Germany, Vietnam sign strategic partnership during Merkel visit

Oct 11, 2011, 8:55 GMT

Hanoi - Chancellor Angela Merkel signed trade and other agreements with her Vietnamese counterpart during her first visit to the country Tuesday.

The agreements covered politics, trade and investment, justice, environmental protection and education.

The chancellor said Germany supported Vietnam's efforts to become a market economy and 'is a very strong supporter' of a trade pact between the European Union and Vietnam.

The EU announced negotiations for the deal in March last year, but these have yet to start.

'Vietnam set a target to become an industrialized country by 2020 and Germany would like to help Vietnam in this process,' Merkel said.

But she stressed that foreign companies needed a more secure legal environment to develop effectively in Vietnam.

She also said 'the development of human rights is of great importance,' calling for greater freedom of the press and expression, and respect for human rights.

The chancellor also criticized Vietnam's use of the death penalty and the number of government critics in prison.

Vietnam is one of South-East Asia's fastest-growing economies, but suffers from double-digit inflation and a large trade deficit.

Germany is its biggest trading partner in Europe. Bilateral trade has increased 15 per cent over the last decade, topping 6 billion dollars in 2010.

Vietnamese Premier Nguyen Tan Dung said he saw 'potential to raise trade volume.' German products currently account for 2 per cent of Vietnam's imports.

Merkel also pledged 467 million euros (637 million dollars) in official development assistance. Since 1990, Vietnam has received 1.5 billion euros in development grants and loans from Germany.

The chancellor was to travel to Vietnam's business capital, Ho Chi Minh City, on Wednesday and on to Mongolia the same day.

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