Facing tough competition from Thailand and Indonesia, Vietnam is busy preparing tastier baits to lure foreign direct investment.
“We will build Vietnam into an investment destination far more attractive than other regional nations,” Prime Minister Nguyen Tan Dung told last week’s Consultative Group (CG) meeting for Vietnam in Hanoi.
To that end, Ministry of Planning and Investment (MPI) Minister Bui Quang Vinh told VIR during the CG meeting many investors from South Korea, Japan, Taiwan and Germany had assured that they would implement major projects in Vietnam if the country’s investment and business climate was improved.
“We cannot miss this opportunity. The more difficulties the Vietnamese economy faces, the more foreign direct investment (FDI) it needs to lure, because FDI can pump big capital and high technology into Vietnam,” Vinh said.
Citing Bac Ninh province-based Samsung Electronics Vietnam as an example, Vinh said the firm had increased its investment capital from $670 million for the first phase to $1.5 billion for the second phase, after the government gave it tax incentives for the expanded project. Specifically,
Samsung Electronics Vietnam will enjoy a 10 per cent corporate income tax for all products manufactured at the new factory instead of 25 per cent commonly applied, though under existing laws, an investment expansion will not be granted incentives like a newly established project.
“With the tax incentives, Samsung will continue its investment,” Vinh said. “Such projects from South Korea, Japan, Taiwan and Germany will be deployed in Vietnam if more incentives [like those for Samsung] are given to them.”
Vinh said 2013 would bring positive changes in Vietnam’s investment and business climate, thanks to the National Assembly’s expected adoption of a series of business-related laws, such as the revised Investment Law, the revised Corporate Income Tax Law, Public Investment Law and the revised Land Law.
“When these laws and their guiding decrees are enacted, a more attractive investment will be created. Besides, Vietnam’s increasingly-improved economic situation and administrative procedures in 2013 will create better conditions for more FDI to come into Vietnam,” Vinh said.
“The Vietnamese government’s most important message to foreign investors is that Vietnam will continue bettering its investment and business climate in favour of them,” Vinh noted.
The MPI reported that Vietnam’s pledged FDI capital this year would be about $15 billion, while the disbursement was expected to be around $11 billion. The same figures were also expected for next year.
“Given Vietnam’s economic conditions and the world’s ever-growing economic woes, these figures are quite good and mirror investors’ big confidence in Vietnam’s economic potential,” Vinh said.
The MPI said Vietnam was currently faced with regional rivals in FDI attraction like Thailand , Indonesia and newly emerging Myanmar. Thus Vietnam must improve its investment environment as soon as possible.
Zaw Naing Thein, member of the Union of Myanmar Federation of Chamber of Commerce and Industry, told VIR that in a bid to lure FDI, Myanmar ’s government would not hold monopoly in almost all sectors, which could be joined by private investors with favourable investment incentives for them. “This point is much more attractive to foreign investors than in other regional countries including Vietnam ,” Thein said.
Nguyen Dat | vir.com.vn
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