The Vietnamese border reopening has helped most business activities resume. Many investors are eyeing the blooming real estate market in hopes of investing in Vietnam.
Find out in this article 3 top reasons why Vietnam is a worthy destination for foreign investors.
Incentives from Trade Agreements
Vietnam has a number of trade agreements in place to make businesses even easier to start. These trade treaties make it simpler for foreign investors to set up businesses and benefit from cheaper tariffs, especially when you’re planning to buy property overseas. Below are some of the most important trade agreements:
The EU-Vietnam Trade Agreement is the EU’s most extensive trade agreement with a developing country. The EU-Vietnam trade agreement is anticipated to remove tariffs on 99 percent of all goods traded between the two nations.
Related: Top 4 biggest reasons you should invest in Vietnam now
The Association of Southeast Asian Members (ASEAN) Free Trade Area (AFTA) is a commerce agreement that encourages local trade and industry in all ASEAN nations while also allowing economic integration with regional and international partners. The primary goals of AFTA are to boost ASEAN’s competitiveness as a global industrial base by eliminating tariffs and non-tariff barriers within ASEAN and attracting more foreign direct investment to the area.
UK-Vietnam Free Trade Agreement: According to the UK government publishing services, 65 percent of all tariffs have been eliminated since the EU-Vietnam Free Trade Agreement went into effect. Tariff reductions will reach 99 percent after 6 to 9 years. As a result, shoppers and businesses will benefit from lower prices on garments, fabrics, and footwear.
Sociopolitical Stability
Vietnam is a politically stable country governed by the Communist Party of Vietnam (CPV). The primary purpose of the government is economic growth, as well as the preservation of the one-party state structure, territorial integrity, and social order. It aspires to be middle-income by 2025, upper-income by 2030, and developed, high-income by 2045.
Furthermore, the Vietnamese economy has changed dramatically, with millions of people pulled out of poverty. Despite the COVID-19 epidemic, it remains one of the world’s fastest-growing economies, with 2.9 percent GDP growth anticipated for 2020 (the country’s economy grew by 7% in 2019). According to the IMF, the country’s GDP is expected to be US$341 billion, putting it 38th globally and 4th in ASEAN, making it an attractive investment destination for global investors.
A Shift from China’s Supply Chain
As the United States maintains tariffs on Chinese goods, Vietnam looks to be one of the countries that will benefit the most from corporations looking to diversify away from Asia’s most important industrial powerhouse, China. According to analysts, the epidemic has highlighted the need of corporations diversifying their supply chains away from China, where the crisis began, and using the potential of emerging economies such as Vietnam.
Invest in Vietnam now!
With these benefits, there is no question that Vietnam will remain a desirable investment location in the next few years. Foreigners can invest in Vietnam by taking advantage of the incentivizing trade agreements, peace, and supply chain shifts from China.
This article is co-written with Homebase, a prominent Southeast Asian proptech business that makes homeownership more accessible to purchasers. They are supported by multi-billion dollar global funds like Y Combinator and Antler. To get started, call (+84) 964 245 404 or fill in a form online.
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Source: Vietnam Insider