Foreign Direct investment (FDI) projects that have expired but not yet re-registered, will be revoked after February 1st next year.—Photo vneconomy

HA NOI (Biz Hub)— Foreign Direct investment (FDI) projects that have expired but not yet re-registered, will be revoked after February 1st next year, according to a newly issued directive from the Ministry of Planning and Investment (MPI).

The directive was sent to all municipal and provincial People's Committees, the management boards of industrial zones, export processing zones, economic zones and high technology zones.

The ministry said that the country will revoke business licences, levy fines and wind up projects whose licences were granted before July 1, 2006, but have still not re-registered in accordance with the current investment law.

According to the ministry, amending and supplementing the Enterprise Law on the re-registration of FDI businesses whose licences have expired was approved by the National Assembly and came into effect on August 1, 2013.

Currently, The ministry is putting final touch on a replacement draft decree for the Government on re-registration, registration changes and transformational investments for FDI enterprises under the provisions of the Foreign Investment Law and the Enterprise Law to be submitted to the Government later this month.

To bring the law into effect as soon as possible, the ministry has asked all relevant agencies to urgently review, classify and make a list of FDI enterprises in each locale, including ones registered before July 1, 2006 but not yet re-registered as well as those that have expired under the business registrations but have not proceeded with the end of project procedures.

All localities have to report back to the ministry prior to September 1 this year, it said.

The ministry also requested agencies to report on how the re-registration of FDI enterprises was proceeding as well as urging and helping them to re-register their businesses.

Ripe for investment

The good investment environment is the reason for several provinces attracting an increasing amount of foreign investment in recent years, according to the MPI.

Thai Nguyen, Bac Ninh, Hai Phong, and Thanh Hoa are among the provinces to have emerged as new attractive destinations for foreign investors.

Central Thanh Hoa moved up from the 28th place in the list of FDI last year to top in the first half of this year with over US$2.81 billion, most of which is from additional investment in the Nghi Son Refinery and Petrochemical Project.

Northern Thai Nguyen Province, which ranked 38th last year, has moved up to the second position with nearly $2.16 billion.

In the first six months of last year, northern Bac Ninh Province had attracted $69.5 million to rank 12th. But by the end of the year it had moved up to the sixth position with over $1.16 billion.

In the first half of 2013 Bac Ninh has continued its ascent to move into the third position with more than $1.32 billion.

The city of Hai Phong moved up from the 10th place in the first half of 2011 to the fourth position at the end of that year.

In the first six months of last year, while FDI in other localities fell relentlessly, it continued to rise, reaching $934.8 million, taking the city to the third place.

Analysts said that in the past, these provinces had virtually been ignored by foreign investors, but now, with their abundant land and human resources in addition to attractive incentives, they have become magnets for foreign investors.

Nguyen Ba Cuong, deputy director of the Foreign Investment Department, said as foreign companies recognize their potential advantages, FDI flows move from major cities to smaller ones and provinces.

The advantages include abundant "clean" land, human resources, and a significantly improved investment environment, he listed.

Central Quang Ngai Province is a typical example. In a recent seminar it organised in HCM City to solicit domestic and overseas investment, the provincial People's Committee promised to pull out all the stops to help investors.

Projects in Quang Ngai would get income tax breaks while duties would be waived on raw materials and equipment, it said.

It will also provide support in the form of training for workers and supply of technical workers.

Investors will also get priority in building infrastructure for their plants and be allocated land to build houses for their specialists.

The analysts said the change in investment destination, especially by foreigners, is of great significance since it is creating jobs for rural people, thus reducing migration to major cities, which is causing huge pressure on urban areas.

But to ensure the effectiveness of these new investments, local authorities should carefully assess environmental impacts and the investors' capabilities before granting them licences. —VNS