Skype investment

A representative of this company said it will pour investment in the millions of USD into Vietnam over the next few months. The capital will be used to expand the storage of vehicles and engines and invest in advanced technology regarding engine exhaust inspection systems for automatic vehicles.

After 5 years of operations, with steadily increasing output, the company built more factories earlier this year to meet the needs of production expansion.

The average size of both newly-licensed projects and those adding capital increased strongly year-on-year, which was the main reason behind the strong increase in FDI. Another positive in the first quarter was that disbursed capital rose 6.5% year-on-year.

It is forecast that FDI attraction will continue to be positive in the context of many investors shifting the location of their investment and major investors in the country expanding existing projects./.

The sub-zones include the Cai Rong Area, North Cai Bau Area and the Van Don airport area.

Speaking at the conference, Quang Ninh Vice Chairman Cao Tuong Huy praised the Van Don Economic Zone management board for completing the plans for the economic zone’s most important areas.

He also spoke highly of investors who had overcome the difficulties caused by Covid-19 to quickly finalise procedures for their projects.

The official added that such plans are the basis to call for capable and reputable investors to implement high-quality projects, helping boost sustainable socio-economic development in Van Don.

At the conference, Quang Ninh Province granted an investment license to a high-end hotel and resort complex to Cat Linh Van Don Company and Mai Quyen Tourism Company.

The project will cover 2.34 hectares and has total investment capital of VND4 trillion (US$173 million).

The call for investment in the Van Don Economic Zone has affirmed Quang Ninh Province’s consistent policy of reforming administrative procedures and improving the business environment.

Vice Chairman of the Hung Yen Provincial People’s Committee, Bui The Cu, said that after four years of implementing Resolution No. 08-NQ/TU, dated October 4, 2016 by the Executive Committee of the 18th Hung Yen Provincial Party Committee on the Hung Yen transport development programme 2016-2020, with a vision to 2030, the transportation system in the province has witnessed many changes with rapid development.

Works and roads at national, provincial and district levels have been renovated and upgraded to form a relatively synchronous transport infrastructure network, contributing to changing Hung Yen’s face and bringing a new position to the province, while ensuring national defence and security for the province’s socio-economic development.

Typically, the first phase of the route linking the Hanoi – Hai Phong expressway to the Cau Gie -Ninh Binh highway has brought about high efficiency, connecting many roads in Hung Yen province with the national highway system which crosses the northern region. In the vicinity of this road, there are three industrial zones, including a clean zone, covering more than 143 ha, the Industrial Zone No. 3, covering over 159 ha and the 263 ha Industrial Zone No. 1, belonging to the Ly Thuong Kiet Industrial Park and Urban Service Area, approved by the Prime Minister to be added to the planning of industrial parks in Vietnam by 2020. This has created breakthroughs in attracting investment serving socio-economic development in Hung Yen province in the coming years.

Implementing Resolution No. 08-NQ/TU regarding Hung Yen’s transport development programme for the 2016-2020 period, with a vision to 2030, the local authorities have solidified the objectives, tasks and solutions to implement the resolution, including plans to invest in the development of a comprehensive, modern and sustainable transportation system, ensuring the continuity and linking various modes of transport and localities in Hung Yen with each other, as well as connecting its urban and rural areas, connecting Hung Yen with Hanoi and other provinces in the northern key economic region. The province is also concentrating on completing the construction, renovation, upgrading and putting into operation many important roads, such as a road linking the Hanoi – Hai Phong expressway with the Cau Gie – Ninh Binh expressway, the Hung Ha and La Tien Bridges, the ĐT 376 route (provincial Road No. 200), and the dyke system to the left of the Red River.

The rural transport infrastructure in Hung Yen has seen a high investment level in association with promoting new rural area construction. Since 2016, Hung Yen has poured more than VND3.7 trillion into renovating and upgrading over 190 km of district roads and bridges and more than 241 km of communal roads and bridges, as well as over 621 hamlet and inner-field roads, thus increasing the rate of district roads paved with asphalt or concrete to 97.7%, while the rates for communal/hamlet and inner-field roads reaching 99.2% and 84.3%, respectively. Moreover, 100% of communes have met the rural transport criteria in the set requirement criteria for the new rural area construction programme.

Hung Yen is located in the northern key economic region, with a relatively high economic growth rate, having 10 approved industrial parks and three others approved by the Prime Minister to be added to the planning of industrial parks in Vietnam by 2020, making the province a great potential destination for developing industry-services and attracting investment, especially foreign investment. Therefore, the transport network in Hung Yen needs to be developed and better connected with the major traffic system of Hanoi and across the region as a whole.

In order to complete the transport infrastructure system, Hung Yen has been preparing to commence various major projects, including Phase II of the road project linking the Hanoi – Hai Phong expressway and Cau Gie – Ninh Binh bridge expressway, belt roads No. 4 and 3.5, the project to renovate and upgrade National Highway No. 39 from the Ly Thuong Kiet Intersection to Highway No. 5 connecting the province’s north-south economic axis and the interprovincial road linking Ring Road 5 of the Hanoi Capital Area in the territory of Thai Binh province with National Road No. 38B and the Hanoi – Hai Phong Expressway, crossing Hung Yen province.

For its provincial roads, Hung Yen is focusing on constructing and completing multiple projects, such as investing in renovating and upgrading the DT.387 route, extending the DH.17 to the DT.379 road, some sections of the DT.382B route (side road for the Hanoi – Hai Phong expressway), and upgrading the DT.378 route covering the dyke system of the Luoc River. The province has also carried out procedures and is preparing to commence other projects, such as improving and upgrading DT.379 to a level II route, developing the north-south economic backbone project for the province using capital from the OFID, and a project on upgrading and expanding provincial road No. 378 covering the dikes along the Red River (in phase 2).

The province is also ready to invest in a number of projects, including urgent side roads on National Highways No. 5, 38 and 39, side roads connecting the Hanoi-Hai Phong and Cau Gie-Ninh Binh expressways. For district roads and rural roads, Hung Yen is striving to achieve the goal of 100% of district roads and inter-commune roads being paved with asphalt or concrete, with 100% of roads in villages and hamlets and main roads in the fields hardened, fulfilling the criteria for rural transport in the new rural area construction programme.

Hung Yen is also targeting the effective mobilisation and use of investment capital sources from the provincial concentrated budget, as well as targeted support capital sources from the Government and the relevant ministries and central agencies, in addition to Government bonds and ODA loans. It is also focusing on promoting the exploitation of capital from investors in the forms of PPP, BOT and BT for its key projects, while giving priority to the allocation of provincial reciprocal capital for transport projects under the various programmes with loans from the central budget and ODA.

Hung Yen has promoted auctions on land use rights to create capital for the development of its transport infrastructure, while making use of capital sources from the Government’s national target programmes, government bond capital and other support. It has continued to strengthen its propaganda work and mobilise organisations, investors and local people to contribute funds, land and labour days to build rural roads, especially commune, village, hamlet and inner-field roads. The province has boosted the study of preferential policies for businesses and investors to invest in transport infrastructure works, while creating favourable conditions for organisations and businesses to access and research investment projects in the form of PPP, BT and BOT.

It has also developed appropriate policies according to regulation in order to accelerate ground clearance for projects to ensure their progress and investment efficiency. Priority is being given to a rational land fund for the development of the provincial transport infrastructure, paving the way for socio-economic development, increasing land use value in the locality, thereby creating land funds to invest in developing the transport infrastructure. It has erected landmarks to plan routes according to approved planning regulations. The land use planning for transport infrastructure needs to be unified and carried out in a synchronous manner with close cooperation between the relevant departments, branches and localities in the province to carry out the site clearance effectively.

Sharp increases in capital contributions and share purchase

According to the Ministry of Planning and Investment (MPI), there were 1,321 valid projects invested in by Vietnamese enterprises abroad with a total registered capital of US$20.6 billion by the end of 2019. The disbursement of the investment capital was US$9.49 billion by the end of the same year.

Vietnamese enterprises have invested in 78 countries and territories across the world with the largest investments poured into Laos, Russia, Cambodia, Venezuela, and Myanmar. Enterprises invested in 18 key industries and sectors with the biggest capital running in the oil and gas industry, accounting for 38.4% of the total offshore investment capital.

About 15.3% of the investment capital was poured into agricultural, forestry and fishery sector while 12.8% of the capital was invested in telecommunications and information technology and 7.2% of the capital went into the hydroelectricity sector.

The number of small and medium-sized projects run by the private sector has increased over the years while the number of large-scale projects run by State-owned enterprises in the areas of oil and gas exploration and extraction, telecommunications, industrial crops and hydroelectricity has fallen sharply.

The volume of investment capital transferred abroad has tended to decrease since the 2015-2017 period due to a plummet in the number of large projects.

According to the MPI, accumulated profits transferred to Vietnam from abroad was approximately US$3 billion while the profit retained for reinvestment was about US$363.4 million. Nearly 10,000 Vietnamese workers have been sent abroad to work.

In addition, Vietnamese enterprises have established a significant amount of assets abroad including factories and production facilities worth billions of US dollars. These are favourable conditions for Vietnamese enterprises to expand their overseas investment and business activities in a context of deeper international economic integration.

Notably, investment abroad in 2019 was entirely implemented by the private sector with no projects conducted by State-owned enterprises. More and more large private corporations and domestic joint stock companies have invested in developed countries in order to expand their market and affirm their brands such as Vingroup, Vietjet, Thaco, T&T, Vinamilk, FPT, and others.

Investment forms are also diverse with an increasing number of investment projects in the form of capital contributions and share purchase in foreign enterprises.

Minister of Planning and Investment Nguyen Chi Dung said that there are Vietnamese enterprises that have spent US$3-5 million to buy shares of foreign enterprises that are now valued in the hundreds of millions of US dollars.

Major global changes due to the COVID-19 pandemic have led to a wave of mergers and acquisitions through capital contributions and share purchase at potential companies for very cheap prices. Vietnamese enterprises need to have big aspirations to participate in this market segment to accelerate the process of reaching out to the world and bringing greater value into the country.

To date, five Vietnamese enterprises have invested abroad with registered capital of over US$1 billion each including the Vietnam Oil and Gas Group (Petrovietnam), Military Industry and Telecoms Group (Viettel), Vietnam Rubber Group, Hoang Anh Gia Lai Group, and Long Thanh Golf Investment and Trading JSC.

Besides these impressive achievements, there remain inadequacies including legal risks, international lawsuits and disputes, slow progress of projects, and ineffective implementation of projects, among others.

According to experts, the change in the investment tendency of Vietnamese enterprises in recent years has been market-oriented and consistent with the process of trade and investment liberalisation and international economic integration.

There is large room and great potential in international markets, thus, the most important thing for offshore investment is to perfect mechanisms and policies and create more favourable conditions for private enterprises to easily invest their resources abroad in order to transfer the profits to Vietnam. Meanwhile, enterprises need to improve their governance capacity, their ability to grasp the market and sufficiently strong cash flows.

The amended Law on Investment which will take effect on January 1, 2021 has completed policies on investment abroad regarding clear updates of cases prohibited from investment abroad, conditions accompanied with investment abroad, lending abroad, reporting the process of State management agencies related to investment abroad, the use of profits from overseas projects to contribute to other projects abroad, and others.

To prevent risks in offshore investment activities, the MPI has proposed the Government assign relevant agencies to review and evaluate investment trends abroad in the areas of real estate and the investments of foreign investors in Vietnam abroad in order to devise timely solutions to problems arising.

In addition, Vietnam should boost negotiations and early signing of investment promotion and protection agreements with countries receiving large investment from Vietnam or with Vietnam’s potential partners to create a legal framework for safe and effective investment abroad.

By Celine Luu