Investment opportunities in Vietnam are still tremendous despite the global economic slowdown, said US executives during talks on business opportunities in Vietnam in Washington on May 28.
They also agreed that Vietnam is still a promising place for those who find the right partners to invest in.
The Vietnamese Ambassador to the US, Le Cong Phung, spoke of the economic achievements that Vietnam has made during the renewal process as well as the growing relationship between Vietnam and the US in political, economic, commercial, educational and many other fields.
The diplomat added that the Vietnamese Government attaches a lot of importance to protecting the environment while developing the economy. “Vietnam is open to every investor in the world, including the US," he added.
Taking part in the forum, were senior officials from US businesses, governmental agencies, science institutions and financial circles, who discussed Vietnam 's energy and environmental needs, lessons the country has learnt from previous investments and opportunities for setting up partnerships.
Michael F. Violette, President of Washington Laboratories Ltd., said: "We are interested in helping Vietnam to address its environmental issues as it develops its economy. Balancing economic development with the need of environment protection is a big challenge."
They focused on how the US and Vietnam could work together to solve problems relating to the quality of water, the infrastructure of clean water supplies and waste management, problems that the Vietnamese Government needs to deal with.
Al Goodman, Principal of Camp Dresser & McKee Inc, which has invested in an US$80-million project to build a water treatment system and a clean water distribution network to serve the Ho Chi Minh City area, said: " Vietnam is little behind in terms of environmental protection but is catching up rapidly, using new technologies, as the government has desire to improve the environment. The private sector also has a role to play in this process. If all the public and private sector get together, I think the standard of the environment will improve very quickly."
The talks were organised by the Maryland-Asia Environmental Partnership in cooperation with the Asia Society and the US State Department's APEC office. (VOV)
Showing posts with label FDI. Show all posts
Showing posts with label FDI. Show all posts
Sunday, May 31, 2009
Sunday, February 22, 2009
Banking - Finance, FDI, Viet Nam Dong - VND
The Foreign Investment Law was issued on December 29, 1987. It was one of the first laws issued during the renovation period. The promulgation of the Foreign Investment Law has institutionalised the Party and State’s policies in effectively attracting foreign investment capital. It is regarded by the international community to be a transparent, attractive code and basically conforms with the international norms. Within the context of fierce competition in attracting foreign investment regionally and globally, the Foreign Investment Law in Vietnam has been a vital lever in attracting foreign investment to Vietnam.
Since the promulgation of the Foreign Investment Law in 1987, the law has been amended four times in 1990, 1992, 1996 and 2000. The issuance of the law as well as of other legal documents relating to foreign investment has created a legal environment for foreign investment activities in Vietnam.
Thus, though the market mechanism in Vietnam has yet to be perfected, foreign investors in Vietnam can still carry out their investment activities in Vietnam without any big differences compared to other countries.
Importance has not only been attached to perfecting legal environment, during the past 20 years, the business and investment environment and the decentralised administration of foreign investment have received due attention. These efforts have contributed to the encouraging foreign investment activities in Vietnam, affirming the significant position of the foreign-invested sector in national industrialisation and modernisation.
By the end of 2007, Vietnam has attracted over 9,500 FDI projects with a total registered capital of US $98 billion, including additional registered capital.
Excluding expired projects and those that have been dissolved ahead of duration, currently 8,590 projects are still valid with a total registered capital of US $83.1 billion. Total registered capital experiences a trend of increasing from 2003 to date.
In 2003, total registered capital increased by six times compared to 2002. In 2004, the figure was up 42.9% compared to 2003; it was 58% in 2005; 75% in 2006 and 69% in 2007.
From 2001 to 2005, Vietnam attracted a total of US $20.8 billion, up 73% against the targeted figure set at the Resolution 09/2001/NQ-CP.
In 2006 and 2007, foreign investment flow to Vietnam increased remarkably with the registry of many large-scale projects in heavy industry and services.
Foreign investment to heavy industry and construction occupies the biggest proportion, accounting for 66.8% of the total number of projects, 60.2% of the total registered capital and 68.5% of the total implemented capital.
From 1988 to the end of 2007, northern localities attracted 2,220 FDI projects with a total registered capital of US $24 billion, accounting for 26% of the project quantity, 19% of registered capital and 24% of the total implemented capital.
Specifically, Hanoi has attracted half of the total registered investment and implemented capital of the whole northern region, followed by Haiphong, Hai Duong and Quang Ninh.
Southern localities from Ninh Thuan southwards have attracted 5,452 projects with total registered capital of US $46.8 billion and total implemented capital of US $15.7 billion, equivalent to 48% of the total number of projects, 56% of registered capital and 51% of implemented capital.
Foreign investment in the Mekong river delta region was the lowest in the country, accounting for only 3.6% of the total number of FDI projects to the country, 4.4% of total registered capital and 3.2% of total implemented capital.
Quang Nam, Da Nang and Phu Yen are currently topping the localities in the central region in terms of foreign investment attraction, though their rate of attraction is still low compared to their potential.
To date, 80 countries and territories have been investing in Vietnam. As many as 68% of these are from Asia; 16.2% from the EU and 11% from America.
The foreign-invested sector is underlining its significance in Vietnam’s economy and is the sector enjoying the most dynamic growth.
Vietnam’s investment and business environment is improving, thus the country is becoming more attractive to both foreign and domestic investors. (Nhan Dan)
Since the promulgation of the Foreign Investment Law in 1987, the law has been amended four times in 1990, 1992, 1996 and 2000. The issuance of the law as well as of other legal documents relating to foreign investment has created a legal environment for foreign investment activities in Vietnam.
Thus, though the market mechanism in Vietnam has yet to be perfected, foreign investors in Vietnam can still carry out their investment activities in Vietnam without any big differences compared to other countries.
Importance has not only been attached to perfecting legal environment, during the past 20 years, the business and investment environment and the decentralised administration of foreign investment have received due attention. These efforts have contributed to the encouraging foreign investment activities in Vietnam, affirming the significant position of the foreign-invested sector in national industrialisation and modernisation.
By the end of 2007, Vietnam has attracted over 9,500 FDI projects with a total registered capital of US $98 billion, including additional registered capital.
Excluding expired projects and those that have been dissolved ahead of duration, currently 8,590 projects are still valid with a total registered capital of US $83.1 billion. Total registered capital experiences a trend of increasing from 2003 to date.
In 2003, total registered capital increased by six times compared to 2002. In 2004, the figure was up 42.9% compared to 2003; it was 58% in 2005; 75% in 2006 and 69% in 2007.
From 2001 to 2005, Vietnam attracted a total of US $20.8 billion, up 73% against the targeted figure set at the Resolution 09/2001/NQ-CP.
In 2006 and 2007, foreign investment flow to Vietnam increased remarkably with the registry of many large-scale projects in heavy industry and services.
Foreign investment to heavy industry and construction occupies the biggest proportion, accounting for 66.8% of the total number of projects, 60.2% of the total registered capital and 68.5% of the total implemented capital.
From 1988 to the end of 2007, northern localities attracted 2,220 FDI projects with a total registered capital of US $24 billion, accounting for 26% of the project quantity, 19% of registered capital and 24% of the total implemented capital.
Specifically, Hanoi has attracted half of the total registered investment and implemented capital of the whole northern region, followed by Haiphong, Hai Duong and Quang Ninh.
Southern localities from Ninh Thuan southwards have attracted 5,452 projects with total registered capital of US $46.8 billion and total implemented capital of US $15.7 billion, equivalent to 48% of the total number of projects, 56% of registered capital and 51% of implemented capital.
Foreign investment in the Mekong river delta region was the lowest in the country, accounting for only 3.6% of the total number of FDI projects to the country, 4.4% of total registered capital and 3.2% of total implemented capital.
Quang Nam, Da Nang and Phu Yen are currently topping the localities in the central region in terms of foreign investment attraction, though their rate of attraction is still low compared to their potential.
To date, 80 countries and territories have been investing in Vietnam. As many as 68% of these are from Asia; 16.2% from the EU and 11% from America.
The foreign-invested sector is underlining its significance in Vietnam’s economy and is the sector enjoying the most dynamic growth.
Vietnam’s investment and business environment is improving, thus the country is becoming more attractive to both foreign and domestic investors. (Nhan Dan)
Dollarization domination
Dollarization in Vietnam is estimated by the State Bank of Vietnam at 21%, relatively high when noting that the figure is 9% in China and 1% in Thailand. Nguyen Dong Tien, Deputy Governor of the State Bank of Vietnam, discussed how serious dollarization is in Vietnam and how to fix the problem.
He said that the Government has asked the State Bank of Vietnam (SBV) to draw up a master plan on reducing dollarization. The plan needs to improve the convertibility of the VND and the value of the VND in international transactions.
Could you please tell us more about the plan?
Previously, experts once suggested that all sums of money transferred from abroad into Vietnam should be converted into VND. However, the Government and central bank decided against this after thorough consideration. Right after this suggestion was made public, the foreign currency inflow into Vietnam decreased sharply.
Therefore, measures to reverse dollarization must be flexible and not extreme, and it is clear that direct intervention or administrative orders are not the right measures. This is the most important requirement for the plan.
Second, measures must ensure that depositors and enterprises have higher confidence in the commercial bank system
Third, it is necessary to make the cost of VND transactions lower compared to US$ transactions, which will help improve the convertibility of the local currency.
Fourth, it is necessary to stabilize the economy, which will result in people having more confidence in the local currency, and get them to keep VND in their wallets.
However, I have to acknowledge that to some extent, we cannot absolutely eliminate the dollarization of the national economy.
IN 2007, the foreign portfolio investment capital into Vietnam reached $6.2bil. Can you see any link between this and dollarization?
As we open the national economy, more and more foreign capital will enter, and if the foreign capital is overly high compared to the absorbability of the national economy, the supply of foreign currencies will be profuse, and dollarization will increase.
We have many choices of ways to deal with the problem. The Government is pursuing the principle that the central bank will continue buying foreign currencies to stabilize the value of the VND. Also, we need to take measures to control the VND supply in order stunt inflation. These steps were taken, to some extent, in 2007, and we will continue them in 2008.
Some experts have suggested that Vietnam should allow foreign investors to open foreign currency accounts to make securities transactions. If so, Vietnam can reduce dollarization, successfully control inflation, while foreign currencies in accounts at commercial banks can still produce profits for money owners. What do you think about this?
I have heard this suggestion. However, it may be contrary to the regulations stipulated in the Ordinance on Forex Management. The ordinance says that all foreign money must be transferred into Vietnam through a special account, and after that, the money must go into investments. (VNeconomy)
He said that the Government has asked the State Bank of Vietnam (SBV) to draw up a master plan on reducing dollarization. The plan needs to improve the convertibility of the VND and the value of the VND in international transactions.
Could you please tell us more about the plan?
Previously, experts once suggested that all sums of money transferred from abroad into Vietnam should be converted into VND. However, the Government and central bank decided against this after thorough consideration. Right after this suggestion was made public, the foreign currency inflow into Vietnam decreased sharply.
Therefore, measures to reverse dollarization must be flexible and not extreme, and it is clear that direct intervention or administrative orders are not the right measures. This is the most important requirement for the plan.
Second, measures must ensure that depositors and enterprises have higher confidence in the commercial bank system
Third, it is necessary to make the cost of VND transactions lower compared to US$ transactions, which will help improve the convertibility of the local currency.
Fourth, it is necessary to stabilize the economy, which will result in people having more confidence in the local currency, and get them to keep VND in their wallets.
However, I have to acknowledge that to some extent, we cannot absolutely eliminate the dollarization of the national economy.
IN 2007, the foreign portfolio investment capital into Vietnam reached $6.2bil. Can you see any link between this and dollarization?
As we open the national economy, more and more foreign capital will enter, and if the foreign capital is overly high compared to the absorbability of the national economy, the supply of foreign currencies will be profuse, and dollarization will increase.
We have many choices of ways to deal with the problem. The Government is pursuing the principle that the central bank will continue buying foreign currencies to stabilize the value of the VND. Also, we need to take measures to control the VND supply in order stunt inflation. These steps were taken, to some extent, in 2007, and we will continue them in 2008.
Some experts have suggested that Vietnam should allow foreign investors to open foreign currency accounts to make securities transactions. If so, Vietnam can reduce dollarization, successfully control inflation, while foreign currencies in accounts at commercial banks can still produce profits for money owners. What do you think about this?
I have heard this suggestion. However, it may be contrary to the regulations stipulated in the Ordinance on Forex Management. The ordinance says that all foreign money must be transferred into Vietnam through a special account, and after that, the money must go into investments. (VNeconomy)
Vietnam eyes 55 bln-foreign investment in 5 years
Vietnam has targeted Foreign Direct Investment (FDI) of some 55 billion U.S. dollars, and realized FDI of 24-25 billion dollars between 2006 and 2010, according to a local investment agency on Tuesday.
Vietnam plans to lure fresh FDI of 41 billion dollars and 14 billion dollars worth of additional capital of operational foreign-invested projects in the five-year period, said the Foreign Investment Agency under Vietnam's Ministry of Planning and Investment.
Vietnam has targeted 5.5-6 billion dollars in realized FDI this year, up from 4.6 billion dollars last year. The country, though eyeing FDI of only 14-15 billion dollars in 2008, is much likely to attract FDI of more than 20 billion dollars this year like it did last year, said the department.
Foreign-invested enterprises in Vietnam are forecast to make total revenues of 38.8 billion dollars in 2008, up 16.5 percent against 2007. They are also predicted to gain export turnovers of 24.3 billion dollars this year, up 21.5 percent over last year.
Vietnam lured a record FDI of 20.3 billion dollars in 2007, bringing the total registered capital to 83 billion dollars with 8,590 operational FDI projects by the end of the year.
Vietnam plans to lure fresh FDI of 41 billion dollars and 14 billion dollars worth of additional capital of operational foreign-invested projects in the five-year period, said the Foreign Investment Agency under Vietnam's Ministry of Planning and Investment.
Vietnam has targeted 5.5-6 billion dollars in realized FDI this year, up from 4.6 billion dollars last year. The country, though eyeing FDI of only 14-15 billion dollars in 2008, is much likely to attract FDI of more than 20 billion dollars this year like it did last year, said the department.
Foreign-invested enterprises in Vietnam are forecast to make total revenues of 38.8 billion dollars in 2008, up 16.5 percent against 2007. They are also predicted to gain export turnovers of 24.3 billion dollars this year, up 21.5 percent over last year.
Vietnam lured a record FDI of 20.3 billion dollars in 2007, bringing the total registered capital to 83 billion dollars with 8,590 operational FDI projects by the end of the year.
50% of RoK investors satisfied with Vietnam’s investment environment
94% of South Korean investors intend to further invest in Vietnam, said Director of Kotra in Hanoi Kim Won Hoo at a recent conference on foreign direct investment in the WTO period.
He said that many South Korean investors see Vietnam as an increasingly important investment market.
However, only some 50% of them have expressed satisfaction with their businesses in Vietnam.
According to Kotra, there are a number of large obstacles to business operations and direct investment in Vietnam.
First, the infrastructure in Vietnam is generally underdeveloped and prices of land and energy have jumped up sharply in a short time.
Second, it is sometimes hard for foreign businesses to recruit skilled labourers with a good command of English, and especially Korean.
Third, as Vietnam’s legal system is incomplete, foreign investors often have to wait for new laws or legal documents.
Kim Won Hoo suggested that Vietnam listen and study foreign investors’ ideas and opinions to keep being a story of success in foreign direct investment. (ANTD)
He said that many South Korean investors see Vietnam as an increasingly important investment market.
However, only some 50% of them have expressed satisfaction with their businesses in Vietnam.
According to Kotra, there are a number of large obstacles to business operations and direct investment in Vietnam.
First, the infrastructure in Vietnam is generally underdeveloped and prices of land and energy have jumped up sharply in a short time.
Second, it is sometimes hard for foreign businesses to recruit skilled labourers with a good command of English, and especially Korean.
Third, as Vietnam’s legal system is incomplete, foreign investors often have to wait for new laws or legal documents.
Kim Won Hoo suggested that Vietnam listen and study foreign investors’ ideas and opinions to keep being a story of success in foreign direct investment. (ANTD)
Foreign investment in Vietnam's apparel disappoints
Vietnam’s textile sector lured much less foreign capital than expected after the country joined the World Trade Organization, according to the annual report of the Association of Garment Textile Embroidery-Knitting.
Foreign investors were reluctant to invest in the industry because of concerns about the U.S government’s monitoring program which applies to certain categories of Vietnam’s textile and apparel products, said the report, which was released Thursday.
Foreign investors committed to invest about US$388 million in 76 projects in 2007, he said.
The commitment represents about two percent of Vietnam’s $20.3 billion record foreign direct investment last year.
Total investment in the sector amounts to about $5.4 billion.
The sources said foreign investment mainly focused on manufacturing items such as fabric, buttons and thread.
Manufacturing, which relies heavily on imports, is the sector’s weakest area.
The top foreign investors by nation were Taiwan with $2.3 billion, Korea with $1.6 billion and Hong Kong with $400 million.
Foreign investors were reluctant to invest in the industry because of concerns about the U.S government’s monitoring program which applies to certain categories of Vietnam’s textile and apparel products, said the report, which was released Thursday.
Foreign investors committed to invest about US$388 million in 76 projects in 2007, he said.
The commitment represents about two percent of Vietnam’s $20.3 billion record foreign direct investment last year.
Total investment in the sector amounts to about $5.4 billion.
The sources said foreign investment mainly focused on manufacturing items such as fabric, buttons and thread.
Manufacturing, which relies heavily on imports, is the sector’s weakest area.
The top foreign investors by nation were Taiwan with $2.3 billion, Korea with $1.6 billion and Hong Kong with $400 million.
A post WTO deluge in FDI is forecasted
Economists have predicted that at least $20 billion in foreign direct investment will flow into Vietnam this year as the country opens its market after its World Trade Organization accession.
At the Vietnam Trade and Investment Forum in Hanoi last week, one year after Vietnam entered the global trade body, investors and economists said foreign direct investment (FDI) had jumped and would continue to rise.
Gannon Vietnam managing director Walter Blocker, who is also vice chairman of the Asia-Pacific Council of American Chambers of Commerce, predicted that Vietnam would continue to attract more than $20 billion in FDI in 2008 after the country opens more sectors per WTO commitments.
“WTO accession had spurred confidence for investment in Vietnam because the country had committed to adhere to an international system,” he said.
Vietnam has been serious about implementing commitments by improving the regulatory climate to make its laws conform more to international practices and to WTO regulations. The country has revised about 30 laws and ordinances.
“The government has proven its constructive economic course in the past. We are convinced that this course will be continued and build a strong foundation for future investment and success,” said Metro Group vice president Henry O.E. Birr.
Last year, Vietnam recorded $20.3 billion in FDI, a 69.1 per cent increase against 2006.
Ashok Sud, European Chamber of Commerce executive committee member, said it was an astounding figure that had far exceeded domestic and foreign commentators’ expectations.
Deputy Prime Minister Pham Gia Khiem said WTO accession created more of a driving force for Vietnam to reform its internal legislative system to come more in line with international practices, creating a favourable and equal business environment for all economic sectors.
Before WTO accession, there was much anxiety and doubt about the Vietnam economy’s adaptability to the tremendous changes in the business environment as well as about its ability to deal with international integration. Khiem said that outside partners had not really believed in Vietnam’s determination to fully and seriously implement its integration commitments.
“Our great achievements in economic development over the past year have wiped out all those concerns and doubts,” he said.
However, World Bank lead economist in Vietnam Martin Rama said that the country had to improve its investment environment, particularly in tackling piracy, copyright infringement and trademark violations. It also needs to strengthen public investment processes and allow the private sector to take part in infrastructure investment, he said.
“Longer-term planning is needed for social infrastructure, such as in education, vocational training and health systems since Vietnam will continue to attract labour intensive industries. But it will also begin to attract the higher-quality investment requiring a higher quality workforce with higher wages,” said Blocker. (Dau Tu Newspaper)
At the Vietnam Trade and Investment Forum in Hanoi last week, one year after Vietnam entered the global trade body, investors and economists said foreign direct investment (FDI) had jumped and would continue to rise.
Gannon Vietnam managing director Walter Blocker, who is also vice chairman of the Asia-Pacific Council of American Chambers of Commerce, predicted that Vietnam would continue to attract more than $20 billion in FDI in 2008 after the country opens more sectors per WTO commitments.
“WTO accession had spurred confidence for investment in Vietnam because the country had committed to adhere to an international system,” he said.
Vietnam has been serious about implementing commitments by improving the regulatory climate to make its laws conform more to international practices and to WTO regulations. The country has revised about 30 laws and ordinances.
“The government has proven its constructive economic course in the past. We are convinced that this course will be continued and build a strong foundation for future investment and success,” said Metro Group vice president Henry O.E. Birr.
Last year, Vietnam recorded $20.3 billion in FDI, a 69.1 per cent increase against 2006.
Ashok Sud, European Chamber of Commerce executive committee member, said it was an astounding figure that had far exceeded domestic and foreign commentators’ expectations.
Deputy Prime Minister Pham Gia Khiem said WTO accession created more of a driving force for Vietnam to reform its internal legislative system to come more in line with international practices, creating a favourable and equal business environment for all economic sectors.
Before WTO accession, there was much anxiety and doubt about the Vietnam economy’s adaptability to the tremendous changes in the business environment as well as about its ability to deal with international integration. Khiem said that outside partners had not really believed in Vietnam’s determination to fully and seriously implement its integration commitments.
“Our great achievements in economic development over the past year have wiped out all those concerns and doubts,” he said.
However, World Bank lead economist in Vietnam Martin Rama said that the country had to improve its investment environment, particularly in tackling piracy, copyright infringement and trademark violations. It also needs to strengthen public investment processes and allow the private sector to take part in infrastructure investment, he said.
“Longer-term planning is needed for social infrastructure, such as in education, vocational training and health systems since Vietnam will continue to attract labour intensive industries. But it will also begin to attract the higher-quality investment requiring a higher quality workforce with higher wages,” said Blocker. (Dau Tu Newspaper)
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