Automobile production at the plant of Japan-invested Toyota Viet Nam in Vinh Phuc Province. A number of foreign technology corporations were eyeing large investments in Viet Nam. — VNA/VNS Photo Danh Lam

More tech could be coming to Viet Nam soon as foreign enterprises demonstrate an appreciation for the country's attractive investment environment.

A number of foreign technology corporations were eyeing large investments in Viet Nam, given the country’s improved business climate, rapid global integration, abundant labour resources and success in containing the coronavirus, Do Nhat Hoang, Director of the Foreign Investment Agency under the Ministry of Planning and Investment said.

Hoang spoke at an online seminar themed “Attracting foreign investment flow: breakthrough actions and solutions” held by the Government’s e-portal baochinhphu.vn on Friday. He said several foreign technology firms were negotiating to set up their projects in Viet Nam, some of which were worth billions of US dollars.

A number of factors were making Viet Nam attractive in the eyes of foreign investors, Hoang said.

“We have a market of nearly 100 million people, an abundant young labour force, competitive production costs, rapid integration into the world economy, drastic administrative reforms and improving transport infrastructure. These are factors making Viet Nam an attractive destination for foreign investment,” he said.

As Viet Nam participated in a number of free trade agreements (FTAs), the country was enjoying many preferential trade policies with liberation of tariffs. Moreover, the success in containing the COVID-19 pandemic also made Viet Nam more attractive.

Hoang said the Government’s special working group to attract foreign direct investment (FDI) had actively worked with foreign technology corporations about their possible investment projects in Viet Nam to ensure their investments were compatible with the country’s target in attracting FDI.

Some intended to invest up to billions of US dollars in Viet Nam, Hoang said, refusing to disclose more details because the negotiations were underway.

According to Nguyen Van Toan, Deputy Director of the Viet Nam Association of Foreign Invested Enterprises (VAFIE), Viet Nam has a significant opportunity to capture the FDI flow from the global production shift.

Toan said that it was necessary for Viet Nam to improve the quality of the labour force, adding that the lack of skill and discipline remained a weakness but flexibility and innovativeness were strengths of Viet Nam, especially in the era of Industry 4.0.

According to former Director of the Central Institute for Economic Management Nguyen Dinh Cung, the restructuring of the global value chains were taking place.

Cung, however, said that the only advantage of Viet Nam in the race to attract FDI was that we have trade deals with major markets in the world.

“The global production shift brings opportunity, but the important thing is what we want and what we get,” Cung said.

He questioned why the FDI flow to Viet Nam mainly came from Asian countries and not from US and European countries. “If we want to attract FDI from the US and European countries, we must act to meet their requirements.”

Administrative reforms must be hastened at all management levels to create a favourable environment for investors, he said.

The policies should be tailor-made for each investor, Cung stressed, adding it was necessary to figure out the problems and implement measures to remove barriers.

Cung said that the attraction of FDI must be based on the strength of each locality. “This is a win-win for both sides,” he said.

According to Hoang, it was important that the Government develops policies to enable small and medium-sized enterprises to participate in the global value chain.

Hoang at the seminar said that global investment flow was forecast to fall by 20 per cent this year due to the impacts of the COVID-19 pandemic.

The ministry’s statistics showed that Viet Nam attracted $19.54 billion in FDI in the first eight months of this year, equivalent to 86.3 per cent of the same period last year. — VNS