Quang Ninh's special zone calls for investment in five projects

Quang Ninh's special zone calls for investment in five projects

  January 02, 2018

Vietnam`s north-eastern province of Quang Ninh is calling for an investment of 15 trillion VND (660.8 million USD) in five projects in the Van Don special administrative-economic zone.

The projects, in the Van Don special administrative-economic zone, include the Phuong Hoang Island resort with an estimated capital of 5.5 trillion VND on an area of 691ha, Nat Dat Island tourism complex with an investment of 3.15 trillion VND, Cai Bau Island Resort, Hotel and Golf Course complex with 3.5 trillion VND, Hon Soi Nhu Island Resort complex with 637 billion VND and Hon Chin tourism complex with 2.5 trillion VND.

According to the provincial Department of Tourism and Economic Zone management board, many foreign investors have plans to invest into big projects in the province.

In its development plan, Quang Ninh has called for investments into 14 big-scale property and resort projects in the 2016-20 period, as well as others to develop four key tourism centres, including Ha Long, Mong Cai - Tra Co, Van Don- Co To and Uong Bi – Dong Trieu - Quang Yen.

The province has given priority to two projects, which could help promote tourism, including Van Don International Airport and a resort complex with a casino.

The Economic Zone management board said many large projects with an investment of several billions of dollars from the United States, China and Thailand have been implemented in the province. Quang Ninh submitted a proposal to the government to offer preferences in terms of the business environment at the Van Don special administrative-economic zone.

Accordingly, the zone would have mechanisms to reduce the number of business lines with conditions and to remove the limits in investment conditions for foreign investors in sectors that the province prioritises for development.

The municipal Department of Planning and Investment said that by the end of this year, the province will have 2,240 newly-established firms, with a total registered capital of 12.9 trillion VND, posting 32 percent and 9.3 percent increases in terms of capital, respectively.

In addition, some 500 businesses resumed their operations this year, increasing 44 per cent from the previous year. The total number of operating companies in the province was 14,900, with a total registered capital of 148 trillion VND.

The department said it has taken drastic measures to untie businesses’ difficulties to expand their production and trading. Earlier, Prime Minister Nguyen Xuan Phuc had given the northern province of Quang Ninh the go-ahead to develop the Van Don Economic Zone as a special administrative-economic unit.

Van Don district comprises over 600 islands and is located around 175km from Hanoi, 80km from Hai Phòng city and 50km from Ha Long city. The district encompasses the World Heritage site, Ha Long Bay. It covers a total area of 2,171sq.m, of which natural land is 551sq.m.

The district is sparsely populated and its total population is 41,645 people. With the variety and uniqueness of the archipelago, rich ecosystems and beautiful beaches, the islands have the potential to become a world-class maritime tourism destination.

(Source: hanoitimes.com.vn)

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FDI in Vietnam soars to record-setting $35.88 billion in 2017

FDI in Vietnam soars to record-setting $35.88 billion in 2017

  January 02, 2018

Vietnam has remained an attractive destination for foreign investors in 2017 as they registered to invest a record high of US$35.88 billion in the country, up 44.4 per cent against last year.

Reports from the Foreign Investment Agency under the Ministry of Planning and Investment showed that of the sum, $21.27 billion came from 2,591 new projects, up 42.3 per cent against last year.

Another $8.41 billion was added to 1,188 existing projects, 49.2 per cent higher last year.

The remainder of the FDI, worth $6.19 billion, came from 5,002 deals made by foreign investors to contribute capital to businesses and to buy shares of Vietnamese businesses, jumping 45.1 per cent compared with last year.

The electricity sector attracted US$8.37 billion of FDI capital in 2017.

In 2017, FDI disbursement also saw a record-setting as it increased of 10.8 per cent to $17.5 billion. In the previous years, the capital influx reached only some $11-12 billion.

Among 19 industries and sectors attracting FDI capital in 2017, manufacturing and processing industries remained the top sector, receiving $15.87 billion, accounting for 44.2 per cent of the total registered FDI.

The electricity production and distribution sector ranked second with $8.37 billion, representing 23.3 per cent of the total FDI. The real estate sector was in third place with $3.05 billion, totaling 8.5 per cent.

Among 115 countries and territories investing to Vietnam this year, Japan topped the list with $9.11 billion, making up 25.4 per cent of the FDI pledged to the country. It was followed by South Korea with $8.49 billion, or 23.7 per cent of the FDI, and Singapore with $5.3 billion, or 14.8 per cent.

The southern economic hub of Ho Chi Minh City was at the top among 59 localities receiving FDI during the year, followed by the northern province of Bac Ninh and the central province of Thanh Hoa.

Some mega projects in 2017 were three BOT thermal power projects. They were Japan’s $2.8-billion Nghi Son 2 thermal power plant in the central province of Thanh Hoa, Japan’s $2.58-billion Van Phong 1 thermal power plant in the central province of Khanh Hoa and Singapore’s $2.07-billion Nam Dinh 1 thermal power plant in the northern province of Thai Binh.

Large projects in other indutries included South Korea’s $2.5 billion Samsung expansion project in the northern province of Bac Ninh; the $1.27-billion Block B O Mon gas pipeline project in the Mekong Delta province of Kien Giang of a joint venture among Viet Nam Oil & Gas Group (PVN), PetroVietnam Gas Corporation (PV Gas), Japan’s Mitsui Oil Exploration Co., Ltd (MOECO) and Thailand’s PTT Exploration and Production Public Company Ltd; and South Korea’s $885.85 million smart complex project in Ho Chi Minh City's Thu Thiem New Urban Area. 

To fully capitalise on the FDI capital source in the new stage, the Ministry of Planning and Investment is drafting the foreign direct investment strategy for 2018-2023. With the assistance from the World Bank, the FDI strategy drafts that Vietnam at this stage should focus on sectors having advantages, and those that foreign firms could bring more benefits to, rather than domestic firms.

Under the draft strategy, Vietnam should set out priority sectors for attracting FDI, such as those that needs increased value and competitiveness, including manufacturing (high-grade metals/minerals/chemicals/plastics and high-tech/electronic components); service (logistics and maintenance, repair and overhaul - MRO); agriculture (innovative agricultural products, high value such as rice, coffee, seafood); and travel (high-value tourism services).

(Source: hanoitimes.com.vn)

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Vietnam remains an attractive destination for foreign investors

Vietnam remains an attractive destination for foreign investors

  December 28, 2017

Vietnam has remained an attractive destination for foreign investors in 2017 with total FDI capital registered in the country hitting a record high of 35.88 billion USD, up 44.4 percent against last year.

Reports from the Foreign Investment Agency under the Ministry of Planning and Investment showed that of the sum, 21.27 billion USD came from 2,591 new projects, up 42.3 percent against last year.

Another 8.41 billion USD was added to 1,188 existing projects, 49.2 percent higher than last year. The remainder of the FDI, worth 6.19 billion USD, came from 5,002 deals made by foreign investors to contribute capital to businesses and to buy shares of Vietnamese businesses, jumping 45.1 percent compared to last year.

In 2017, FDI disbursement also saw a record setting, as it increased 10.8 percent to 17.5 billion USD. In the previous years, the capital influx reached only some 11-12 billion USD. Among 19 industries and sectors attracting FDI capital in 2017, the manufacturing-processing industry remained the top sector, receiving 15.87 billion USD, accounting for 44.2 percent of the total registered FDI.

The electricity production and distribution sector ranked second with 8.37 billion USD, representing 23.3 percent of the total FDI. The real estate sector was in third place with 3.05 billion USD, totalling 8.5 percent. Among 115 countries and territories investing in Vietnam this year, Japan topped the list, with 9.11 billion USD, making up 25.4 percent of the FDI pledged to the country. It was followed by South Korea with 8.49 billion USD or 23.7 percent of the FDI, and Singapore with 5.3 billion USD or 14.8 percent.

The southern economic hub of HCM City was at the top, among 59 localities receiving FDI during the year, followed by the northern province of Bac Ninh and the central province of Thanh Hoa. Among some of the mega projects in 2017 were three BOT thermal power projects. They were Japan’s 2.8 billion USD Nghi Son 2 thermal power plant in the central province of Thanh Hoa, Japan’s 2.58 billion USD Van Phong 1 thermal power plant in the central province of Khanh Hoa and Singapore’s 2.07 billion USD Nam Dinh 1 thermal power plant in the northern province of Thai Binh.

Large projects in other industries included the Republic of Korea’s 2.5 billion USD Samsung expansion project in the northern province of Bac Ninh, the 1.27-billion USD Block B O Mon gas pipeline project in the Mekong Delta province of Kien Giang and the Republic of Korea’s 885.85 million USD smart complex project in HCM City’s Thu Thiem New Urban Area. 

To fully capitalise on the FDI capital source in the new stage, the Ministry of Planning and Investment is drafting the foreign direct investment strategy for 2018-23. With assistance from the World Bank, the FDI strategy drafts that Vietnam at this stage should focus on sectors having advantages, and those that foreign firms could bring more benefits to, rather than domestic firms. 

Under the draft strategy, Vietnam should set out priority sectors for attracting FDI, such as those that needs increased value and competitiveness, including manufacturing (high-grade metals/minerals/chemicals/plastics and high-tech/electronic components); service (logistics and maintenance, repair and overhaul); agriculture (innovative and high value agricultural products such as rice, coffee, seafood, fruits); and travel (high-value tourism services).

(Source: vir.com.vn)

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South Korea tops foreign investment in Vietnam 2017

South Korea tops foreign investment in Vietnam 2017

  December 28, 2017

South Korea’s investment capital in Vietnam now increases to some US$60 billion, 120 times higher than that in 1992.

Nguyen Van Toan, Vice Chairman of the Vietnam Association of Foreign Investment Enterprises, said at a forum on reviewing 25 years of Vietnam and South Korea’s economic ties held recently that South Korean firms have invested US$8 billion each year in Vietnam in the past four years.

The investment capital flow in the 11 months of this year hit US$8 billion, making South Korea become the top investor in Vietnam, Toan said.

Samsung R&D center in Hanoi.

South Korea’s foreign direct investment (FDI) in Vietnam has occurred in three waves. The first wave occurred after the lifting of the US embargo, which focused on labor-intensive sectors such as textiles and garments, followed by Vietnam ascension to the WTO wherein investors focused on the manufacturing of electronic goods. The third wave currently focuses on manufacturing as well as consumer goods, retail, and services.

Around 12.5 percent of the total FDI was invested in Bac Ninh province, followed by Dong Nai province, and Hai Phong at 10.8 percent and 10.6 percent respectively. Hanoi accounted for 10.5 percent of the total FDI.

Some 5,000 South Korean companies have invested in Vietnam in the last 25 years. According to the Vietnam Chamber of Commerce and Industry, Korean-invested firms in Vietnam in 2016 contributed almost a third of Vietnam’s exports and provided around 700,000 jobs domestically.

Manufacturing accounts for 70 percent of the cumulative South Korean investments since 1988, followed by real estate management and construction sector at 14.8 percent and 5.4 percent respectively.

Apart from manufacturing, which accounted for 82.3 percent of investments in 2016, there has been a growing interest by South Korean companies in the services and distribution sectors along with, wholesale and retail, culture, and science and technology. In addition, 2017 has seen a considerable interest in the food and finance & banking sectors.

South Korean firms are also looking to increase their investments in the agriculture, forestry, and fishery sectors, taking advantage of the preferential tariffs of Vietnam-Korea Free Trade Agreement.

Samsung leads the pack amongst South Korean investors in Vietnam. It manufactures almost half of its smartphones at its two factories in Vietnam. Samsung is also setting up a third complex focusing on home appliances and displays with an investment of US$2.5 billion.

LG, another electronic giant also has set up a production hub in Vietnam to manufacture smartphones and televisions. The company will be spending around US$1.5 billion in the new hub by 2028.

Seoul Semiconductor Company also won a license to build a new $300 million semiconductor, while LED manufacturer Lumens will begin manufacturing operations later this year.

CJ Group, a South Korean conglomerate is also in the midst of a large-scale expansion in Vietnam. Its business interest ranges from food processing, fertilizer and feed production, TV shopping, film production, and distribution. In 2016, it invested US$500 million into new projects and M&A.

Another conglomerate, Lotte Group plans to expand its retail operations five-fold to 60 shopping malls in Vietnam by 2020.

Besides expanding investment in Vietnam, South Korean investors have also brought high technologies to Vietnam. Samsung, typically, has set up R&D centers in Vietnam, which has helped significantly to boost Vietnam’s science and technology.

(Source: hanoitimes)

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Vietnam's brighter FDI attraction prospects for 2018

Vietnam's brighter FDI attraction prospects for 2018

  December 25, 2017

In 2017, Vietnam saw soaring foreign investment capital inflows totalling at $35.6 billion, up 44.2 per cent compared to 2016. Phan Huu Thang, former director of the Ministry of Planning and Investment's Foreign Investment Agency, deputy chairman of the Vietnam Association of Foreign Invested Enterprises, told VIR about the spotlight review of 2017 as well as the motivation and recommended the strategies in attracting foreign investment capital in 2018.

Phan Huu Thang, former director of the Foreign Investment Agency, talks about prospects for 2018

2017 has been a successful year for Vietnam in attracting foreign direct investment (FDI) capital. What were the highlights of the year in your opinion?

This year quickly overcame expectations both in terms of quality and quantity in foreign investment attraction. Notably, in the ten months of this year Vietnam reported record high foreign investment inflows with $28 billion primarily from APEC economies. The figure was expected to increase to $30 billion by the end of the year, however, by the end of November it was already at $33.09 billion, signifying a year-on-year increase of 82.8 per cent. Even more, the final figure was $35.6 billion.

Regarding policies, the government asked the Ministry of Planning and Investment to co-ordinate with relevant agencies and the provincial authorities of Quang Ninh, Khanh Hoa, and Kien Giang to quickly draw up the Law on Special Administrative-Economic Zones. Despite the heated debate about the contents of the draft law, it will contribute to attracting FDI in the upcoming year once it is approved by the National Assembly next year.

These sweet fruits show that government has been very successful in creating a favourable investment environment for foreign investors, as committed.

The APEC Vietnam 2017 had a wholly positive impact on the country's FDI attraction this year. What motivations stand behind such an increase in 2018?

The APEC’s role in record high foreign investment and FDI inflows cannot be denied. It is sure that the APEC will position Vietnam as a desirable destination for an increasing number of investors. Thanks to hosting the APEC 2017, Vietnam has become better known among foreign investors, reaching those who had yet to consider investing in Vietnam. Besides, being named among the world’s leading economies, such as the US, Japan, South Korea, Russia, Singapore or China has improved Vietnam’s position tremendously.

Besides, back in 2006-2008 after Vietnam hosted the APEC for the first time, we saw a massive wave of foreign investment, setting an FDI record in 2008 with $71.7 billion. On this basis, Vietnam can be optimistic about foreign investment capital inflows in 2018 as well as the subsequent years.

It needs to be added that 2017 marked the 30th year that Vietnam opened its doors to FDI. During these three decades, Vietnam has gradually affirmed its position in the international arena, producing constant growth that has become one of the major factors attracting foreign investment capital.

This year, the processing and manufacturing as well as the property sectors have still received the largest foreign investment capital volumes. Will market dynamics or government initiatives re-route investment flows to other sectors in 2018?

The 4.0 revolution with the appearance of Bitcoin, blockchain, as well as e-wallets, among others, is impacting investment trends on a global scale and Vietnam will not be unaffected. However, we only expect to see distinct changes from 2020 onwards, therefore manufacturing and processing, power distribution and manufacturing, and property will remain the top foreign investment channels in the year ahead. On the other hand, we are looking at increased capital inflows in the M&A market space.

How is Vietnam planning to attract FDI in 2018?

First, Vietnam will continue to focus on attracting high-tech and environmentally friendly projects. Notably, Vietnam will stimulate investment in renewable energy projects, high-tech agriculture, as well as smart cities, among others.

Second, Vietnam will build solutions to create balance in FDI attraction, instead of focusing on Hanoi, Haiphong, Bac Ninh, Binh Duong, Ho Chi Minh City, and Thanh Hoa.

Third, the country will try to attract FDI while keeping our national identity and safeguarding the environment.

(Source: vir.com.vn)

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Vietnam encourages Egyptian businesses through updated investment policy

Vietnam encourages Egyptian businesses through updated investment policy

  December 21, 2017

Vietnam always creates favourable conditions for foreign investors, including those from Egypt, to operate in the country, Vietnamese Ambassador to Egypt Do Hoang Long said at an investment promotion workshop in Cairo on December 20.

During the event, the diplomat highlighted the potential for stronger cooperation in economy and trade between Vietnam and Egypt, saying that the recent State-level visit to Vietnam by Egyptian President Abdel Fatah El-Sisi opened a new stage in bilateral relations.

He briefed participants on Vietnam’s economic development, business environment, investment attraction policies and key exports. 

Photo: Vietnamplus

The ambassador suggested measures to promote economic and trade ties, calling on the two countries’ businesses to participate in trade fairs, exhibitions and investment workshops, thus seeking more business opportunities. The Vietnamese Embassy is always willing to help Egyptian firms connect with partners in Vietnam, he affirmed. 

For his part, Secretary General of the Egyptian Business Association, Mohamed Yousef said leaders of the two nations have agreed to enhance bilateral economic relations, which is bringing great benefits to enterprises from both nations. 

Promoting trade cooperation will enhance two-way trade between the two countries, thus strengthening bilateral ties, he added. Mohamed Yousef also took the occasion to introduce Egypt’s investment environment and policies. 

According to Vietnamese commercial counsellor in Egypt Pham The Cuong, Vietnam has exported a number of goods to Egypt including seafood, coffee, pepper, cashew nuts, wooden products, textiles and mobile phones. Two-way trade reached 311.8 million USD in the first 11 months of this year. 

Egypt is the second largest trade partner of Vietnam in Africa, with two-way trade hitting 316 million USD in 2016. Vietnam exported seafood, automobile spare parts, fabric, black peppercorn, coffee, rubber and other consumer goods to Egypt and imported mainly chemicals, oil products, milk and dairy products, and fibres from the country.

(Source: hanoitimes)

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Top 3 industries gain highest profitability rates in 2017

Top 3 industries gain highest profitability rates in 2017

  December 21, 2017

Finance-banking, real estate-construction and consumer goods are three industries that gain the highest profitability in the securities market in 2017.

According to the Vietnam Report (VNR), as many as 45 per cent of surveyed firms highly valued finance and banking stocks due to their high profitability in the market in 2017.

The finance and banking stocks are also expected to be the most worthwhile investment in 2018, followed by real estate and consumer goods with 29.2 per cent and 20.8 per cent, respectively.

The report also revealed that a company’s development has the main impact on price movement. Stock investors have therefore conducted deeper studies and assessments on quality of traded shares.

Vinamilk is ranked at the first in the Top 10 most prestigious listed companies for 2017.

The Vietnam Report also announced the top 10 most prestigious listed companies for 2017 with Vinamilk ranking the first. It said the top 10 enterprises had good business results and image management.

Its survey of the top prestigious listed companies showed that Vietnam’s stock market this year saw strong growth of the VN Index -- from 665 to 926 points.

The capitalization value was equal to 65 per cent of Vietnam’s gross domestic product in 2017, increased from 35 per cent in 2016. The liquidity was also double that of last year, while foreign investors were active in net buying with total indirect investment rising by 47 per cent from the beginning of this year.

VNR added that the shares that are being traded on the market have improved both in quantity and quality. By the end of October, the total number of listed and registered for trading firms was 1,374, posting 30 per cent year-on-year increase. Many listed companies completed their set targets for the whole years within the first 9-10 months of the year.

The company’s survey revealed that most enterprises were confident about their operation in the first three quarters of the year as 72 per cent of surveyed firms expected their revenue and profit would become higher.

More than 40 per cent of surveyed listed companies reported price hike as of December 13, 2017, such as Hoa Binh Construction Group Joint Stock Company (HBC), Refrigeration Electrical Engineering Corporation (REE), Vingroup Joint Stock Company (VIC) and Phu Nhuan Jewelry Joint Stock Company (PNJ).

VNR said the IPO and capital divestment of large businesses in the time ahead would also contribute to the growth of the stock market. The divestment from leading firms with large stocks such as Vietnam Dairy Products Joint Stock Company (VNM), Vinaconex (VCG) and FPT attracted many big foreign investment funds.

Its statistics showed that in the first 11 months of the year, foreign net buying was US$1.77 billion, six times higher than the same period last year. The market capitalization of foreign investors’ portfolio was estimated at $32.5 billion, increasing by 59 per cent from last year.

This is clear evidence on the attractiveness of the local stock market in 2018, it added.

(Source: hanoitimes)

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India businesses keen on investing in Vietnam

India businesses keen on investing in Vietnam

  December 20, 2017

A delegation from the Confederation of Indian Industry (CII) led by First Secretary of the Indian Embassy in Vietnam Rafiv Bodwade has paid a field trip to Binh Duong province of Vietnam to seek investment opportunities.

During a working session with representatives from the provincial People’s Committee on December 19, Rafiv Bodwade said Indian firms have noticed many investment opportunities in Vietnam, especially in Binh Duong – an industrial hub located in the southern key economic area. Indian enterprises give priorities to investing in the fields of agriculture, pharmaceutics and renewable energy, he stressed.

Vice Chairman of the provincial People’s Committee Tran Thanh Liem briefed the guests on the locality’s socio-economic development, noting that Binh Duong has 29 industrial parks and eight industrial clusters with a total area of over 10,000 ha. 

The locality has so far attracted 28.5 billion USD in foreign direct investment (FDI) from 3,360 enterprises, but Indian-run projects number only five with a total investment of 170 million USD, he said. Binh Duong is calling for investment in projects on large scale which use advanced technologies with less labour and create high added-value products, he added.

India has 134 investment projects worth 1.1 billion USD in Vietnam. Two-way trade in 2017 hit over 10 billion USD, year-on-year increase of 29 percent. The two nations aim to lift their trade to 15 billion USD by 2020.

(Source: hanoitimes)

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Vietnam foreign investment surges in eleven months 2017

Vietnam foreign investment surges in eleven months 2017

  December 18, 2017

The first 11 months of 2017 witnessed a boom in foreign investment in Vietnam, which surged up 53.4 percent year on year to reach 33 billion USD of new capital, according to the Foreign Investment Department under the Ministry of Planning and Investment.

Foreign investment increases in 11 months (Photo: hanoimoi)

The amount includes capital poured into newly licensed and existing projects and share purchase. The figure is expected to reach 35 billion USD by the end of the year, surpassing the yearly target. 

Around 16 billion USD has been disbursed in the 11-month period, up 11.9 percent year on year. 

Disbursement of foreign capital is also expected to reach a record high at about 17.5 billion USD for the entire year.

According to Minister of Planning and Investment Nguyen Chi Dung, foreign investment is expected to maintain the momentum of this year to fare well in 2018. He attributed the increase to the good GDP growth and efforts made by the Government and localities to improve the investment climate.

Meanwhile, Dr. Can Van Luc, senior consultant of the Board of Chairmen of the Bank for Investment and Development of Vietnam, said positive economic growth, macro-economic stability in 2017 and impacts by economic exchange activities in the framework of the Vietnam APEC Year 2017 all will serve as positive factors to help the country attract more foreign investment in the time to come.

He also took note of the Government’s plan to boost foreign investment promotion next year, with focus on the key markets, namely the US, EU members, Japan, the Republic of Korea, and members of the free trade agreements Vietnam has signed.

Capitals sourced by big partners will continue growing thanks to the market room, favourable geographical conditions, developed infrastructure, and taxes preferences, Luc commented.

Most of the foreign investment capital has been poured in construction, transport, energy, real estate, and tourism projects.

Vietnam always welcomes and encourages foreign investment, Prime Minister Nguyen Xuan Phuc affirmed at the recent 2017 Vietnam Business Forum.

The Government and localities are adjusting and developing the legal framework in line with international practice to facilitate foreign investment, he reiterated.

At the same time, Vietnam will conduct checks to timely detect and handle ineffective, dishonest and polluting projects and activities, he added.

(Source: Vietnamnet)

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Japanese investment in Vietnam hits all time high

Japanese investment in Vietnam hits all time high

  December 15, 2017

Total Japanese direct investment capital in Vietnam reached 8.94 billion USD in the eleven months of this year, four times higher than last year, according to the Foreign Investment Agency.

The Japanese capital accounted for 27 per cent of Vietnam’s total FDI capital in the period.

It has helped Japanese investors once again exceed Korean rivals to become the first-ranking investor among 126 nations and territories investing in Vietnam within the 11 months of this year.

To further boost the investment in Vietnam, Japanese enterprises have recently raised four problems they face while doing business in Vietnam in a dialogue with the Advisory Council for Administrative Procedure Reform.

The four issues include foreign workers’ compulsory social insurance participation, waste treatment regulations in the draft Law on Environmental Protection, regulations on the import of used machinery and equipment, and the import of automobiles regulated by the Government’s Decree 116/2017/NĐ-CP.

Japanese capital accounted for 27 per cent of Vietnam’s total FDI capital in 11 months.

Chairman of the Japan Business Association in Vietnam (JBAV) Hiroshi Karashima suggested the Vietnamese Government revise regulations on compulsory social insurance for foreign employees. He called on the Government to allow exemptions for people that have paid compulsory insurance in Japan.

The mandatory insurance participation reduces the attractiveness of the country as an investment destination, the chairman highlighted.

In response to this recommendation, a representative of the Ministry of Labour, Invalids and Social Affairs (MOLISA) said that the payment of social insurance premiums is meant to protect the legitimate rights and interests of workers in Vietnam. Many countries have a similar issue and the common solution is to negotiate bilaterally, the representative said.

Many Japanese firms are concerned of the provision of Circular 23/2015/TT-BKHCN relating to the import of secondhand machinery, saying that restrictions on importing old machinery could hinder large investment flow into Vietnam by Japanese SMEs.

The Japanese business association suggested that machinery and equipment imported for Japanese production activities should not be restricted in terms of the age of the equipment and should not be subject to the import regulations.

Deputy Minister of Science and Technology Pham Quy Duong said that Circular 23 was formulated with the main purpose of limiting the import of old machines to ensure quality and productivity and to avoid the energy waste caused by the use of old machinery. The Ministry of Science and Technology has recognized firms’ difficulties with Circular 23 and made amendments, Duong said.

He said that the Law on Foreign Trade Management will come into force on January 1. Article 9 of the decree guiding this law’s implementation will have regulations related to the age of machinery and equipment imported into Vietnam and the process for special cases.

The deputy minister insisted that imported equipment must meet the standards of safety, energy efficiency and environmental protection in accordance with standards of Vietnam and some G7 countries.

Decree 116/2017/ND-CP on automobile production, assembly and import and maintenance services for automobiles causes problems for importers, said Toru Kinoshita, a member of JBAV. The decree requires some certificates provided by foreign authorized agencies.

The association recommends that the Government apply only the model test for each vehicle type of the first shipment and accept the test report for subsequent shipments over a six-month period.

Minister and head of Government Office Mai Tien Dung, who is also Chairman of the Advisory Council for Administrative Procedure Reform, explained that Decree 116 is intended to protect producers and consumers. The minister said it is important to inspect each batch of goods to assess compliance with the law.

However, Dung asked the Ministry of Transport to cooperate with the Ministry of Justice and the Ministry of Industry and Trade to revise the regulations. He affirmed that the recommendations and questions from the Japanese enterprises will be considered by Vietnam’s authorized agencies.

The official emphasized that the Vietnamese Government will continue to create a clear business environment for foreign investors.

(Source: hanoitimes.com)

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