Australia and Vietnam: A Dynamic and Growing Partnership

Over the years, Australia and Vietnam have built a strong and multifaceted relationship founded on mutual respect, shared interests, and strategic cooperation. On March 7, 2024, this partnership achieved a significant milestone with its elevation to a Comprehensive Strategic Partnership, symbolizing the depth and breadth of collaboration between the two nations.

A History of Collaboration

Since establishing diplomatic ties in 1973, Vietnam and Australia have cultivated a robust partnership built on trust and mutual understanding. During the early stages of the COVID-19 pandemic, Australia demonstrated its commitment by becoming Vietnam’s second-largest foreign donor, supplying 26.4 million vaccine doses. In addition, Australia has provided significant Official Development Assistance (ODA) to Vietnam, supporting areas such as human resource development, infrastructure, healthcare, and UN peacekeeping efforts.

On a societal level, Vietnamese Australians form the sixth-largest migrant community in Australia. Meanwhile, nearly 17,000 Vietnamese students are enrolled in Australian institutions, creating enduring connections between the two countries. Many Vietnamese alumni return to contribute to Vietnam’s growth, further strengthening people-to-people ties.

Thriving Trade and Economic Cooperation

The economic partnership between Australia and Vietnam is experiencing remarkable growth. Bilateral trade reached $25.7 billion in the 2022/23 financial year, a 75% increase from 2020. With Vietnam’s dynamic economy, characterized by an 8% GDP growth rate in 2022 and over 5% growth in early 2024, opportunities abound for Australian exporters in sectors such as energy, agriculture, and professional services.

The Enhanced Economic Engagement Strategy (EEES), launched in November 2021, outlines a roadmap to elevate bilateral trade and investment, aiming to make both countries top ten trading partners while doubling two-way investment.

Vietnam has become a key market for Australian exports, particularly in cotton, coal, and beef. For instance, Vietnam is Australia’s largest cotton export market, accounting for 40% of its exports. Australian beef and live cattle exports to Vietnam reached $170 million and $206 million, respectively. On the other hand, Vietnamese exports to Australia, such as coffee, machinery, electronics, textiles, and crude oil, have also seen significant growth.

Education and Innovation

Australia remains a top choice for Vietnamese students, with over 38,000 enrolled in 2023. Collaborative initiatives like the New Colombo Plan scholarships and the Vietnam-Australia Centre foster knowledge exchange and strengthen institutional links. These programs support Vietnam’s development priorities in areas like digital transformation and vocational training, leveraging Australian expertise to build capacity and drive innovation.

Investment Landscape

Vietnam’s Foreign Direct Investment (FDI) environment continues to expand, offering opportunities in technology, renewable energy, healthcare, real estate, and more. Australian businesses are actively investing, with 631 projects valued at over $2 billion as of February 2024. Investments span diverse sectors, including manufacturing, agriculture, education, and entertainment, with provinces such as Ba Ria - Vung Tau and Ho Chi Minh City emerging as top destinations.

A Vision for the Future

As both countries navigate global challenges, their Comprehensive Strategic Partnership underscores a shared commitment to sustainable development, regional cooperation, and innovation. Annual dialogues on key areas like mineral resources will further deepen collaboration.

With a strong foundation and a shared vision, Australia and Vietnam are well-positioned to harness their strengths, address challenges, and contribute to a stable and prosperous Indo-Pacific region. Their partnership exemplifies the power of cooperation in achieving mutual growth and long-term benefits for both nations.