SINGAPORE — President Tony Tan Keng Yam yesterday lauded close economic ties between Singapore and Vietnam, as he hosted a state visit by his counterpart Tran Dai Quang.

“We are honoured that your excellency is making a visit to Singapore just a few months after assuming office. This attests to our warm and close relations ... Vibrant economic cooperation has been the mainstay of our relations,” said Dr Tan during a state banquet at the Istana yesterday evening in honour of Mr Quang.

Mr Quang’s visit coincided with the celebration of the 43rd anniversary of diplomatic relations this year and the third anniversary of a bilateral strategic partnership. He was nominated as the country’s president in January.

Dr Tan noted that the Republic is Vietnam’s third-largest investor with cumulative Foreign Direct Investment (FDI) of approximately US$38 billion (S$51.7 billion) in more than 1,600 projects, ranging from ports, logistics, healthcare and real estate.

The seven Vietnam-Singapore Industrial Park (VSIP) projects have attracted US$9 billion worth of investment and employ over 170,000 people, he said, adding that Deputy Prime Minister Teo Chee Hean will visit Vietnam next month to celebrate the 20th anniversary of the VSIP programme.

Mr Quang warmly welcomes Mr Teo’s visit from Sept 11 to 14, said a joint press statement issued by Singapore’s and Vietnam’s Ministry of Foreign Affairs last night.

Dr Tan also touched on the strong people-to-people links between Singapore and Vietnam. He noted that there are 142 flights a week between the two countries, with over 400,000 Vietnamese visitors coming to Singapore last year and around 200,000 Singaporeans visiting Vietnam in the same period.

Mr Quang said Vietnam has always seen Singapore as a “trusted and respected companion, especially since Vietnam started carrying out reforms and joined Asean (Association of South-east Asian Nations) in the early 1990s”. “We highly appreciate the Singapore government’s regular sharing with Vietnam valuable experiences in governance, economic and human resource development for national industrialisation and modernisation,” he said.

Mr Quang said both countries share common views and strategic interests and that Vietnam appreciates Singapore’s efforts to jointly build trust and promote cooperation in the wider region.

Mr Quang kicked off his state visit yesterday with an official welcome ceremony at the Istana followed by a meeting with Dr Tan. He also met Prime Minister Lee Hsien Loong, who later hosted lunch for the Vietnamese leader.

According to the joint press statement, Mr Quang would instruct officials to follow up on Singapore’s request to expeditiously issue a foreign-owned subsidiary bank licence for United Overseas Bank (UOB) to facilitate provision of financial services in Vietnam.

Both countries also reaffirmed the importance of maintaining regional peace and stability and upholding freedom of navigation in and overflight above the South China Sea.

Both countries emphasised the importance of resolving disputes peacefully, including full respect for legal and diplomatic processes.

Mr Quang also graced the Singapore-Vietnam Business Forum, attended by 250 participants yesterday.

The Vietnamese leader will wrap up his state visit today. Mr Teo will host Mr Quang to breakfast before the latter delivers the 38th Singapore Lecture organised by the Institute of South-east Asian Studies (Iseas) — Yusof Ishak Institute.

Mr Quang will also receive a call by Emeritus Senior Minister Goh Chok Tong later in the day and visit one-north high technology business park before departing for Vietnam.