Vietnam had more than 27,500 valid FDI projects involving 130 countries and territories with a total committed capital of 340 billion USD as of December 31, 2018. FDI accounts for 20% of Vietnam’s GDP and 70% of its annual export revenue, contributing to the recent trade surplus.
FDI attraction over the past 3 decades has been fruitful as a result of a steadily improved business environment, greater trade openness, and Vietnam’s geographical advantages. But there’s a growing need for new policies to ensure FDI sustainability and added value. “The government intends to initiate a project to review 30 years of FDI attraction. Based on the results, we will issue a resolution on directing and fine-tuning mechanisms and policies to make FDI use more effective.” Deputy Prime Minister Vuong Dinh Hue spoke at a consultative conference on fine-tuning foreign investment policies in Binh Duong province on Thursday.
Vietnam’s current growth model is based on natural resources exploitation, outsourcing, FDI, and exports. This model is challenged by Industry 4.0, in which AI and robots will replace human labor and manufacturing jobs will return to the developed world. Vietnam has sought ways to minimize the adverse impacts of the 4th Industrial Revolution, including redirecting its FDI attraction policies.
“Vietnam will continue to reform its mechanisms, policies, and laws in line with a socialist-oriented market economy. We will continue to listen to businesses’ opinions to make our laws and policies more compatible with international practice. International integration should be strengthened”. Vietnam’s Prime Minister Nguyen Xuan Phuc said last year. “As Vietnam has joined international trade agreements, there is a great potential for domestic and foreign businesses to thrive in Vietnam. I hope that these initial reforms will create a better environment for investors in Vietnam.” Phuc added.
In addition to improving its market economy mechanism, Vietnam is encouraging entrepreneurship, innovation, technological transfer, infrastructure upgrade, and human resource development. The government is finalizing a project on fine-tuning institutions and policies to improve the quality of FDI by 2030.
“Vietnam continues to be an attractive investment destination for many businesses. Foreign direct investment flows to Vietnam rose to a new record in 2018. We are happy to support many foreign-owned enterprises from all over the world to identify business opportunities and to expand their business operation in the country” said Ms. Sophie Dao, Partner of GBS, an Investment Consulting firm in Vietnam said.
To be advised about how to start your foreign invested business in Vietnam, you may contact directly Ms. Sophie Dao at: info@gbs.com.vn, hotline: +84903189033 or visit the company website at: https://gbs.com.vn