KTFA: Vietnam News
Toyvp: Curb inflation
December, 21/2022 – 08:23
Inflation has risen rapidly in many parts of the world. Though Việt Nam has a lower rate of inflation compared to most of its neighbours, businesses here are struggling with the rising costs of goods and products.
The government has issued a number of fiscal and monetary policies to curb inflation as it set the target to maintain the consumer price index at under 4 per cent this year.
Henig: Screening proposed for improved foreign investment
06:00 | 21/12/2022
(VEN) – Foreign direct investment (FDI) has contributed significantly to the Vietnamese economy since the Law on Foreign Investment in Vietnam was promulgated in 1987. However, Vietnam is mulling effective screening tools to enhance FDI quality.
According to the Vietnam Chamber of Commerce and Industry (VCCI), Vietnam has attracted FDI for 35 years and become an attractive destination to foreign investors. In 1991, US$1.28 billion of foreign investment was registered in Vietnam, of which US$428.5 million was disbursed. In 2021, the registered and disbursed amounts increased respectively by 30 times and 38 times compared with 1991, despite the heavy impacts of the COVID-19 pandemic.
Foreign invested companies have contributed significantly to employment generation, international trade promotion, sector and value chain linkages, helping increase labor productivity. The FDI sector contributes about 72 percent to Vietnam’s total export value.
Despite these positive contributions, according to Dau Anh Tuan, Head of VCCI’s Legislation Department, certain problems have arisen with FDI projects. Tax authorities, for example, have reported the involvement of some FDI companies in transfer pricing and tax evasion.
Some companies have failed to adhere to environmental laws and regulations. The results of inspections conducted by the Vietnam Environment Administration in 28 northern provinces from 2017 to 2019 show an increased percentage of FDI companies violating environmental regulations, from 44.5 percent in 2017 to 56 percent in 2018 and 68 percent in 2019.
Moreover, according to a VCCI study, only five percent of FDI projects use high technology, 80 percent use medium technology, and 14 percent use low technology. The local content of products ranges from 20-25 percent, lower compared with other countries in the region.
Institutional and policy improvements
Given the FDI sector’s problems, economists are considering how to attract quality investors with responsible business orientations.
Politburo Resolution 50-NQ/TW dated August 20, 2019 on institutional and policy improvements for better quality and higher effectiveness of foreign investment pointed out these limitations of the FDI sector. The resolution highlighted the need to carefully select projects based on quality, technology level and environmental impact. The resolution called for prioritizing projects using advanced and clean technology, creating high added value and connecting Vietnamese businesses to global production and supply chains.
According to Ramla Khalidi, the United Nations Development Program (UNDP) representative in Vietnam, other countries apply various criteria in licensing foreign investment. The EU, for example, applies a code related to the environment and humans; Japan is assessing the enforcement of human rights in businesses; the US forbids imports from enterprises involved in labor exploitation.
VCCI and UNDP recently introduced a set of tools for screening FDI projects in Vietnam. The tools include assessment of investment based on factors such as employment generation, technology transfer, infrastructure development, linkages with local businesses, labor, and environmental impact. The screening tools are expected to help improve the quality and effectiveness of FDI in Vietnam.
VCCI and UNDP are cooperating to create a set of screening tools to help Vietnamese localities select quality FDI projects.
Nguyen Hoa LINK
Henig: Bà Rịa-Vũng Tàu investing in infrastructure to attract investors
The southern province of Bà Rịa-Vũng Tàu is building infrastructure in its industrial parks and ports to attract investors.
BÀ RỊA – VŨNG TÀU— The southern province of Bà Rịa-Vũng Tàu is building infrastructure in its industrial parks and ports to attract investors.
Calling for investment in ports is one of the five sectors that Bà Rịa-Vũng Tàu is focusing on to achieve its target to become one of the three provinces attracting the highest foreign direct investment in this period.
Developing infrastructure is an indispensable trend the southern province is following to achieve the goal of comprehensive development, its people’s committee has said.
In recent years it has invested a lot of money in upgrading and expanding roads, logistics centres and ports.
This reduces the time it takes and makes it easier for investors and local people to reach neighbouring cities and provinces like HCM City, Bình Dương and Đồng Nai by sea and road, the people’s committee said.
Investment has also been made to upgrade intra-province transportation between industrial zones, ports and logistic centres, it said, adding that upgrades to infrastructure and transportation would continue until 2030.
As the southern gateway of the country, the province’s network of deep-sea ports plays an important role in its commercial service and industry development, as well as import and export activities, which is why upgrading ports and logistics centres remains a top priority for the province.
It has worked hard to improve infrastructure, many of which directly affect the province’s infrastructure and economy from now to 2025. These improvements will in turn enhance the province’s ability to draw domestic and foreign investments.
These include investment in the Biên Hòa – Vũng Tàu railway for transporting goods that will connect the Cái Mép – Thị Vải seaport, expansion of Côn Đảo Airport and developing large industrial complexes for industry and services in Phú Mỹ New City.
The province will also draw up strategies to attract efficient investors to Cái Mép Hạ Free Trade Zone, with a focus on key industries such as technology, ports and logistics, tourism, digital economy, and finance.
The government’s action plan targets strengthening linkages between industrial parks and export processing zones in the southeastern region, developing the region into a financial, commercial, services, and international trade hub in Southeast Asia.
It also aims to develop Bà Rịa –Vũng Tàu into a maritime hub.
Besides port infrastructure, the province also plans to build a VNĐ850 billion (US$34 million) road through the centre of Vũng Tàu City.
Once completed, the 1.83km road will boost local tourism.
With financial assistance from the government, Bà Rịa-Vũng Tàu is also building a 53.7km stretch of the Biên Hòa-Vũng Tàu Expressway at a cost of VNĐ17.8 trillion ($712 million).
It will contribute VNĐ670 billion, or half the expected land costs.
It has cancelled 21 projects and postponed 27 others to allocate nearly VNĐ10 trillion for transport infrastructure.
Bà Rịa-Vũng Tàu has for long been an ideal destination for investment thanks to its location: it is only around 100km from HCM City.
It has a network of modern highways and inner roads that conveniently connect it with other provinces in the region as well as with ports and industrial zones.
It is now focusing on developing services, ports, trade, tourism, and high-tech agriculture.
It has become an energy, heavy industry, port, and tourism hub of the country with the Phú Mỹ Thermal Power Plant and Bà Rịa Power Plant, which account for 40 per cent of the country’s total power capacity.
It has around 50 ports with a total capacity to handle 150 million tonnes a year.
Cái Mép International Terminal is able to berth vessels of up to 250,000 tonnes. From this port, they can sail to Europe and America. Cái Mép Port Cluster is among the 19 large ports around the globe that can receive the world’s currently largest container ships.
The province currently has 447 foreign-invested projects worth a total of $30 billion. — VNS LINK