Oct 4, 2011

Vietnam - New strategy targets breakthrough in FDI attraction


The Ministry of Planning and Investment (MPI) is working on a new strategy on attracting foreign direct investment (FDI), with a significant shift in the approach to the issue.

The strategy will focus on defining FDI’s role in the country’s socio-economic development plan for the 2011-2015 and 2011-2020 periods. It will analyse strong and weak points of Vietnam ’s FDI attraction policies as well as its business and investment environment.

Vietnam has reached a point where it needs to be more selective in order to increase quality and sustainability of FDI flow, said Do Nhat Hoang, head of the Ministry of Planning and Investment's Foreign Investment Agency.

Hoang said priorities will be given to public-private cooperation and areas such as production and manufacture, which are expected to create high added values.

Sharing Hoang’s views, Tran Dinh Thien, director of the Vietnam Institute of Economics, also underlined the need for Vietnam to have a firm standpoint in FDI attraction, avoiding the spread of priorities.

Vu Tien Loc, chairman of the Vietnam Chamber of Commerce and Industry (VCCI) agreed that the new strategy needs to target higher quality projects.

A survey conducted by the VCCI reveals that only 13.5 per cent of FDI businesses are operating in the fields that bring high added values, which, Loc said, is a worrying sign.

The draft strategy also places emphasis on environmental protection to advance towards sustainable development. This will be a fundamental criterion when considering licences to FDI projects.

According to Nguyen Duc Thang, MPI’s expert on environment and sustainable development, on the reasons for Vietnam to be dubbed a “paradise for investment” is its low standards on environmental protection.

“If the situation continues, it will pose great risks for the future,” Thang warned.

The Central Institute of Economic Management in a recent report put stress on the need to promptly implement a number of solutions to improve the quality of FDI flow, firstly changing the way of thinking regards the attraction and utilisation of this source of capital.

vir.com.vn



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