The American President is coming to this November’s APEC summit to talk trade. His Vietnamese hosts, and their Asian partners in innovation, have some additional interests.
by Francesca Ross
“The Fourth Industrial Revolution, particularly digital technology, has fundamentally changed the global economic landscape”, Tran Dai Quang, President of Vietnam recently said. His speech came at the first of a series of meetings of the Asia-Pacific Economic Cooperation (APEC) forum in his country across this year.
“While technology is further connecting mankind and opening up new development opportunities, it also brings no few challenges. Extensive economic integration and shifts in technologies, particularly automation and artificial intelligence, are revamping industries much faster than economies can adapt,” he added.
The APEC sessions in Vietnam will look at trade, technology and a number of political issues. The key November summit of economic leaders will also look at the future of APEC cooperation, beyond the current set of goals which expire by 2020.
Trump will be looking to build relationships with Asian nations
A special guest at this session will be US President Donald Trump. This is one of the first multilateral sessions that Trump will participate in and this shows the rising importance of Asia-Pacific in American concerns. Before visits to Europe, before South America; he comes to Asia.
He will be interested in developing support and consensus on North Korea, and gauge likely reactions to his intention to reform trade relations with China. APEC member state ministers are more likely to be interested in progress on TPP-11.
This is the suggestion that the Trans-Pacific Partnership (TPP) deal which Trump pulled out of could continue without the US. Trump will want to influence the mindset on this – a TPP deal would strengthen a country’s bargaining position in bilateral deals with America.
Trump has said the Vietnamese government is “strong” and this may be why he has chosen Hanoi for his first visit. Vietnam enjoys a good relationship with the US. American industries took US$40 billion of Vietnamese goods in 2016. This figure has grown every year since 2009. Vietnam took just $US10 billion of goods in the other direction.
Economic cooperation is essential for Vietnam
APEC is still a better prospect for Tran Dai Quang’s country. APEC member economies currently contribute up to 70% of Vietnam’s inward investment, with total capital of US$300 billion. These operations make up 25% of GDP, 35% of industrial output and 70% of export value.
The Vietnamese Deputy Minister of Science and Technology, Tran Quoc Khanh, opened one of the early APEC sessions saying his country was interested in using APEC structures to strengthen science and technology ecosystems regionally.
APEC’s science and technology drive promotes innovative economic growth by 2025 by enabling scientific research and market-based innovation. This is an important consideration for Vietnam as it needs to successfully integrate into the world economy and join global value chains to commercialise Vietnamese innovation and fuel growth.
Research funded to the tune of US$100,000 by the APEC partnership in Vietnam is looking to support technology startups which need promotion, advice and work on fundraising. This will move Vietnam’s economy from the manufacturing of small value items to sophisticated, higher value industries, researchers say.
Innovation can support Vietnam’s integration into global value chains
Public-private partnerships (PPP) will be vital for Vietnam when commercialising these new opportunities. These can support Asia-Pacific nations build an entrepreneurial ecosystem for technology-based businesses that fuels green-growth value chains. APEC leaders hope enthusiasm for these frameworks can emerge from this year’s series of meetings.
The current problem is that there are a number of countries working on science-based technologies for the greater good, but these are being done on an individual basis, one senior Malaysian diplomat said. It is hoped that APEC structures can support businesses and enterprises with an innovative and environmental value through funding and multi-partner, or multi-country cooperation.
The other issue is about facilitating small and micro-businesses to pick up these technologies and grow their capacity and boost competitiveness. This is where the two sides of the APEC discussions come full circle. Businesses need support to develop and adopt technology, but they also need routes to take this technology around the region, and the world.
Asian leaders have much to offer, and they should not forget it
Trump’s arrival in Asia is a big story, and Vietnam will benefit from the attention and focus his attendance brings, but APEC must not be overshadowed by politics. Trump is coming to further his own interests but APEC leaders are in the driving seat. He knows Asia-Pacific is the global centre for emerging innovation and is vital for his country’s success.
He has an eye on beneficial trade deals. Asia’s decision-makers need routes to market for new technologies. One can support the other but expect Asia to put Asia first. Trump might not like it but he should at least respect it. In his country, he says just the same.