Despite the challenges facing Vietnam's banking sector, Singapore has much to offer and gain from maintaining close economic ties with the socialist republic.
Given Singapore's robust regulatory frameworks and financial services expertise, the city-state is well positioned to share its banking expertise with Vietnam - and can ultimately play a part in strengthening the country's long-term economic future, Minister in the Prime Minister's Office, Grace Fu, said yesterday in Hanoi.
Ms Fu is accompanying Prime Minister Lee Hsien Loong on a three-day official visit to Vietnam.
Speaking to the Singapore media yesterday, Ms Fu - who is also Second Minister for the Environment and Water Resources, and Foreign Affairs - said Vietnam's leaders had requested Singapore's help in reviewing and improving financial governance structures.
"Both the party secretary and prime minister (know) that to bring the economy forward, the banking system is a very important lubricant in moving capital around . . . (They) talked about how they would like to seek our help in having a more robust regulatory framework (since) they recognise that as our strength," she said, noting that Singapore was happy to share its experiences to help Vietnam "build a stronger banking system".
Vietnam's economy has been hobbled by inflation, a volatile exchange rate and inefficient state-owned enterprises. The banking sector, in particular, has been weighed down by weak banks and their high levels of non-performing loans.
Such challenges aside, Ms Fu said there were still plenty of opportunities for Singapore investments in Vietnam - not just in financial services, but in areas such as manufacturing and tourism hospitality.
Urging Singapore companies to "pay attention" to Vietnam, Ms Fu said: "These are all great opportunities (and) especially with the possibility of Vietnam being part of the TPP (Trans-Pacific Partnership), I think it opens up market accessibility that (has) never been (there) before."
When asked for an update on the goal for an integrated Asean Community by 2015, Ms Fu said that 80 per cent of targets have been met, and that there are "good prospects" of the 2015 goal being fulfilled.
Apart from his call on President Truong Tan Sang yesterday, PM Lee also met National Assembly President Nguyen Sinh Hung. Mr Lee expressed Singapore's intent to enhance exchanges between Vietnam and Singapore at all levels, including between both countries' parliamentarians.
Later in the afternoon, Mr Lee and his wife Ho Ching were treated to a joint military band performance by the Vietnam People's Army and the Singapore Armed Forces (SAF) Central Band. The collaboration marked the first-ever bilateral joint band performance for the latter ensemble.
PM Lee concludes his official visit to Vietnam today with a trip to the central province of Quang Ngai, where he will co-officiate the ground-breaking ceremony of the fifth Vietnam Singapore Industrial Park and meet provincial authorities.