Vietnam is looking to attract investors from Japan and South Korea into the country’s supporting industries as the localization rate of the sector is quite low compared to some countries in the region, according to General Director of the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment Do Nhat Hoang.
|Overview of the signing ceremony.|
“To create favorable conditions for businesses who want to invest or expand their footprint in Vietnam, we have established a task force with the aim of solving every hurdle they are facing,” Mr. Hoang said at a signing ceremony of a Memorandum of Understanding (MoU) between the FIA and Ernst & Young Vietnam Limited (EY Vietnam) on October 6.
The MoU targets promoting investment opportunities towards the investors including EY clients across the globe, paving the way for their new and/ or expanded investment in Vietnam.
Under the MoU, FIA will provide EY Vietnam with updated information on directions and policies to draw investment into Vietnam. The agency also assists investors introduced by EY Vietnam to conduct researches and implement business-investment procedures in accordance with the law; endorse, resolve or forward the investors’ recommendations to the relevant authorities.
On the other hand, EY Vietnam will introduce and recommend potential investors who are EY clients globally to invest in Vietnam, especially those from Japan and South Korea, countries that have the largest FDI value realized in Vietnam.
Additionally, EY may coordinate with the FIA to organize seminars, conferences and round-table discussions for investors introduced by EY, depending on the scale and features of each event.
EY Capital Confidence Barometer’s survey conducted in early 2020 indicated that 74% of Japanese companies interviewed will likely to change the set-up of their supply chain after Covid-19. Therefore, this could be a good opportunity for the Vietnamese government to attract investment arising from that trend.
|Overview of the meeting.|
Implementing the MoU, EY Vietnam will also keep FIA well informed of trading and investment trends regionally and globally; support FIA to conduct detailed and strategic researches in order to evaluate opportunities, effective investment models, solutions and best practices for Vietnam.
The MoU signed in the context that Vietnam has favorable conditions to engage international investors. As a result of the negative impacts triggered by Covid-19 and trade tensions among substantial countries and territories, multinational corporations are accelerating the restructuring of their global value chain while seeking to reduce the dependence on a single market.
“Vietnam will actively and selectively attract foreign investments, taking high-quality, efficiency, modern technology and environmental protection as the key benchmarks” said Deputy Minister of Planning and Investment Tran Quoc Phuong. "Vietnam also prioritizes advanced technology and green projects, with high value-added components, connecting with global production and supply chains”.
Mr Tran Dinh Cuong, Country Managing Partner, EY Vietnam said the company is committed to supporting multinational conglomerates and hi-tech firms to gain a thorough understanding of local business environment, incentives policies, promoting sectors and areas – whereby leading to an increment of both foreign direct and indirect investment.
By the end of September 20, 2020, Vietnam had 32,658 valid FDI projects with a total registered capital of US$381.5 billion. Aggregated implementation capital of these projects is estimated at US$225.8 billion, equivalent to 59.1% of the total legitimately registered investment capital, according to data from the FIA.