Biden showcases Boeing, chip deals as US and Vietnam draw closer
US PRESIDENT Joe Biden announced a series of semiconductor, aerospace and infrastructure deals with business leaders in Vietnam, part of the White House’s push to deepen economic integration with Indo-Pacific nations that can provide a bulwark to China.
Biden touted a “new stage” in the ties between the two countries to a Hanoi meeting of officials and executives from Vietnam and top US companies including Boeing, Intel and Marvell Technology. “My message today is quite simple: Let’s keep it up,” he said.
The announcements were intended to solidify Vietnam’s decision a day earlier to upgrade its relationship with the US to a “comprehensive strategic partnership” – the same designation it uses for China and India. The hope in Washington is that by boosting ties with nations in South-east Asia, the US can increase its influence in a region that sometimes chafes at Beijing’s assertiveness.
Headlining the deal announcements was a memorandum of understanding between Vietnam Airlines and Boeing to purchase 50 737-Max aircraft, a tentative agreement that would be valued around US$7.88 billion and allow the carrier to eventually replace ageing Airbus AE-A321 planes. Any delivery could be years off, however, as Boeing has sold out most of its production slots through the end of the decade.
Vietnam had previously announced plans by US-based Amkor Technology to build a US$1.6 billion factory in Bac Ninh province, while Synopsis and Marvell Technology are both working to establish semiconductor design centres in Vietnam.
The Biden administration has prioritised improving the semiconductor supply chain over concerns the US has become too reliant on Taiwan’s semiconductor industry.
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Technology companies including Microsoft and Nvidia announced new programmes to make emerging artificial intelligence technology more accessible to Vietnamese businesses, while Meta Platforms unveiled a new effort to help small and medium-sized businesses in the country use digital tools. Apple has also expanded its footprint in Vietnam as it diversifies its supply chain beyond China.
Other announcements focused on traditional infrastructure. The US president has increasingly promoted US financing for projects in the developing world to counter China’s Belt and Road Initiative; this includes a new rail, natural gas and fibre corridor that would link India to Europe through the Middle East, announced earlier this week at the Group of 20 summit in New Delhi.
In Vietnam, SSA Marine announced it would partner Gemadept, a Vietnamese sea freight transportation company, on a proposal for a US$6.7 billion port and logistics centre in the southern part of the country. Massachusetts-based Australis Aquaculture signed a memorandum of understanding to spend US$100 million to expand its operations in Van Phong Bay.
And one announcement was focused on the future of Vietnamese money – literally.
Crane NXT announced its plans to partner Vietnam’s Hi-Tech Polymer to develop the next generation of banknotes for the State Bank of Vietnam.
Even more commercial deals with Vietnam may become possible in the future, after the US pledged to consider the country’s formal request to review its market economy status. A favourable review by US authorities could decrease duties on some imports from Vietnam. BLOOMBERG
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