06:17 | 20/06/2020 Economy
Đỗ Nhất Hoàng, director-general of the Foreign Investment Agency under the Ministry of Planning and Investment, spoke to Vietnam News Agency on the factors that make Vietnam an attractive place for foreign investors
|Đỗ Nhất Hoàng. — Photo MPI|
The COVID-19 pandemic has seriously impacted the world economy, including Vietnam.
However, with efforts made by Vietnamese enterprises coupled with the timely support from the Government, ministries and local authorities nationwide, Vietnamese enterprises, including FDI enterprises, have overcome challenges to keep their production on course.
In the first five months of 2020, total foreign investment in the country was reported at US$13.8 billion, down about 17 per cent compared with the same period last year. Meanwhile, in the first five months of 2020, foreign direct investment in Vietnam was at about $6.7 billion, a drop of about 8.2 per cent compared with the same period last year.
However, compared with other countries, such a drop was acceptable. In the same period under review, new total capital registration scored an increase of 32 per cent while the amount of capital registration of enterprises saw an increase of 12 percent. These figures are a solid foundation showing Vietnam has remained an attractive and safe place for enterprises to invest in.
I also believe that when Vietnam decides to resume international flights more foreign investors will return to the country.
It is reported that there is a tendency to divert foreign investment into India and other ASEAN nations post-COVID-19. Do you have any comment on that?
It is high time for Vietnam to talk about the investment restructuring of enterprises. In the past many years, foreign economic groups have restructured their investment to maximise the effectiveness of their investment.
About 7-8 years ago, many foreign economic groups started to restructure their investment. At that time we already heard about their strategy China+1 and Thailand+1. Vietnam then started to negotiate for the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). As a result, a flow of investment capital was switched to Vietnam.
Adding to that the trade war between international major economies became a driving force for pushing world economic restructuring to avoid high commercial tariffs levied by the US.
And now, the COVID-19 has seriously impacted the global supply chain on all economic groups, regardless of nationality. This has opened up an opportunity for many countries, including Việt Nam.
What do you think about the advantages Vietnam has enjoyed in that trade war compared with other ASEAN countries?
In the ASEAN bloc, Vietnam has been an attractive investment place for many investors. Many investors have said Việt Nam is a country with a stable political system with fast and sustainable economic development for many years and with abundant human resources with a big market and many more advantages compared to other countries. What’s more important, Vietnam is located in a strategic position in the centre of Southeast Asia.
Another important point is that Vietnam has a good investment environment and at the recent sitting of the National Assembly, quite a few laws, including the revised Investment Law, the revised Enterprises Law and the Law on Public and Private Investment, were discussed and adopted. When these laws come into force, Vietnam will become a more attractive destination for many foreign investors.
What measures should Vietnam adopt to attract more foreign investors?
It's time for Vietnamese enterprises to restructure to attract more foreign investors to Vietnam, particularly by training workers with high skills and the country’s investment policies.
The Ministry of Planning and Investment has proposed three groups of measures to attract more foreign investment.
First, there are solutions relating to foreign investment promotion
Second, policies to attract foreign investment with good screening, particularly projects with high added value and posing big impacts on the country’s socio-economic development.
Finally, to revise the current Investment Law and related laws to attract more foreign investors.
Don’t you think the recent ratification of the European Union Vietnam Free Trade Agreement and the European-Vietnam Investment Protection Agreement will become a driving force to attract more foreign investors into Vietnam?
At present, investment from EU countries into Việt Nam is about $25 billion. Though the figure is not really high, the potential for future economic development is big.
We are confident the special priorities from both the EVFTA and EVIPA and Vietnam’s commitment to reform its investment environment will open up a new page for European investors to come to Vietnam.