Viet Nam commits to stable business community
Viet Nam is committed to maintaining a stable environment to ensure the rights and interests of foreign businesses investing in the country, said Deputy Prime Minister Truong Hoa Binh at the 24th International Conference on the Future of Asia in Tokyo on Monday.
He said the Government would continue to work on the legal system and policies related to investment in a consistent and transparent manner. The Government would also strive to improve law enforcement, strengthening and focusing on solving problems for investors.
According to the deputy PM, the peaceful environment, co-operation and development had made Asia an economic, political and cultural centre accounting for 45 per cent of global GDP, which is expected to rise to 50 per cent by 2025. Asian countries have also become bigger players in global trade and investment, accounting for around one-third of international foreign direct investment, import and export values.
"Openness and co-operation are key factors for recovery and to create new momentum for economic growth," the Deputy PM said.
Binh was optimistic about the future, but warned of potential challenges to the regional and global economies.
He mentioned three major risks. Firstly, the rising tide of protectionism, increased uncertainty in powerful countries and tensions in trade relations among the world’s leading economies.
"In a world of tightly intertwined interests, any escalation of tensions could disrupt the international financial system, as well as regional and global supply chains. Policies that go against globalisation, trade and investment liberalisation could have unpredictable implications. Putting national interests in conflict with the global interests would undermine confidence and achievements," said Binh.
Secondly, with progress in science and technology, the industrial revolution 4.0 opens up tremendous growth opportunities but also presents challenges for Asian countries, especially developing countries. According to the International Labour Organisation, more than two thirds of workers in the textile and footwear sectors as well as manufacturing industries in Southeast Asia are threatened by the rapid application of science and technology.
Thirdly, non-traditional security issues such as natural disasters, food-water-energy security, epidemics, maritime security, climate change and the rich-poor divide and social diversification are challenges for the development of Asian countries. In order to build a prosperous and stable Asia, environmental protection needs to be a pillar of development.
Binh said Viet Nam highly valued the Japanese Government’s efforts to accelerate the conclusion of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
"We hope that Japan, as a leading economic partner of many Asian economies, will serve as a locomotive to enhance regional economic integration and connectivity," said Binh.
At the summit, the Deputy PM also highlighted the important progress that Viet Nam had made over the past three decades, linked to Asia’s growing status and regional economic integration. Open, multilateral and diversified foreign policy had helped Viet Nam overcome difficulties and integrate with the world, he said.
The renewal process had helped the country to transform and achieve significant socio-economic development. With an average annual growth rate of 6.6 per cent over the past three decades, Viet Nam’s GDP soared 35 times to US$220 billion in 2017 and was expected to reach $300 billion by 2020. In 2017, The country maintained macroeconomic stability, controlled inflation (at 3.5 per cent), reached a record $425 billion in trade turnover and over $60 billion in foreign exchange reserves.
The country has attracted $325 billion of registered FDI from 127 countries and partners around the world. In 2017, the country rose 14 places on the global business environment index to 68/190, according to the World Bank. Viet Nam’s competitiveness index also rose 5 places to 55/137 on the World Economic Forum’s ranking.
Credit rating agencies such as Moody’s and Fitch have raised the rating level for Viet Nam’s economy from "stable" to "positive", and a number of transnational corporations have chosen Viet Nam to invest in development and connectivity in the global value chain, said Binh.
The deputy PM said that Viet Nam and Japan were preparing to celebrate the 45th anniversary of Viet Nam-Japan relations (1973-2018).
Japan is the largest investor in Viet Nam with total direct investment of more than $9 billion. Two-way trade reached over $33 billion. The recommendations of the Japanese business community are always recognised and resolved by the Vietnamese Government, said Binh.