Lifting barriers to attract foreign investors

VCN - As one of the leading localities in attracting foreign direct investment (FDI), procedures as well as the legal framework governing business investment activities in Ho Chi Minh City reveal a lot of shortcomings, making the Government's preferential policies, which are very attractive, still difficult to attract potential capital.
Prime Minister to chair meeting with foreign investors Prime Minister to chair meeting with foreign investors
Measures sought to make HCM City more attractive to foreign investors Measures sought to make HCM City more attractive to foreign investors
Many foreign investors interested in M&A deals in real estate market: VAR Many foreign investors interested in M&A deals in real estate market: VAR
Ho Chi Minh City is an attractive destination for FDI investors.  Photo provided by the enterprise
Ho Chi Minh City is an attractive destination for FDI investors. Photo provided by the enterprise

Positive signals

Due to the global economic chaos, global businesses are more cautious in their investment decisions. However, many investors still believe and make decisions to expand or invest in new projects in Vietnam in general and Ho Chi Minh City in particular. As a result, in the first 6 months of 2023, FDI "poured" into Ho Chi Minh City reached 2.8 billion USD, up 30.7% over the same period. FDI capital into Ho Chi Minh City "boomed" in the first 6 months of the year showing the vitality of Ho Chi Minh City's economy in the second quarter after falling deeply in the first quarter of 2023, which is a good sign in the context of increasing competition in attracting FDI among countries.

Deputy Director of Ho Chi Minh City Department of Planning and Investment Dao Minh Chanh said that Vietnam is a destination for investors in the world, a bright spot to attract investment in the region in recent years, of which Ho Chi Minh City ranked first in the search list. Up to now, Ho Chi Minh City has 11,868 valid foreign investment projects, with a total investment capital of both new and increased capital of more than 81.29 billion USD, leading in the number of domestic valid projects.

To promote FDI attraction in the coming time, Ho Chi Minh City is implementing a project to improve the efficiency of attracting foreign direct capital in the area for the period of 2023 - 2025, with a vision of 2030. Accordingly, in the short and medium term, Ho Chi Minh City prioritizes attracting digital economy and technology 4.0-based industries, microelectronics, semiconductors, and information technology. Moreover, outdated technology, energy consumption, and environmentally threatening ones are all eliminated. At the same time, the city also applies selective foreign investment criteria

However, according to experts, currently, there exist some barriers such as unfavorable administrative procedures, and inadequate state management of FDI. Moreover, incentives to attract FDI are not attractive enough, infrastructure is not synchronized, and legal regulations are overlapping. In addition, traffic jams, flooding, high tides, pollution... make investors hesitate. The number of enterprises participating in the supply chain is not much (service industry, equipment, indirect materials); domestic production value is not high; research and development (R&D) activities have not been implemented, no R&D team has been established in the factory...

Remove “barriers” to regain the advantage

Acknowledging the "barriers" in attracting FDI to Ho Chi Minh City, many businesses said that despite the recent improvement in the investment environment, there are many shortcomings in terms of procedures as well as the regulatory framework which hinder the investment intentions in spite of the Government's preferential policies

Sharing with reporters on the sidelines of the conference "Strengthening investment attraction and proposing effective legal solutions for investors in Ho Chi Minh City" that took place recently, Mr. Vu Tu Thanh, Deputy Director of ASEAN Region, Association The US-ASEAN Business Council said that US investors in Vietnam in general and Ho Chi Minh City, in particular, have to face many legal risks. The first is how to understand and interpret legal documents. In fact, many investors decided to make an investment decision based on the consultation and explanations of a central ministry or branch, but due to unpredictable changes, the interests of the investor are not guaranteed. The second risk is regulations on land access, tax regulations, and even regulations on dispute settlement between enterprises and between enterprises and management agencies.

Mr. Dau Anh Tuan, Deputy General Secretary, Head of the Legal Department of the Vietnam Confederation of Commerce and Industry (VCCI), said that the biggest advantage in attracting investment in Vietnam and Ho Chi Minh City was the low cost, including tax incentives. However, now, these factors have changed and this advantage no longer existed. In addition, the legal framework regulating business investment activities reveals many shortcomings, making the Government's preferential policies, which are very attractive, still difficult to attract potential capital sources.

Ms. Cao Thi Phi Van, Deputy Director of the Investment and Trade Promotion Center of Ho Chi Minh City (ITPC), said that if tax incentives are not taken into account, the remaining problem in attracting FDI in Ho Chi Minh City is to focus on improving improve the investment environment. Therefore, Ho Chi Minh City needs to have a strategic and long-term policy so that traditional investors can feel secure to expand their scale, and at the same time create attraction for new investors. And one of the key goals that need attention in the coming time is to propose effective legal solutions for investors in the City, in order to create a healthy and clean legal environment so that foreign investors can be assured of stable investment and long-term business.

Vu Tien Loc, Chairman of the Vietnam International Arbitration Center (VIAC), suggested that Ho Chi Minh City should focus on a number of key points such as institutions, infrastructure, and human resources. In particular, it is of urgent need to identify and implement appropriate legal solutions, and timely improve policy issues in attracting investment and operating FDI projects.

Thu Diu/Thu Phuong

Related News

Local State Treasuries focus on effective control of public budget

Local State Treasuries focus on effective control of public budget

VCN - From the early year 2024, the State Treasury has task of managing the State fund to ensure strictness and safety. This is also the key task determined by the local customs departments.
Securities attractive investment channel

Securities attractive investment channel

VCN - According to experts, with recent developments in the stock market, it can be seen that securities are currently an attractive investment channel.
Efforts to remove obstacles to upgrade the stock market

Efforts to remove obstacles to upgrade the stock market

VCN - According to the sharing of Ms. Vu Thi Chan Phuong, Chairwoman of the State Securities Commission (SSC), in addition to completing the main criteria of international rating organizations in upgrading the stock market (TTCK), the State Securities Commission (SSC) continues to improve domestic regulations on the basis of researching international regulations and practices to promote Vietnam's stock market to develop in a sustainable direction, creating a favorable environment to attract international investors and foreign indirect investment capital flows.
Binh Duong Customs Department accompanies and supports businesses to comply with the law

Binh Duong Customs Department accompanies and supports businesses to comply with the law

VCN - Thanks to many practical solutions, the pilot program to support and encourage businesses to voluntarily comply with customs laws at Binh Duong Customs Department is increasingly effective, highly recognized and evaluated by the business community

Latest News

Big opportunities for rice exports in 2024

Big opportunities for rice exports in 2024

Positive prospects are forecast for Vietnam’s rice export in 2024, with bright signs in both market and price.
Vietnam-Australia trade ties expected to grow further

Vietnam-Australia trade ties expected to grow further

Vietnamese Prime Minister Pham Minh Chinh’s official visit to Australia is expected to create new momentum for the bilateral relations, including their trade ties.
Many opportunities to develop the semiconductor industry in the Southeast region

Many opportunities to develop the semiconductor industry in the Southeast region

VCN - According to foreign investors, Vietnam is a particularly attractive market for the cooperation and development of the semiconductor industry. In particular, the Southeast region of Vietnam has a lot of potential to develop the semiconductor chip industry.
Many real estate businesses face difficulties of cash flow

Many real estate businesses face difficulties of cash flow

VCN - Although many policies to overcome difficulties have been put forward by the Government, ministries and branches but many real estate businesses face the situation of being "thirsty for money". Finding solutions to unlock capital sources for the real estate market to promote recovery and development is essential.

More News

Deep processing increases agricultural product export value: experts

Deep processing increases agricultural product export value: experts

The current proportion of processed pepper products for export stands at a mere 30%, indicating the need for a significant improvement.
Shipping companies are currently charging about ten types of surcharges for goods at seaports

Shipping companies are currently charging about ten types of surcharges for goods at seaports

VCN - The Vietnam Ship Agents, Brokers, and Maritime Services Providers Association (Visaba) has recently expressed concerns that a series of fees and surcharges are unilaterally determined by foreign shipping lines without agreement with customers.
Enterprises expect to "take off" in 2024

Enterprises expect to "take off" in 2024

VCN - After a period of sluggish business, even continuous decline, many companies have seen optimistic signals in 2024 and have outlined bold plans to quickly return to a growth trajectory.
Electronic products are the driving force for export growth

Electronic products are the driving force for export growth

VCN - The export growth momentum in early 2024 is assessed to have a major contribution from all types of phones and components.
Answering many questions for Korean businesses at 2024 tax and customs policy dialogue conference

Answering many questions for Korean businesses at 2024 tax and customs policy dialogue conference

VCN - At the Dialogue Conference with Korean businesses on tax and customs policies and administrative procedures in 2023-2024 organized by the Ministry of Finance on the afternoon of February 29, representatives of leaders of units under the Ministry Finance, General Department of Taxation, and General Department of Customs directly answered in detail questions of Korean businesses related to the field of tax and customs.
Reconfigure the global cashew supply chain to prevent disruptions

Reconfigure the global cashew supply chain to prevent disruptions

VCN - On February 27th, the 13th Vietnam International Cashew Conference officially opened in Dong Hoi City, Quang Binh Province. This event was part of Vietnam's National trade promotion program, organized in collaboration with the Vietnam Cashew Association (VINACAS) and the Ministry of Industry and Trade of Vietnam.
Durian emerging as "golden fruit" among Vietnam"s exports

Durian emerging as "golden fruit" among Vietnam"s exports

Vietnam is striving to further assert its durian export position and join the billion-dollar export industry with the current advantages in hand, coupled with efforts to better the fruit quality. The country is working hard to tap the potential and expand global reach for the sector.
Impression of exports at the beginning of the year

Impression of exports at the beginning of the year

VCN - In early 2024, our country's export activities prospered. Statistical data of the General Department of Customs records many impressive numbers, especially from key industries, markets and localities with billion-dollar growth figures.
Packaging among sectors with highest growth in Vietnam: insiders

Packaging among sectors with highest growth in Vietnam: insiders

The packaging industry, which is projected to expand 15-20% in the next few years, is among sectors posting highest growth rate in the country, experts said at a press conference held in Ho Chi Minh City on February 29 to introduce the 17th International Processing and Packaging Exhibition and Conference for Vietnam (ProPak Vietnam 2024.)
Read More

Your care

Latest Most read
Big opportunities for rice exports in 2024

Big opportunities for rice exports in 2024

Positive prospects are forecast for Vietnam’s rice export in 2024, with bright signs in both market and price.
Vietnam-Australia trade ties expected to grow further

Vietnam-Australia trade ties expected to grow further

Vietnamese Prime Minister Pham Minh Chinh’s official visit to Australia is expected to create new momentum for the bilateral relations, including their trade ties.
Many opportunities to develop the semiconductor industry in the Southeast region

Many opportunities to develop the semiconductor industry in the Southeast region

According to foreign investors, Vietnam is a particularly attractive market for the cooperation and development of the semiconductor industry.
Many real estate businesses face difficulties of cash flow

Many real estate businesses face difficulties of cash flow

VCN - Although many policies to overcome difficulties have been put forward by the Government, ministries and branches but many real estate businesses face the situation of being "thirsty for money". Finding solutions to unlock capital sources for the rea
Deep processing increases agricultural product export value: experts

Deep processing increases agricultural product export value: experts

The current proportion of processed pepper products for export stands at a mere 30%, indicating the need for a significant improvement.
Mobile Version