The event attracted more than 200 foreign direct investment (FDI) enterprises and leaders of provinces and cities in the Southern region.
Many lingering problems
At the forum, there were 4 issues that FDI enterprises wanted to be resolved soon: administrative procedures related to traffic infrastructure; tax policies; investment licensing procedures; and work permits for foreigners.
Regarding infrastructure, especially transport infrastructure, Mr. Tran Anh Duc, representative of the VBF investment and trade working group, acknowledged that it is currently not meeting demand. Specifically, roads to ports such as Cat Lai and Long Thanh - Dau Giay expressway are often congested; Tan Son Nhat airport is overloaded...
Because of limited infrastructure, logistics costs in Vietnam are very high compared to the world. In particular, transportation costs account for 30%-40% of product costs, while the world average is only 10%-12%.
Regarding tax policy, some FDI enterprises in Ho Chi Minh City and Ba Ria - Vung Tau reported delays in value added tax (VAT) refunds. Mr. Takahisa Onose, representative of the VBF tax and customs working group, said that enterprises have actively submitted documents and papers as required, but tax refunds are still... sluggish!
For example, Itochu Vietnam Co., Ltd. (100% Japanese capital, headquartered in District 1, Ho Chi Minh City) has explained its VAT requirements, but from 2022 until now, it has not been completely resolved. This makes it difficult for businesses because the tax refund amount is up to 80 billion VND.
Regarding investment, Mr. Takahisa Onose mentioned the case of a company headquartered in the Ho Chi Minh City High-Tech Park that signed a framework contract on investment with specific preferential policies since 2005, but in 2018, the State Audit requested to collect land rent arrears of more than VND 16.6 billion.
Up to now, the company wants to continue implementing its business plan but cannot do so due to the above-mentioned arrears.
Many FDI enterprises said that “time is money for investors”, so administrative procedures related to investment activities need to be quick and transparent. Although enterprises have made many requests, procedures related to granting business licenses and permits for foreign workers are still very complicated and lengthy. Furthermore, there is a lack of consistency in understanding and implementation in each locality.
Real estate market attracts more than 2.5 billion USD of FDI capital
According to the General Statistics Office, by the end of August 2024, the total registered foreign investment capital (FDI) in Vietnam reached 20.52 billion USD, an increase of more than 8% over the same period in 2023.
Of which, 2,247 newly licensed projects were granted capital with registered capital reaching nearly 12 billion USD, an increase of 8.5% over the same period last year in terms of number of projects and 27% in terms of capital.
Real estate business alone attracted 2.4 billion USD, 5.1 times higher than the same period last year and accounted for nearly 20% of the total newly registered capital. If including newly registered capital and adjusted registered capital, registered FDI capital in real estate business reached 2.55 billion USD, 3.7 times higher than the same period last year and accounted for 14.4% of the total newly registered and increased capital.
Regarding the form of capital contribution and share purchase by foreign investors, investment capital in real estate business activities reached nearly 812 million USD, accounting for 29%.
DONG GIA
Ready to cooperate and invest
Responding to investors, Ho Chi Minh City leaders acknowledged that infrastructure is a weak link in the entire Southern region. However, the Government is currently paying attention to the transport infrastructure in this region, implementing many projects. This is also an opportunity for foreign investors to participate. In Ho Chi Minh City, on April 30, 2025, Tan Son Nhat Airport Terminal 3 will be put into operation; metro lines are taking shape.
Leaders of departments, Tan Son Nhat International Airport, Ho Chi Minh City High-Tech Park Management Board... also noted the opinions of investors and are making efforts to improve service quality, increase digitalization to speed up travel time, immigration, propose policies to attract investment in digital infrastructure, develop big data centers, projects related to artificial intelligence, semiconductors...
Regarding sustainable growth, some investors presented many new cooperation ideas, including using abundant raw materials in Vietnam to produce clean fuels.
Ms. Tran Tuyet Minh, Vice Chairman of Binh Phuoc Provincial People's Committee, said that the province has great potential for foreign investment cooperation in the energy sector. In particular, the processing of cashew nut shell oil is receiving much attention from countries, which can be used in the plastics industry, aircraft equipment, and raw materials for renewable energy. Currently, there is no processing technology, if cooperation is possible, it will open up a future in reducing carbon emissions in the aviation industry.
Meanwhile, Chairman of Dong Thap Provincial People's Committee Pham Thien Nghia said that the province wishes to invest and cooperate in areas that are the locality's strengths, including deep processing of agricultural products.
Vice Chairman of the Ho Chi Minh City People's Committee Vo Van Hoan also emphasized that the Southeast and Mekong Delta provinces have great potential for cooperation in the fields of agriculture, forestry and fisheries. Raw materials such as catfish fat, coconut shells, rice husks, etc. are always available. If foreign investors have a need, they can conduct further research, set up factories, and guide farmers to participate.
Ho Chi Minh City leaders also welcome the establishment of a financial mechanism for “green” projects with funding sources. Science, technology, innovation and the 4th industrial revolution have had and are having profound and multi-dimensional impacts on countries.
This is also an opportunity for the city and provinces to improve technology and production capacity, accelerate the transformation of the growth model based on science, technology and innovation, but also poses challenges in solving employment, inequality and the gap between rich and poor.
“HCMC and other provinces are ready to cooperate and accompany businesses, especially FDI enterprises, in resolving difficulties and problems related to policies, supporting FDI enterprises to improve their production and business efficiency. From there, encourage investors to commit to long-term, strategic investment in the city, the Southeast region and the Mekong Delta,” said Vice Chairman of the HCMC People’s Committee Vo Van Hoan.
Mr. COLIN BLACKWELL, Head of VBF Human Resources Group:
Applying for work permits for foreign workers... is difficult
Current regulations require workers to apply for a work permit at their intended place of work and update each work location when workers are assigned to work in different localities, which is impractical in many cases.
Instead, it would be more efficient and practical to issue a single work permit at the business registration location of the enterprise and to report when the employee is sent on a business trip of 30 days or more to another locality.
In addition, it is necessary to simplify the review process before recruiting foreigners. At the same time, allow priority cases to quickly process work permit applications for projects with large impacts, projects with large investments or projects with good compliance records...
The application of legal regulations also needs to be consistent across provinces and cities, avoiding the situation where each locality may have different interpretations.
Mr. SECK YEE CHUNG, Co-Head of VBF Investment and Trade Group:
Investment licensing procedures are still complicated.
Vietnam could significantly boost foreign investment by simplifying and streamlining the procedures for applying for and renewing business licenses. This is especially important for foreign investors who may be deterred by complex processes.
Specifically, according to Decree 09/2018 on granting business licenses, it is stipulated that only a few cases need to seek the opinion of the Ministry of Industry and Trade, but in reality, most cases carry out this step.
This time can last up to 3 months for each internal process between the Department of Industry and Trade and the Ministry of Industry and Trade. If there are 2 to 3 rounds of questions and/or additional information requests from the Ministry of Industry and Trade, it can take up to 9-12 months to complete. In some cases, it can even take 1 year to obtain a business license.
This can cause significant delays in investment registration and incur additional costs for investors/businesses.
We recommend that the authorities consider and not request any additional documents other than those required by law. At the same time, there should be a time limit as well as a limit on the number of requests for additional documents.
AI VAN - PLUM FLOWER
Source: https://www.sggp.org.vn/go-vuong-de-thu-hut-manh-dau-tu-nuoc-ngoai-post759625.html
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