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TRUONG TAN SANG’S VISIT TO JAPAN: DEEPENING BILATERAL TIES – ANALYSIS
March 17, 2014
Rajaram Panda
The forthcoming four-day visit of President of Vietnam Truong Tan Sang to Japan beginning 16 March 2014 is the latest development in Vietnam’s foreign policy activism with a view to deepen diplomatic relations. Sang will be accompanied by his spouse Madam Mai Thi Hanh. The visit is at the invitation of the Emperor of Japan.

Coming in the wake of China’s increased maritime assertiveness and its territorial disputes in the East and South China Sea, Sang’s visit assumes added significance. Security issues in Asia, China’s assertiveness on regional issues as well as nuclear and missile development by North Korea are likely to be high on the agenda of the summit meeting with Prime Minister Shinzo Abe.

Sang and Abe are expected to agree on enhanced bilateral cooperation in areas such as agriculture, education and healthcare. Both the leaders are also expected to sign deals for yen loans from Japan to finance development projects in Vietnam. North Korea’s past abduction of Japanese citizens has prevented Tokyo and Pyongyang from normalising relations. During the election campaign, Abe had promised the families of the abductees that his government would spare no effort to get those nationals abducted by North Korea released. Since Vietnam has diplomatic ties with North Korea, Abe is expected to seek Vietnam’s help on this.

During their stay in Japan, Sang and Hanh will make a State Call on Their Majesties the Emperor and Empress of Japan. Their Majesties the Emperor Akihito and Empress Michiko will host a State Banquet in honour of the President and his souse. Abe will host a dinner for the President. A press release by the Ministry of Foreign Affairs said that the President’s visit “will further strengthen the friendly relations between Japan and the Socialist Republic of Viet Nam”.

Both Abe and Sang last met in October in Indonesia on the sidelines of an international conference. During that time, both the leaders agreed to promote maritime security cooperation and to encourage Japanese companies to invest more in Vietnam. Sang will also deliver a speech at the Diet on 18 March and the following day will meet with Japanese business leaders before departing on 19 March.

Economic Ties
Vietnam and Japan established diplomatic relations on 21 September 1973. Since then, bilateral ties have undergone some historical ups and downs until Japan resumed its ODA provisions to Vietnam in 1992. Japan is Vietnam’s biggest development assistance donor and investor. From 1992 to 2003, Japan has provided $21 billion ODA to Vietnam, making the country’s leading ODA donor.

Vietnam-Japan bilateral trade turnover reached over $25.6 billion in 2013 and the figure is expected to double by 2020. During the year, Japan invested $5.7 billion in Vietnam, accounting for 26.6 per cent of foreign direct investment (FDI) in Vietnam.

Until 2002, economic cooperation remained the brightest spot in the bilateral ties. Subsequently, bilateral relations have assumed multilateral dimension as mutual understanding and trust have been consolidated. Bilateral ties were elevated into a strategic partnership in 2009. In 2011, Japan was the first G-7 country to recognise Vietnam as a market economy. Currently, the two countries are working together in negotiations on the US-led Trans-Pacific Partnership (TPP) agreement.

During Vietnam Foreign Minister Pham Binh Minh’s visit to Japan in September 2013, Japan’s Foreign Minister Fumio Kishida pledged roughly 54 billion Yen in loans to Vietnam for infrastructure projects. The loan offer was aimed at a highway project and an airport terminal project, both in Hanoi, and a hydroelectric power project in southern Vietnam.

Why Japan and Vietnam?
Japan and Vietnam might sound two different worlds. The world’s third largest economy and Northeast Asia’s newly emerging economy differ on many fronts – broadly in their systems of government. How can they come together, one might ask? The ready answer could be that their pass may never cross. But this geo-economic logic has been disproved by history. Why is this so? This is because if one goes by the theory that relations between the two countries have been greatly influenced by outside powers, one notices a striking example how Japan-Vietnam relations have evolved in recent times. Though the economies of the two countries are deepening in recent years, it is the strategic dimension of the relationship that provides solidity in their bilateral ties.

In the late nineteenth century, confronted by Western colonialism, Vietnamese’s nationalists took refuge in Japan and sought inspiration from Japan’s economic development and resistance to the West. Following the occupation of Vietnam by the imperial army during the Pacific War and the utilization of the Okinawa base by the American B-52′s bombers during the Vietnam war, Tokyo has been perceived as an enemy. Today the story is different. Rapprochement between the two countries and a convergence of their interests make the Japan-Vietnam partnerships an ideal model for bilateral relationship in Asia and marks a significant landmark in the emergence of a new Asia. And, what is that driving this new orientation in the Japan-Vietnam relationship? As China threatens Asia by its aggressive postures, a new balance of power in Asia is emerging and leading to reorienting relationships between adversaries. The evolving contours of Japan-Vietnam ties should be seen from this perspective.

Defence cooperation
The single most important factor that seems to be drawing both Japan and Vietnam closer seems to be their territorial disputes with China in the East and South China Seas. The China factor is also leading both the countries to strengthen the ongoing bilateral dialogue between defence and foreign affairs officials. Japan is determined to deal with the Senkaku Islands dispute “calmly and resolutely but without escalating” tensions and Vietnam endorses Japan’s views that the dispute should be resolved in line with international law. Similarly, Vietnam’s position on its territorial dispute in the South China Sea remains unchanged. Japan endorses Vietnam’s approach as a member of the Association of Southeast Asian Nations that the dispute should be addressed by working out a regional code of maritime conduct.

In fact, the defence cooperation between the two countries is not sudden. On 24 October 2011, Japanese Defence Minister of Japan Yasuo Ichikawa and his Vietnamese counterpart Phung Quang Thanh signed a memorandum on defence cooperation and exchange in Tokyo. This agreement to cooperate was in the light of China’s increasing influence in the South China Sea, where Hanoi is locked in a territorial dispute with Beijing.

Under the memorandum on defense cooperation and exchange, vice defense minister-level officials from Japan and Vietnam will hold regular dialogue. The Self-Defense Forces and the Vietnamese military will visit each other’s country. The document also said the two countries will cooperate in rescue efforts in the event of a disaster in Southeast Asia or elsewhere. The defense cooperation memorandum is Japan’s second with a Southeast Asian country following the one with Singapore, concluded in December 2009.

Thanh’s visit to Japan was the first for a Vietnamese defence minister in 13 years. At that time, Ichikawa had observed: “The relationship between Japan and Vietnam has entered a new stage of development”. He further observed: “Vietnam is our strategic partner for peace and stability in Asia, and we want to deepen our partnership.” From his side, Phanh had observed: “The relationship between the two countries is extremely important”.

From Vietnam’s perspective, its plan to reinforce its relationship with Japan is to counter China’s growing military might in the South China Sea and Japan supports a peaceful resolution. At that time, Japan’s Foreign Minister Koichiro Genba too had remarked that the seas are public goods and that a broad range of issues should be discussed in an open forum.

Beijing’s assertive claims to maritime boundaries in the South China Sea have rattled America’s regional partners. This too has led Washington to deepen its security cooperation with Vietnam, the Philippines and other states whose territorial claims China disputes.

It is interesting to note here that China even sees Russia as rivals than allies on this issue. To Beijing’s dismay, Moscow has remained silent on the territorial disputes. Even Russian energy companies have signed deals with Vietnam to develop oil and gas resources in the South China Sea – in waters claimed by China. Beijing also feels uncomfortable as Russia’s defense industry is expanding its weapons sales throughout Southeast Asia, including selling advanced attack submarines to the Vietnamese Navy. By its own aggressive posturing, Beijing is getting isolated in Asia without friends, except probably North Korea and to some extent Pakistan.

Dr. Rajaram Panda is The Japan Foundation Fellow at Reitaku University, Japan.
 
Good news,its time for VN to become developed nation.
 
Another article analyzing the context of this visit:
Vietnam, Japan deepen strategic partnership
By Robert Tofani
Vietnamese president Truong Tan Sang has paid a three-day state visit to Japan from March 16-19 at the invitation of Emperor Akihito. The visit, that follows a meeting between the two Ministries of Finance held in Tokyo at the beginning of the month, “highlights a significant political event that will bolster bilateral political trust and strategic partnership in the light of regional and global rapid changes,” as underlined by the Vietnam News Agency.
Vietnam officially established diplomatic relations with Japan on September 21, 1973. The bilateral ties have rapidly developed in various fields and have been growing unceasingly from a reliable partnership in 2002 to a strategic partnership in 2009. Currently, Japan is the largest official development assistance (ODA) donor for Vietnam, accounting for about 30 percent of total ODA commitment that the international community pledges for the Southeast Asian nation each year. Since 1993, Japan has committed more than 21 billion USD in ODA, contributing to the country’s socio-economic development. According to Japanese data, its commitment for the current year will not be less than the 1.94 billion USD it provided last year. The announcement was made in Hanoi on March 6 by Mutsuya Mori, the chief representative of the Japan International Cooperation Agency in Vietnam. Among the recent projects funded via ODA are a beltway around Hanoi, a terminal at Noi Bai international airport, and renovation of the Da Nhim hydropower plant built in the 1960s with Japanese funding in south-central Vietnam. According to the Vietnamese press, “the three projects received around 534.5 million USD.”
Japan is thus one of Vietnam’s most important economic partners, with the two-way trade estimated at 25.6 billion USD in 2013. Japan was the first G7 country to recognize the market economy status of Vietnam in October 2011, two years after which the Japan-Vietnam Economic Partnership Agreement (JVEPA) entered into force, thus marking a new milestone in two-way economic relations.
Signed on 25 December 2008 the JVEPA is a comprehensive bilateral agreement that should boost trade liberalization of goods and services, economic cooperation and investment between the two countries. It has been also agreed to advance the Vietnamese Supporting Industries (SI) for Japanese and Vietnamese enterprises. Besides, according to Japan External Trade Organization (JETRO) SI development is one of the themes under the framework of the “Vietnam- Japan Joint Initiative”, which was launched to improve business climate in Vietnam upon the agreement by the two Prime Ministers. JETRO recently released the results of a survey on business operations in 2013. Accordingly, up to 70 percent of Japanese firms investing in Vietnam have plans to expand business and continue to consider Vietnam an important outpost.
“There are about 2,000 Japanese businesses investing in Vietnam, including representative offices. It can be said that the investment as well as business activities of these businesses have gone into its development trajectory. Therefore, these companies are looking to expand their operations in Vietnam. This was clearly shown in 2013 when the number of expanded projects dramatically increased,” Atsusuke Kawada, Chief Representative of JETRO in Hanoi, said at a press briefing during this week. However, according to the survey, investing in Vietnam still bears risks, namely sky-rocketing labour cost, administrative procedures, unclear policies, complicated tax regime, customs procedures and legal system. In particular, “over 60 percent of the businesses said that the laws and policies, administrative procedures, tax regimes, customs procedures, increasing labour costs are big problems.” Overall, about 90 percent of businesses are optimistic saying that the main reason to expand business is an “increase in sales”. And in fact, Japan is the number one investor in Vietnam. As of August 20, 2013, Japan invested 33.06 billion USD in 2,029 projects in Vietnam, ranking first among foreign investors in Vietnam by investment value and ranking third in projects. Japanese investors also disbursed 10.8 billion USD of registered capital, ranking second in this category. Adding to this, Vietnam and Japan are both negotiating the Trans-Pacific Partnership Agreement (TPP), promoted by the United States. An economic relationship that excludes China.
Apart from the economic front, some observers view the desire to deepen the strategic partnership between the two East Asian countries as a move to counterbalance the People’s Republic of China, although neither Hanoi nor Tokyo officially affirms this. It is not known if the two representatives will discuss the geopolitical situation in the South China Sea and in the East Sea, where both nations claim sovereignty on islands disputed with China. The speech that President Sang will deliver at the Japanese Lower House, where only a few of foreign heads of state have a chance to speak, will say more also on this front.
 
If everything went well, include me to the list as a foreign investor. I'm going to modify part of Vietnam in terms of manufacturing.
Yeah, there will be more Japan special economic zone in VN. VN stock index is raising, its good time to invest in stock, Im investing in VN Index and earn well now :partay:

ITA, STB r the good choice for me .
 
The relation is not new, the recent movement just strengthen it more ...
Actually, Japan lined with the development of South Vietnam during Vietnam war until 1973. The first hydro powerplant created with Japan contractor in 1962.

From 1973 with the withdrawal of USA, Japan tried to reconnect to North Vietnam by paying for penalty of WW2, in order to get the normalized diplomat relation with reunited Vietnam.

They come very early and some big groups get big victory in Vietnam early, like Honda who situated their manufacturing center for motobikers in Vietnam. ...

Japan did invest several Industry Park for Japanese companies in Vietnam.
 
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