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Growth in Vietnam also benefits Danes

After two decades of development cooperation with Vietnam, the country is experiencing strong growth and becoming increasingly able to address its own development challenges. The experience from Vietnam shows how development cooperation can help lift a country out of deep poverty partly based on support for developing better framework conditions for growth and employment – which incidentally also benefits Denmark.

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Vietnamese women sorting fish for production of fish flour in Ben Tre, the southern province close to Ho Chi Minh City.

Photo: Klaus Holsting/Danida

Vietnam is a country in development. The country’s growth rates and trade in recent years have been impressive, and Vietnam is developing into a commercial hub in South-East Asia. This development has benefited large sections of the Vietnamese population. In 1993, 60 per cent of Vietnamese people lived below the poverty line. By 2013, this figure had dropped to around 20 per cent.

Danish development cooperation with Vietnam began 20 years ago, partly in the form of targeted and long-term support for the fisheries sector and for helping peasants farm fish in their fields. Denmark has played a pivotal role in the development of the Vietnamese fisheries sector and up until 2006 Denmark was responsible for two-thirds of total international assistance to this sector. The close cooperation between Denmark and Vietnam in the fisheries sector has encompassed the entire production chain, and Denmark has supported and advised the Vietnamese on legislation, control measures, fish farming, processing and marketing. This has produced results, with total Vietnamese fish exports growing from USD 550 million in 1995 to almost USD 7 billion in 2013.

The fisheries sector in particular has also played an important role in the large fall in poverty in Vietnam. Almost three million more Vietnamese have found work in the fisheries sector, enabling them to provide for their families. In this way, Danish development cooperation has helped lift over 10 million people out of poverty.

Benefiting both Vietnam and Denmark

Today, the progress of Vietnam’s development is so solid that Denmark has been able to reduce the development cooperation. Danish efforts are now focused on stimulating the burgeoning trade between Denmark and Vietnam in a way that can create jobs and growth in both countries.

Vietnam’s rapid development has thus not just benefited the Vietnamese population, but also Denmark. A long-standing Danish presence in the country has laid a solid foundation for trade between the two countries, which in 2013 totalled DKK 2.8 billion. This represents an increase of 61 per cent since 2009 and is the highest ever.

There are between 130 and 140 large, medium and small-sized Danish enterprises in Vietnam today, operating in a wide range of fields, including fishing, clothing, medicine, transport, IT and jewellery. Danish enterprises often have a head-start in Vietnam, precisely because of the Danish reputation as a solid and credible partner that has been built up through longstanding development cooperation. Many of the enterprises have Danish divisions, which also regularly create new jobs at home in Denmark.

This is precisely what Denmark’s development cooperation needs to be able to do. Through sustainable growth, the priority countries are to be lifted out of poverty, after which the cooperation is to switch from development to trade, allowing these countries to assume genuine and full ownership.

A promising future

Everything suggests that the Vietnam’s economy will continue to grow, and many also think the growth rate will rocket in the years ahead. This will raise the living standard of Vietnamese people – as well as the demand for increased trade cooperation with Denmark. In 2013, Denmark and Vietnam signed a comprehensive partnership agreement aimed at increasing cooperation within trade, green growth and research. Negotiations are also taking place to draw up a free trade agreement between Vietnam and the EU that will remove tariff barriers between the countries and make it even more attractive to set up and conduct business in Vietnam.

Results 

  • Denmark has supported the Vietnamese fisheries sector since 1993. Today, the programme is completed and over 4.5 million Vietnamese are employed in the fisheries sector. This is around three million more than when Denmark began providing support in 1993. The Danish efforts combined with Vietnam’s own efforts have played an important role in this boost.
  • From 2005 to 2010, the Danish support helped lift over 10,000 families out of poverty. Altogether, these efforts have helped almost 45,000 families out of poverty, because the training and technology that the Vietnamese fishermen have received have spread to other families. With an average farming family composed of 4-5 people, the lives of 200,000-250,000 Vietnamese have thus improved simply as a result of these targeted efforts.
  • Several large Danish firms within fishing and fish farming now sell advisory services and solutions to the Vietnamese market on standard business terms and conditions.

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