South Korea, Vietnam leaders pledge deeper ties amid trade challenges

Seoul, South Korea - South Korea and Vietnam pledged deeper economic and strategic cooperation as their leaders held a summit on Monday, Aug. 11, with the countries seeking to leverage their business ties to navigate a challenging global trading environment.

South Korean President Lee Jae Myung is hosting Vietnamese leader To Lam as his first state guest since taking office on June 4 and discussed promoting trade and investment in the Southeast Asian country, Lee's office said.

Lam, who is the Vietnamese Communist Party general secretary, leads a delegation of industry, trade, foreign and technology ministers and senior party and parliament members on the four-day state visit.

"Our countries agreed that about 10,000 Korean companies operating in Vietnam contribute to Vietnam's economic development and mutually beneficial cooperation between the two countries." Lee said in a televised address.

"I asked for a continued interest in the stable economic activities of our companies in Vietnam."

Lam said the countries agreed to further open up their markets and expand trade to $150 billion by 2030, adding Vietnam welcomed an increase in investment by South Korean businesses along with greater technological cooperation.

The countries are due to sign at least 10 memoranda of understanding at the summit meeting, pledging cooperation in areas including nuclear and renewable energy, monetary and financial policies, and science and technology, Lee's office said.

Other agreements covered cooperation in infrastructure, including high-speed rail, Lee's office said.

The rare visit by the Vietnamese leader is expected to contribute to a favourable condition for South Korean businesses to invest in major infrastructure and nuclear energy projects planned in Vietnam, it said.

A number of major South Korean companies including Samsung Electronics have used Vietnam as an export hub, benefiting for years from lower labour costs, generous tax incentives and Hanoi's numerous free trade pacts with dozens of countries.

But the trade policy of US President Donald Trump, who imposed sweeping new tariffs on the Asian countries in recent weeks, has increased uncertainty over future business commitments, with Vietnamese official data showing a slowdown in new investment.

South Korean companies have been cited as potential investors in Vietnam's planned nuclear energy, LNG power plants and high-speed rail projects.

Trump has imposed a tariff rate of 15 percent for South Korean goods and 20 percent for imports from Vietnam.

(Reporting by Jack Kim, Joyce Lee and Heejin KimEditing by Ed Davies)