With US$64 billion worth of foreign direct investment (FDI) flowing into Vietnam last year, the country will still be an attractive FDI destination for foreign businesses in the future, according to representatives of the UN member economies and leading global economic groups.
Representatives of the UN member economies and leading global economic groups atttended the conference. (Photo: chinhphu.vn)
Foreign delegates shared this view at a conference in Geneva, Switzerland, on February 9, which reviewed Vietnam’s investment policy.
A report drafted by the UN Conference on Trade and Development (UNCTAD) says that Vietnam has undergone an impressive process of transformation from an isolated, poor and collectivised agriculture-based economy into a booming nation with a dynamic and diversified private sector coexisting with a large public sector, fully integrated into the world economy. It highlights that poverty has been reduced at one of the fastest rates in history. With about 60 percent of its population living under the poverty line in 1986, this figure has fallen dramatically to below 20 percent at present.
According to the report, foreign investors have played a major role in these outcomes, generating employment, wealth, diversification and exports. The inflow of FDI into the country has increased significantly, particularly after it joined the World Trade Organisation (WTO) in 2007. Its FDI last year hit a record all-time high of US$64 billion.
Foreign delegates attributed the FDI boom to the country’s Doi Moi (Renewal) process, its shift to the market economy and its international economic integration.
Delegates from Singapore, Japan and France described Vietnam as a leading FDI destination and an important link in the global economic chain. They said that Vietnam has adopted more flexible and effective solutions to ease the global economic slowdown and financial woes than other countries. It also has good medium- and long-term prospects for economic development.
Singaporean Ambassador Tan York Chor said that the Vietnamese Government has issued many radical and pragmatic policies to attract foreign investors. He also noted that Singapore ranks fifth among foreign investors in Vietnam with a total registered capital of US$10 billion and that the country is proud of being Vietnam’s partner.
The negotiator for Economic Partnership Agreements under the Japanese Ministry of Foreign Affairs, Daisaku Sugihara, said that FDI has played an important role in Vietnam’s economic development, poverty reduction, job generation and international economic integration. He added that both Japan and Vietnam are speeding up the implementation of cooperative agreements to boost the flow of FDI into the Southeast Asian nations.
Representatives from leading economic groups such as Holcim, Accor and Nestle also shared the view that Vietnam has great potential for attracting FDI.
To lure more FDI in the future, delegates proposed that Vietnam accelerate its legal and administrative reform relating to land, tax and customs procedures, treat domestic and foreign investors equally, improve the quality of its human resources and enforce intellectual property rights.
Addressing the meeting, Deputy Prime Minister HoÃ ng Trung Háº£i welcomed valuable international assessments of Vietnam’s investment policies.
“The UNCTAD report shares our viewpoint that FDI is the driving force behind economic growth and poverty reduction and that FDI contributions to Vietnam’s development are greater than in any country in the region”, said Mr Hai
“Vietnam still has a lot of potential for luring more foreign capital and is one of the six most attractive economies for foreign investors as defined by the Global Investment Prospect 2007,” said the Deputy PM.
He assured the delegates that the Vietnamese Government will keep reforming policies and improve its investment environment to build on investors’ trust.