UAE tightens Vietnam ties with Etihad’s daily flights to Ho Chi Minh

The launch of direct flights by Etihad Airways between Abu Dhabi and Ho Chi Minh City in Vietnam is expected to give travel and trade a boost.

A general of Ho Chi Minh City. Etihad Airways started daily services to the Vietnamese city last week. Luong Thai Lunh / EPA
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The launch of more flights from the UAE to Vietnam is expected to lead to greater ties between the two nations.

Last week, Etihad Airways started daily services to Ho Chi Minh City, which will introduce about 3,700 seats a week.

As a result, tourism is expected to increase. Tran Ngoc Thach, the Vietnamese ambassador to the UAE, expects 20,000 visitors from Vietnam to the UAE this year, compared with 14,000 in 2011. In the reverse direction, about 5,000 tourists from the UAE have travelled to Vietnam this year.

Trade between Vietnam and the UAE is expected to touch US$4.5 billion this year and $6bn in the next, Mr Ngoc Thach said.

Trade has been rising over the past few years. Last year, it stood at $2.5bn, compared with $500 million in 2009.

The UAE’s exports to Vietnam include oil and gas, plastic and dates.

Etihad’s flights to Vietnam have a cargo capacity of 13 tonnes.

“Cargo is a growing opportunity to accelerate two-way trade [with Vietnam] from the UAE and across the Arab world,” said Peter Baumgartner, the chief commercial officer at Etihad.

“The new flights will encourage investments by the UAE Government and private businesses in energy, infrastructure, tourism and civil construction.”

UAE businesses have invested about $1.5bn over the past decade in hotels and high-rise buildings in Vietnam, but investments slowed down during the global downturn.

Dubai’s DP World invested $230 million in Hiep Phuoc port, which was completed in 2010.

In January, Vietnam’s WorldTech Transfer Investment and the UAE-based Global Sphere started construction of a $300m solar panel manufacturing plant in Vietnam’s central province. It is expected to be completed in two-and-a-half years.

On the other hand, the bulk of Vietnam’s exports to the Emirates comprises finished products such as computers and mobile phones, followed by fresh produce such as fish. Other goods include footwear, textiles and garments, paper and coffee.

South Korea’s Samsung Electronics has a handset manufacturing base in Vietnam and this year, it invested $2bn to double its capacity because of cheaper labour costs compared with China.

Samsung produces 40 per cent of its handsets in Vietnam, about the same from its facilities in China.

Vietnam is also trying to build some exposure for its companies in the emirates.

“We are trying to build a showroom for Vietnamese companies in Dubai where UAE companies can see our products,” Mr Ngoc Thach said.

About 8,000 Vietnamese work in the UAE.

ssahoo@thenational.ae