Measures sought to make HCM City more attractive to foreign investors

Illustrative image (Source: vneconomy)

Experts and economists gathered at a seminar in Ho Chi Minh City on May 12 to discuss measures to help the southern largest economic hub enhance its attractiveness to foreign investors amid its standstill situation in drawing foreign direct investment (FDI).

Mai Phong Lan, an official from the municipal Department of Planning and Investment, said that last year, the city drew only 4.33 billion USD in FDI, equivalent to 60.29% of the figure in 2021.

So far, the city has hosted 11,220 FDI projects worth 56 billion USD, she said, underlining the FDI projects' positive impacts on the economic transformation of the city as well as the development of many sectors and human resources training.

However, Lan said that FDI has still focused on particular districts and sectors with limited influences in the improvement of technologies and supply chains for domestic businesses.

Along with increasing the number and values of FDI projects, the city aims to raise the ratio of registered capital in total FDI in the city by over 70% in the 2023-2025 period and 75% in the 2026-2030 period.

In the short and middle terms, HCM City will prioritise projects in areas of digital economy, microelectronics, semiconductor and information technology, automation, precision mechanics, new materials, pharmaceuticals, biological industry, high-tech agriculture, environmental technology and clean energy.

At the same time, it will step up the attraction of FDI in research, innovation, and start-up, while paying greater attention to expanding its infrastructure and high-quality services, the official said.

Ngo Nghi Cuong, CEO of C Consult, held that the city, which used to be the strongest FDI magnet, has experienced a downturn in attractiveness.

Cuong clarified that in the first four months of this year, the city saw a fall in both FDI project number and value. He advised the city to re-define its strengths in the new period where investors are not merely interested in benefits but also the investment environment, supply capacity, and the living conditions for investors and experts.

Pham Phu Truong, Presisent of the Young Businesspeople Association of HCM City (YBA-HCM), said that despite its strategic location, HCM City has faced many disadvantages such as regular flooding, traffic jams, and air pollution, making it less attractive to investors and experts.

He held that the city should re-evaluate potential investors that it wants to draw, especially strategic investors.

Meanwhile, Cao Thi Phi Van, Vice Director of the HCM City Centre for Trade and Investment Promotion, said that in the past, tax policy played the key role in attracting investment and was an advantage of the city.

However, with the implementation of the global minimum tax regulations, that advantage no longer exists, she said, adding that investors today need a transparent business and investment environment, clear and stable policies, high quality human resources and smooth technical infrastructure, to which the city should pay greater attention./.