Hanoi strives to solidify status as strongest capital magnet

08:50 | 20/03/2020 Economy

(VEN) - Hanoi was the biggest attractor of foreign direct investment (FDI) in Vietnam in 2018 and 2019, and the capital is continuing administrative reform to improve its investment environment, and innovate investment, trade and tourism promotion.

hanoi strives to solidify status as strongest capital magnet

Investment growth

According to the Hanoi Statistical Office, in January 2020, Hanoi attracted 68 newly licensed FDI projects totaling US$30.2 million in registered capital, including 61 wholly foreign owned projects and seven joint venture projects. In the same month, seven FDI projects increased their capital by US$71.4 million, and foreign investors bought shares or contributed US$40 million to companies in Vietnam.

According to the Hanoi Department of Planning and Investment, in February, Hanoi attracted 43 newly licensed FDI projects totaling US$22.7 million in registered capital, including 41 wholly foreign owned projects and two joint venture projects, while 10 other FDI projects increased their registered investment capital by US$5.3 million, and foreign investors bought shares worth US$35.7 million in enterprises in Vietnam.

From January 1 to February 19, 2020, Hanoi attracted an additional US$205.3 million in FDI capital, including US$52.9 million of 111 newly licensed projects, US$76.7 million as increased capital of 17 projects, and US$75.7 million worth of shares bought by foreign investors.

Hanoi appeals to foreign investors due to its good infrastructure, including transport infrastructure, industrial parks, and an open, favorable and friendly business environment. The city government meets regularly with foreign investors and is willing to listen to them and help them solve their problems.

Nguyen Manh Quyen, Director of the Hanoi Department of Planning and Investment, said the city government is determined to build an administrative system that favors businesses. The department worked with related authorities in reviewing the land fund and preparing plans for attracting large projects, assisting investors to promptly accomplish investment procedures, aiming to put projects into operation as soon as possible, Quyen said. Hanoi is stimulating on-the-spot investment promotion through meetings and information exchanges with investors, he said.

City authorities have been providing investors in the capital with information that they need while assisting them in overcoming difficulties, solving problems, expanding businesses, and increasing invested capital. Hanoi is continuing administrative reform and information technology (IT) applications in public service provision, and ensures all investment registration procedures are implemented online. The city is integrating utility services for businesses.

Prioritized fields

However, businesses say a number of administrative procedures remain complicated, the execution of laws not sufficiently transparent and needs to be improved, and air pollution, water pollution and traffic congestion still exist. Easing these problems will help Hanoi lure more investors.

Hanoi People’s Committee Chairman Nguyen Duc Chung said Hanoi has identified urban technical infrastructure development, production and processing, new technology application, automation, and services as priority sectors for investment attraction, aiming to join the global value chain, improve city people’s living standards and make use of the capital’s advantages.

The city will improve its investment attraction policies to attract large-scale, high-value-added projects that use modern, environmentally friendly technologies, and assist investors to expand production and trading activities. Hanoi will attract public-private partnership (PPP) and other projects to develop infrastructure, urban services and social welfare, while giving priority to green growth, development of green parks, recreation areas and housing for the poor and people benefiting from state preferential policies, renovating old condominiums and rural clean water.

Hanoi considers the business community in general and the foreign invested enterprise community in particular an important driving force for the capital’s development. The city will continue to improve its business environment and Provincial Competitiveness Index (PCI), review and simplify administrative procedures to maximize investor comfort and help businesses minimize costs.

Hanoi will need about VND3,000 trillion for development investment by 2025. Since the capital’s coffers can only meet about 20 percent of the demand, it is crucial for Hanoi to stimulate investment and continue administrative reform to attract investment capital.

Hanoi set targets of strengthening the attraction of investment from Japan, the Republic of Korea (RoK), the US and Europe, and leading global corporations.

Nguyen Hanh