing their supply chains, and Vietnam is emerging as a good risk for global manufacturing because of its good-quality labour and relatively low cost. There will be some significant transfer of investment from China to Vietnam in the years to come. Another important asset of Vietnam is its political stability, as well as its well-structured legal framework. Unfortunately, this legal framework goes hand in hand with a very heavy bureaucracy. And this is a big drawback for the country.
Speaking of legal frameworks, what about the new free trade agreement between Vietnam and the 27 EU member states, which came into force in August 2020 ?
Upon entry into force, 65% of EU exports to Vietnam and 71% of Vietnamese exports to the EU were immediately liberalised under the EU-Vietnam Free Trade Agreement (EVFTA). The remaining duties will be progressively reduced over the next 10 years. The agreement will clearly boost bilateral trade. Vietnamese companies are in the starting blocks. Delegations in Brussels and other European capitals are following one another at a frenetic pace. On our side, the companies that already export to Vietnam will be the first to benefit from this agreement. Our challenge at the AWEX will be to use this free trade agreement as an argument to convince those who do not yet export to Vietnam to take an interest in this market. So we have some work to do in terms of communication!
What will be your goals for the AWEX?
I will aim for a breakthrough in some important contracts that have been under negotiation or stalled for many, many years, for example in the water treatment sector, large medical equipment, and so on. We need to give the necessary impetus to win these contracts. I also want to help new companies to get a foothold in this market, whether it be through pure export or by establishing a local base. I will also try to play my part in training our young people by offering them as many internship opportunities as possible in Vietnam.
What are the priority sectors for Wallonia in Vietnam?
The dominant sector for our exports is the health sector. Pharmaceutical products and vaccines alone account for 75% of our exports. But the health sector also includes medical devices, diagnostic kits, nutraceuticals, digital health care, etc. The food and drink sector is also a priority. AWEX took part in the "Food ingredients Vietnam" fair in mid-October with a stand on which 12 companies from Wallonia were represented! And next month, we will have a pavilion at the "Food & Hotel Vietnam" exhibition with about 10 companies. More broadly, the agricultural sector offers very good prospects. In 2018, Belgium and Vietnam signed a strategic agreement to promote the agricultural sector. This should give us an advantage over our competitors in delivering the technology that Vietnam urgently needs (for example for processing and packaging, cold chain management, etc.). I would also like to mention the IT sector: the digital transition is in full swing in Vietnam. And the country now appears to be one of the world's main reservoirs of talent for coding and IT development. In fifth place, I would mention sustainable development. At the Cop 26 in Glasgow, Vietnam made a very strong commitment to "net zero emission" by 2050. "Net Zero Emission" is not only about energy, but also about how the country will develop agriculture, waste treatment, smart cities, conversion of means of transport, etc. This will lead to profound changes in the way the country operates and therefore to great opportunities. And then there is everything else: as you know, the economy of Wallonia is very diversified in terms of exportable products and services. We must be prepared to respond to any request for assistance.
What about the culture, the arts and education sectors?
This is first and foremost the core activity of our sister organisation Wallonie Bruxelles International (WBI). They have a very well-established delegation in Hanoi. I was able to measure its efficiency during the official visit of Minister-President Pierre-Yves Jeholet, last month, at the invitation of the Vietnamese Minister of Foreign Affairs, to celebrate 25 years of bilateral collaboration. The Minister-President was received at the highest level by no less than 6 Vietnamese ministers, including the Prime Minister and the Minister of Foreign Affairs. I was very impressed by the quality of WBI's partners and the warm welcome the Minister-President received from the Vietnamese. I am convinced that these privileged partners of WBI may be very useful in my work. There are great synergies to be maintained between the AWEX and WBI and even developed.
In terms of investment attraction, is Vietnam a potential target for Wallonia?
Yes, because we are starting to see large Vietnamese groups investing abroad. For example, one of the main diversified groups, VINGROUP, is in a phase of international expansion. Its subsidiary "Vinfast" (electric cars) has just established a European base (in Germany) and opened about 50 dealerships in Western Europe (not yet in Belgium) to promote its VF8 and VF9 electric car models. And this follows a major investment by the group in the US in 2021 of about 2 billion USD. So yes, there is hope! And one of the projects I have in mind will be to use Wallonia's advantageous logistical position in Europe to promote a warehousing and distribution centre for Vietnamese products in the agri-food sector. As mentioned above, we have a bilateral agreement in place between the two countries to promote our partnerships. Today, Vietnamese agri-food exporters present themselves on the European market in a scattered manner. They need a European logistical showcase to present themselves in a structured and professional manner, with the proper networks and the knowledge and skills needed to penetrate the EU market while complying with European regulations on sanitary and phytosanitary certificates. This would be a great project, generating jobs for us and added value for them. I have four years to achieve this!
What will be the major “rendez-vous” in 2023?
Next year, Belgium will celebrate 50 years of diplomatic relations with Vietnam. There will be highlights for this jubilee, both in Belgium and in Vietnam. It will be a great opportunity to intensify our already very good bilateral relations. There will also be an AWEX economic mission to Vietnam in September 2023. But I think there will be many more events and delegations added to this agenda.