Deputy Prime Minister Pham Binh Minh: "Territorial disputes affect the economy"

The story of China illegally placing an oil rig in the East Sea in 2014 was once again mentioned by the Vietnamese Government leader when attending the World Economic Forum in Davos (Switzerland).

The above viewpoint was expressed by Deputy Prime Minister Pham Binh Minh at a discussion session on Geopolitics, within the framework of the World Economic Forum (WEF) in Davos (Switzerland) on the night of January 23 (Hanoi time). The discussion was also attended by German Defense Minister - Ursula von der Leyen, Korean Foreign Minister - Yun Byung Se, Iranian Foreign Minister - Javad Zarif and CEO of Henkel (Germany) - Kasper Rorsted, who are expected to find out issues that may affect industries and the economy in 2015.

Many hot issues were raised, such as instability in Ukraine, economic sanctions against Russia and Iran, terrorism, religious conflicts, falling oil prices, the risk of a cold war or the nuclear issue in North Korea. The German representative said that economic sanctions would have a better impact than military intervention. Meanwhile, the Iranian Foreign Minister affirmed that negotiations are better than sanctions.

During the discussion, Deputy Prime Minister Pham Binh Minh commented: "In our region, territorial disputes are increasing." He said this is a problem not only for the region but also for the world.

Deputy Prime Minister Pham Binh Minh at the session on Geopolitical Outlook. Photo: WEF

The Deputy Prime Minister stated that the East Sea is a very important route for transporting goods to East Asia, and from East Asia to other regions of the world. Therefore, territorial disputes or any problems that occur here will affect the economy, the freedom of movement of goods and the maritime industry. He also mentioned that in 2014, China illegally placed an oil rig in Vietnam's exclusive economic zone, affirming that this violated international law.

When asked about the most serious threat of the year, the Deputy Prime Minister commented: "I think territorial disputes may occur in the East Sea this year. This could threaten stability in the region."

When referring to China in economic terms, he also did not deny that "China's growth creates many opportunities for neighboring countries". For example, this country is Vietnam's largest trading partner with an annual bilateral turnover of about 50 billion USD. Trade has helped boost the economy, so China's slowing growth could affect trade and investment here.

Before that, the Deputy Prime Minister also attended a discussion session on Southeast Asian countries - ASEAN. The session was attended by representatives of three other economies in the region, including Cambodian Prime Minister - Samdech Techo Hun Sen, Malaysian Minister of Economic Planning - Abdul Wahid Omar and Thai Deputy Prime Minister - Pridiyathorn Devakula.

Former German Vice Chancellor Philipp Rösler also appeared as the opening act. He said he was born in Vietnam but grew up in Germany. In addition, as a member of the WEF Executive Board, he is also very interested in the establishment of the ASEAN Economic Community (AEC) and understands that this is an important event in the region.

Deputy Prime Minister Pham Binh Minh during a discussion session on the ASEAN Economic Community. Screenshot

The theme of the meeting was how ASEAN countries can benefit from increased regional unity in the new global economic context. Mr. Hunsen said ASEAN will benefit from the growth of global markets and policies promoting free trade. However, countries in the region are still facing many problems, such as maintaining macroeconomic stability, the middle-income trap and the widening gap between rich and poor.

Meanwhile, the Thai Deputy Prime Minister said that the AEC will help remove tariff and non-tariff barriers between countries in the region. In the past 20 years, the removal of tariff barriers has been carried out quite regularly. It is expected that the AEC formation process will be completed by the end of this year.

He also said that industrialized countries would benefit from cooperation with emerging countries, as private capital flows between countries. In addition, he said that free trade agreements (FTAs) should be signed between ASEAN and major trading partners, instead of just bilaterally. Then countries in the region would have a better negotiating position.

Deputy Prime Minister Pham Binh Minh commented that Southeast Asia will have to deal with many challenges when establishing the AEC, such as uneven growth, or ASEAN needs to play a central role in the cooperation mechanism with development partners. In addition, he also emphasized that each country needs to accelerate economic reform and to be successful, countries need to trust each other to solve common problems.

According to VNE