The current regulations cause difficulties for foreign
investors trying to obtain investment
Certificates
State management authorities
want more clout to supervise foreign-invested enterprises.
They made the request during a
recent meeting between the Ministry of Planning and Investment (MPI) and local
authorities on the management of foreign direct investment (FDI).
All attendees said the existing
legal framework was all about supervising the licensing of new projects, but
failed to spell out measures to manage the operations of firms that were
already up and running.
According to the Investment
Law, foreign investors must complete a checklist of administrative procedures,
including providing details on environment protection and handing over detailed
investment plans before obtaining investment certificates. In many provinces,
investors also have to come up with evidence of their financial ability and
even deposit money towards their projects.
“The current regulations cause
difficulties for foreign investors trying to obtain investment certificates.
But once investors overcome this step, state authorities fail to manage them,”
said Do Nhat Hoang, director of MPI’s Foreign Investment Agency.
Hoang said this failure would
negatively impact on the quality of FDI in Vietnam. He said cases of
environment pollution and construction delays at FDI projects were the consequence
of slack management.
Taiwanese seasoning producer
Vedan Enterprise Corp is one example. The firm illegally discharged wastewater
directly into Thi Vai River in Dong Nai province for a long period before being
detected in 2008. And the recent disappearance of US-backed Good Choice Limited
Company, the developer of the long-delayed $1.3 billion Wonderful Theme Park
project in Ba Ria-Vung Tau province, has raised alarms about the failure of
provincial authorities in supervising foreign investors.
Nguyen Van Tu, deputy director
of Hanoi’s Department of Planning and Investment, said the existing Investment
Law did not grant state authorities enough power to closely supervise the
operation of investors in the country.
A year ago, Prime Minister
Nguyen Tan Dung signed Decision 77/2010/QD-TTg forcing foreign-invested
enterprises to report gross revenue, production, legal capital, sources of
disbursed capital, recruited labour, manufacturing technology and tax every
month to local statistics offices. However, many firms had flouted this
regulation.
“Just a few enterprises have
reported during the past year. But even for those enterprises that report, we
don’t know whether their reports are true,” said Hoang.
The lack of detailed reports on
business operations and FDI attraction had been a roadblock for the
government’s efforts to issue correct policies for foreign enterprises in
Vietnam, he added.
vir.com.vn
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