Vietnam adopts measures to attract additional foreign investors
Vietnam adopts measures to attract additional foreign investors
In the context of the fourth Covid-19 wave with complicated developments, Vietnam is striving to remain an attractive destination for foreign direct investment (FDI).
Industrial zones simultaneously combat the pandemic and maintain production
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Pursuing dual goal
According to Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc, although global FDI growth is yet to show any sign of recovery, Vietnam achieved satisfactory results in the first half of 2021, with US$15.27 billion attracted through new projects, capital increases of ongoing projects, and stock purchases and capital contributions by foreign investors. This reflected the efforts and determination of the government, ministries, sectors and localities to implement the dual goal of containing Covid-19 spread and promoting economic growth.
The fourth wave of Covid-19 outbreak, concentrated in the northern provinces of Bac Giang, Bac Ninh, and southern localities such as Binh Duong, Dong Nai, and Ho Chi Minh City, where hundreds of industrial parks are located and which are the destinations of many foreign investors in Vietnam, had raised concerns about its adverse impact on FDI attraction. However, along with strenuous efforts to contain the pandemic, these localities have strived to create favorable conditions for businesses, especially large, multinational groups, to maintain safe production and increase investor confidence.
Hua Quoc Hung, Head of the Ho Chi Minh City Export Processing and Industrial Zones Authority (HEPZA), said that the city allows enterprises in export-processing, industrial and high-technology zones to maintain production during the quarantine period. A steering committee for pandemic prevention in industrial zones has been established.
Businesses have also set up their own Covid-19 safety working groups and inspection teams have been established to supervise pandemic prevention at businesses.
Improving FDI attraction
Effective control of the Covid-19 pandemic in 2020 and early months of 2021 has given Vietnam an advantage in attracting foreign investors. The Vietnamese Government has established a working group to help multinational groups and major foreign companies seize investment opportunities in Vietnam.
Dr. Tran Hoang Ngan, Director of the Ho Chi Minh City Institute for Development Studies, said that Vietnam should take the initiative in “coexisting safely with Covid-19”. In his opinion, this will enable businesses to maintain operations, preventing supply chain disruptions. “For its multifaceted achievements, Vietnam still attracts foreign investors. It should continue accelerating administrative reforms to create a more open business and investment environment.
Vietnamese localities should be ready in terms of infrastructure and human resources, especially a highly qualified workforce, to welcome foreign investors,” said Hirai Shinji, Chief Representative of the Japan External Trade Organization (JETRO) in Ho Chi Minh City.
The Ministry of Planning and Investment is completing a prime ministerial draft decision on special investment incentives to attract projects using advanced technologies, creating high added value and connected to global manufacturing and supply chains. These incentives are related to corporate income tax, land rent and water surface rent. Investment projects violating their commitments will have to refund the amounts of tax/rent reductions.
| The Law on Investment, Law on Enterprises, and Law on Public-Private Partnership have been amended to simplify investment procedures and ensure transparency, helping Vietnam attract more FDI. |
