Australia to provide $69.4 mln for Vietnam’s infrastructure development, energy transition

Australia will offer Vietnam an aid package of AU$105 million ($69.4 million) to help the country with infrastructure development, climate change response and energy transition, Australian Prime Minister Anthony Albanese said on Sunday.

Co-chairing the Vietnam-Australia press conference with his Vietnamese counterpart Pham Minh Chinh following their talks in Hanoi, Albanese said the money will be used to help Vietnam make sustainable infrastructure planning and develop clean energies and its mining industry.

He noted that Australia was among the first countries to set up diplomatic ties with Vietnam right after the Agreement on Ending the War and Restoring Peace in Vietnam (Paris Accords) was signed in 1973. "Since then, the two countries’ relations have been developing strongly, especially in economy, education, agriculture, security, trade and investment."

Vietnam has become a manufacturing hub with leading production capacity, Albanese said, adding that Australia has helped Vietnam reach out to the world with financial and infrastructure support, including the construction of two bridges in the Mekong Delta - a symbol of the friendship between the two peoples.

Earlier, the two PMs witnessed the signing of a memorandum of understanding between the State Bank of Vietnam and the Australian Transaction Reports and Analysis Centre (AUSTRAC) on exchanging information on money laundering and terrorism financing.

Albanese also announced the opening of the Hanoi Industry and Innovation Hub of RMIT, one of Australia's largest tertiary institutions.

This is the first outcome of a new strategic investment fund worth AU$250 million ($165 million) which will see RMIT invest in education, research, partnerships and campus infrastructure, as Vietnam’s leading international university, contributing to the country’s social and economic goals, he said.

Established in 2000, RMIT Vietnam is the first international university in the country and currently has over 12,000 students, 1,000 staff and 20,000 alumni.

The Australian leader also revealed that his country will provide 60 scholarships from Western Sydney University to Vietnamese students.

The Australian PM began his two-day official visit to Vietnam on Saturday morning. This is the first official visit to the Southeast Asian nation by Albanese since he took office in May 2022. It also marks the 50th anniversary of the Australia-Vietnam diplomatic relations.

Vietnam and Australia established their diplomatic ties in 1973, which were elevated to a strategic partnership in March 2018.

Australia was Vietnam’s seventh-largest trade partner in 2022, with two-way trade hitting $15.7 billion, a year-on-year increase of 26.7%. The Southeast Asian country’s export turnover to Australia reached $5.6 billion, while its import spending for Australian goods and services reached $10.1 billion, up 26.2% and 27.3% against 2021, respectively, according to the Vietnam Customs.

Vietnam’s shipments to Australia include machinery, equipment, footwear, textiles, seafood, iron and steel. Meanwhile, Australia is a significant supplier of raw materials for the Southeast Asian country, including coal, cotton, ores, minerals, and wheat.

Vietnam and Australia should work more closely in new areas such as innovation, renewable energy, circular economy and high-tech agriculture, culture, and tourism, Vietnamese Minister of Planning and Investment Nguyen Chi Dung said at the third ministerial-level Vietnam-Australia Economic Partnership Meeting held in Hanoi last month.

Australia is the 20th-biggest foreign investor in Vietnam with 599 valid projects and a total registered capital of $1.99 billion to date, according to Vietnam's Ministry of Planning and Investment. The top ones are South Korea with valid 9,666 projects worth $81.56 billion, Singapore with 3,240 projects worth $73.38 billion, and Japan with 5,091 projects worth $69.63 billion.

Vietnam has invested more than $592 million in 88 projects in Australia, ranking 10th among 79 countries and territories investing in this country. The Vietnamese projects are mainly in the fields of agriculture, forestry, wholesale and retail, and processing-manufacturing.

Australia is one of the largest official development assistance (ODA) providers for Vietnam, with a total of AU$3 billion ($1.98 billion) in the past five decades.