Two of the six memorandums of understanding witnessed by Lee and his Vietnamese counterpart Nguyen Xuan Phuc were for industrial parks to be developed by Singapore's Sembcorp in central Vietnam.

"I'm very glad to be back to Vietnam after more than three years in order to take our relationship another step forward," Lee told reporters at a joint press briefing with Phuc.

Singapore, one of Vietnam's top investors and trading partners, hopes to step up investments in the country, Lee said.

"With more intensive business links and with more tourism between both sides, travel between Vietnam and Singapore has increased substantially," Lee said.

Phuc said the two leaders were committed to enhancing the partnership between Vietnam and Singapore in all fields.

The two leaders discussed regional and security issues and in particular the South China Sea, Lee said, where issues should be resolved "in accordance with the international law including the U.N. Convention on the Law of the Sea ... and also on the freedom of navigation on the important artery of global commerce in the South China Sea."

Vietnam and China along with the Philippines, Malaysia, Brunei and Taiwan claim parts of or all of the South China Sea.

Vietnam is a vocal opponent of China's expansion in the South China Sea.