"We are ready to serve you, the business people to promote the traditional friendship and co-operation between Vietnam and Sri Lanka," ambassador Thanh said.

"We should join hands with each other boost our ties for the prosperity of both countries."

Investment

Several Vietnam firms were keen to invest in Sri Lanka including PetroVietnam. Vietnam's mining groups have been leading the country's outward investments.

"We have a lot of experience in oil and gas exploration now," Thanh said. "So now we can join with Sri Lanka to explore oil and gas."

According to data published in Vietnam Economic Times, the state petroleum firm has a pipeline of 25 projects in 17 countries with 900 million dollars already invested in 18 ventures.

Neighbouring Cambodia and Laos have been top recipients of Vietnam investments in natural resources, rubber, leisure, hydro power and other areas.

Thanh says the establishment of a branch of a Vietnam bank would boost business and there is interest from in the financial sector in Sri Lanka.

"We need support from the Sri Lankan people, the government, for licensing and clearing procedures," he said.

FDI

Vietnam itself is receiving tens of billions of dollars of investment from Japan, Korea, Western Europe and the United States.

Thanh says three 120,000 foreign invested projects in Vietnam after it liberalized foreign investments and later decentralized investment approval to regions.

"To develop fast we need as much investment from abroad as possible," Thanh said. He said his government was striving to combat some negative aspects of foreign investment and improve the quality of investments.

Vietnam was ready to share its experience and strategy with Sri Lanka if needed, he said.

In the first four months of 2010 foreign collaborated projects in Vietnam had invested 3.62 billion dollars, though new project approvals have fallen 47 percent to 4.0 billion dollars, a Vietnam news agency report said.

For the entirely of last year Sri Lanka received about 500 million dollars of foreign investment.

Vietnam's southern Ho Chi Minh City area alone had attracted a billion dollars to 58 new and seven expanded projects. The country is expecting about 20 billion dollars in new sign ups in 2011.

Sri Lankan firms had invested about 13 million dollars in Vietnam so far.

Trade Leap

Two-way trade between to two countries had risen to 93 million dollars last year, up more than 50 percent from 60 million a year earlier, Thanh said.

"This is a big leap forward," he said. "I hope with the opening of the embassy here, we can do some other measures and the trade volume can increase even further."

Sri Lankan businesses who are investing and trading with Vietnam have been eagerly awaiting the re-opening of the embassy as getting pre-approved visas or visa's from Delhi took several weeks and cost as much as 270 dollars.

Thanh says the embassy which is operating from a temporary office, will begin to issue visas from the middle of next month.

Vietnam is a efficient food producer and a net exporter of rice.

Travel Ties

The opening of the embassy could also boost two-way tourism making it easier for Sri Lankans to get visa and giving confidence to Vietnamese people to travel to the island.

Vietnam has a growing middle class that is travelling out, but there is a reluctance to visit a country in which there is no embassy.

"Vietnamese people also want to visit Sri Lanka, it is beautiful country," Thanh said.

"It is also a Bhuddist country and Vietnamese are becoming rich now and they want to go to new destinations."

In the first three months of 2011, Vietnam had received 1.2 million foreign visitors which 893,000 coming from holiday, 249,000 for business and the balance to visit relatives and other purposes data from Vietnam's tourist office said.

In the first quarter, 143,000 visitors came from South Korea, 136,000 from Japan, 133,000 from USA and 86,000 from Australia. China was the top source of visitors with 287,000.

Sri Lanka received a total of 215,000 foreign visitors in the first quarter of 2011.

Lanka Business Online - April 28, 2011