I am very honoured and happy to be invited to give some opening remarks today at the Vietnam offshore wind webinar organized by Norwep and Innovation Norway Hanoi.
We live in challenging times and the Covid-19 pandemic has changed and is changing the way we live our lives and how business is conducted throughout the world. It’s all about defining the new normal and not about getting back to how it was before Covid-19. It’s not just seeing all the challenges but also looking for the opportunities.
The Norwegian Embassy in Hanoi together with Norwep and Innovation Norway were hoping to invite you all to a major renewable energy conference in Hanoi in November 2020. This conference was planned to have a special focus on offshore wind. Due to the pandemic, we have now postponed the conference to 2021. 2021 is an important year for Norway – Vietnam relations. We will celebrate 50 years of diplomatic relations between our countries. Together with the other Nordic countries Norway was one of the first Western countries establishing diplomatic relations with Vietnam in 1971.
Vietnam and Norway are both coastal nations with equally long coastlines and the majority of the population living along the cost. However, Norway has 5 million people while Vietnam has nearly 100 million. Both countries have a substantial oil & gas industry and the ocean economy or the blue economy plays an important role for both. If you look at a map Norway looks like Vietnam if you turn it upside down.
Norway has one of the world's most developed petroleum industries with state-of-the-art technology, contributing about 50% of our total export revenue. Norway and Norwegian companies want to leverage on our world class competence and experience within offshore activities in the oil and gas sector and transform it and develop offshore wind power projects. We want to be ambitious when it comes to a greener and cleaner energy transition. Norway has been a front-runner in offshore wind development in Europe. We also look much further for attractive opportunities and markets, Asia being one of them with many strong and emerging economies and Vietnam can prove to be a very attractive one.
Vietnam is one of the fastest growing economies in Asia, with a stunning 7 % growth in GDP for several years now. Even in the annus horribilis year of 2020 the World Bank as well as Vietnamese authorities expect economic growth, and very different from what we experience in Europe. Vietnam has a lot of international recognition for its early and decisive actions in dealing with and containing the spread of the COVID19 pandemic – just over 1000 infected people and 27 deaths – which also enhances its international reputation in other sectors. The economic growth goes in tandem with the need to develop more and new sources of energy. In line with the current Power Development Plan for the electricity sector, Vietnam aims to triple its installed power generation capacity over the next ten years. In addition to adding new thermal power stations, the Government of Vietnam is also planning to scale up grid-connected renewables such as solar and wind energy. When it comes to wind it aims to increase the installed capacity substantially (approx. 6,000 MW) by 2030. This is designed to diversify the national power supply and to make it more sustainable as part of the country’s Green Growth Strategy.
Vietnam is considered to have the best wind resources in South-East Asia. In order to harness this potential, the country has introduced the second feed-in tariffs since 2018, and has created a more favorable investment environment and called for investments from the private sector. We expect strong focus on offshore wind in the upcoming master plan #8 that is expected this autumn.
With the importance of economic recovery after Covid-19 and the increasing electricity needs, Vietnam is in the middle of a challenging energy transition. Coal still represents 36% in the energy mix and the import of coal has doubled since last year, mainly from China, Russia and Indonesia. The grid capacity for renewable energy is also a challenge, likewise issues related to governance structure, developing and implementing frameworks for leasing, permitting and PPAs, access to financing as well as aligning expectations with industry and Government. There are no quick fixes. However, there is a stronger will and better understanding than ever at the political level that investing in renewables such as offshore wind will deliver both economic and environmental benefits to Vietnam.
I strongly believe that Norwegian companies in the field of offshore wind will find opportunities within the Vietnam wind energy market. Business opportunities in the offshore wind supply chain should be within reach with cooperation between Norwegian and Vietnamese partners. Thanks to skilled labors at affordable costs and excellent geographical shipping location, Vietnam is a suitable place for outsourcing or licensing your production. However, you need to have a long-term perspective and patience in order to succeed in Vietnam. Innovation Norway, Norwep and the Embassy in Hanoi are ready to provide you with valuable guidance and assistance. Currently I’m in Oslo in the weeks to come. I’m more than willing to meet some of you in Oslo if there is an interest.
Have a great day and enjoy the webinar and hopefully we will be able to meet each other next year in Vietnam!
Thank you, Xin Cam On!