VietNamNet Bridge – Italian Prime Minister Matteo Renzi will begin a two-day visit to Vietnam on June 9, in an effort to strengthen the strategic partnership between the two countries, especially in economics, trade and investment.

Located in Southern Europe, Italy is the ninth largest economy in the world, but imports up to 75% of its material demand to feed its industries.

Italy’s economic development model is relatively similar to Vietnam’s. Its small and medium sized businesses operate efficiently, contributing nearly two thirds of the country’s GDP.

Throughout the last decade, Italy pursued a coherent financial policy to meet the requirements of the Economic and Monetary Union (EMU) of the European Council. Yet its economy has slowed down since 2000 with budget deficit exceeding the EU’s 3% limits of GDP.

The global economic recession, especially the European public debt crisis, has taken its toll on Italy – an export-driven economy which relies heavily on material imports.

Italy's trade policy is closely associated with the EU’s economic policy, with key economic sectors such as tourism, trade, industry, telecommunications, textiles, footwear, ceramics, and agriculture.

Italy mainly develops trade relations with the EU, US and countries in the Mediterranean Sea. It is currently promoting foreign trade with Asian countries, including ASEAN member states.

Vietnam and Italy established diplomatic relations on March 23, 1973. Bilateral political ties developed strongly in the 1990s.

Italy was the first western European nation to support cooperation between Vietnam and the European Union, and the normalisation of relations between Vietnam and international trade, financial and monetary organisations in the nineties.

Since Foreign Minister De Michelis’ official visit to Vietnam in December 1989, the two countries have maintained regular high-level exchange visits. Italian leaders expressed their desires to strengthen all-round cooperation with Vietnam, considering Vietnam a priority country for development in Southeast Asia and a destination for Italian businesses till 2020.

On January 21, 2013 Vietnam and Italy signed a joint statement on the establishment of strategic partnership between the two countries during Party General Secretary Nguyen Phu Trong’s visit to Rome.

Both countries signed an action plan to realise the strategic partnership for 2013-2014 during Deputy Prime Minister Hoang Trung Hai’s Italy visit in September 2013.

They launched various activities celebrating 40 years of diplomatic ties in 2013, the Vietnam Year in Italy and the Italy Year in Vietnam.

Two-way trade has increased considerably over the years, reaching US$2.8 billion in 2012 and US$3.5 billion in 2013. Major Vietnamese exports are footwear, seafood, coffee and garments, and its imports are machinery, mechanical equipment, means of transport, and leather accessories.

The Italian government has included Vietnam in the top ten emerging economies for prioritised trade and investment development.

Vietnam Ministry of Planning and Investment statistics show that as of 2013 Italy ranked 29th among 100 foreign investors in Vietnam, with 53 licensed projects capitalised at US$294 million. Its major investment areas are the processing and manufacturing industry, shoe and leather footwear, construction, sanitary wares, and steel making.

Italy began providing official development assistance (ODA) for Vietnam in the 1980s, focusing on water drainage, environmental protection, human resource development, and health care. It has committed ODA to Vietnam over 2014-16.

PM Matteo Renzi’s visit this time offers the two countries a chance to enhance the strategic partnership, especially in economics, trade, investment, culture, education science-technology, energy and tourism.

Source: VOV