30-year FDI attraction: shifting focus onto quality

Leading destinations for the flow of foreign direct investment (FDI) such as Ho Chi Minh City, Dong Nai, Binh Duong and Ba Ria-Vung Tau provinces, have been shifting their focus to investment quality after 30 years attracting foreign capital

The localities now give priority to high-tech projects and those creating high added value without causing environmental pollution.

As the locomotive of the national economy and the core of the southern key economic zone, Ho Chi Minh City is moving towards a dynamic economic structure with greater proportion of high added-value and environmentally-friendly industries.

According to the municipal People’s Committee, the city has set the goal that the FDI sector contributes around VND575.4 trillion, or 20.1% of total social investment in the city during 2018-2020. The city will work to attract FDI into all aspects, thus creating momentum for sustainable and multi-faceted development.

Standing Vice Chairman of the municipal People’s Committee Le Thanh Liem said in the context of the fourth industrial revolution, Ho Chi Minh City will strive to give intention to FDI projects creating jobs for the “smart” workforce.

For the southern coastal province of Ba Ria-Vung Tau, FDI will continue to play an important role in the restructuring of the local economy.

The provincial administration has affirmed the policy of selective investment attraction, with priority given to large-scale projects using modern technology, producing products with high added-value, consuming less energy and causing less environmental pollution.

Ba Ria-Vung Tau hopes to woo 80 new FDI projects with total capital of US$4 billion from now to 2020.

Meanwhile, the southern province of Binh Duong set the goal of attracting at least US$7 billion of FDI during 2016-2020.

In its FDI attraction strategy, the province gives attention to high-quality services and environmentally-friendly industries with high value, while phasing out investment in labour-intensive industries.

The southern province of Dong Nai is orienting the FDI inflow to the support industry, which has so far been a bottleneck in industrial development in the locality. Besides big corporations, the province also encourages small- and medium-sized enterprises to invest in the support industry.

In order to improve the FDI inflow, Deputy Director of the Foreign Investment Agency Dang Xuan Quang advised localities to complete specialised development plans for each socio-economic aspect such as land use, specific industrial sector, and urban areas.

Attention should be paid to the connection among road, waterway and aviation networks and industrial parks, thus creating favourable conditions for enterprises to cut production costs and enhance competitiveness, he said.

Prof. Vo Thanh Thu, senior lecturer at the Ho Chi Minh City Economics University, said each city and province should consider their local development plans in the context of regional plans and increase linkages with other localities in the region.