With the Investment Support Fund expected to be issued in 2024, a series of unprecedented investment support policies in Vietnam will be applied. Thanks to that, Vietnam will have more attractiveness to welcome "eagles".
With the Investment Support Fund expected to be issued in 2024, a series of unprecedented investment support policies in Vietnam will be applied. Thanks to that, Vietnam will have more attractiveness to welcome "eagles".
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| Not only does Vietnam need a systematic strategy, it also needs breakthrough and outstanding mechanisms to attract investment. Photo: Duc Thanh |
Revealing breakthrough policies
Following the consensus from the National Assembly Standing Committee at its recent session, the Government’s Decree on the establishment, management and use of the Investment Support Fund is expected to be issued soon. Accordingly, a series of breakthrough, outstanding, and even unprecedented investment support policies in Vietnam will be applied.
For example, direct cash payments will be made to support a range of costs, such as training and human resource development costs; research and development (R&D) costs; fixed asset investment costs; high-tech product manufacturing costs; social infrastructure investment costs; and other cases decided by the Government.
The support rates are also very attractive. For example, support up to 50% of the actual project costs spent in the fiscal year for training and developing human resources for Vietnamese workers; or support up to 30% of the actual project costs spent in the year for R&D activities...
In particular, the Draft Decree stipulates support for initial investment costs. The subjects of initial investment cost support are enterprises with investment projects for R&D centers in the fields of semiconductor industry and artificial intelligence, with a maximum support level of up to 50% of the initial cost.
Of course, to receive support, investors and projects must meet the criteria set out in the Draft Decree. For example, to receive support for initial investment costs, businesses must meet the conditions on capital, investment fields, etc. and it must be an R&D center investment project that has a positive impact on the innovation ecosystem and the development of new technologies and breakthrough new products in the country.
Until now, Vietnam has only applied investment incentives based on income (mainly through tax exemptions and reductions). Now, with the establishment of the Investment Support Fund, these are incentives based on costs and include cash support - something that has never been applied in Vietnam.
“The United States, South Korea, India, China, European countries, and many countries in the ASEAN region such as Singapore, Malaysia, Indonesia, Thailand, etc. have applied diverse and attractive investment support policies, applied in parallel with income-based and cost-based incentives,” said Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc, adding that thanks to this, many countries have attracted large-scale projects in the high-tech sector.
Meanwhile, a report from the Ministry of Planning and Investment said that although foreign investment has continued to grow in recent years, the number of large-scale projects with high-tech content remains modest. Currently, Vietnam has 110 valid foreign investment projects with an investment capital of over 500 million USD, of which only 27 are in the high-tech sector. In the period from 2013 to present, there have been only 59 large-scale projects of over 500 million USD, an average of less than 5 projects per year.
The global minimum tax, which will be applied from 2024, will also affect Vietnam's competitiveness. Some businesses have considered new investment and expansion plans in Vietnam. Some large corporations have come to survey and research investments, but have not yet chosen Vietnam or are waiting to monitor the Government's policy response.
Therefore, the establishment and effective use of the Investment Support Fund is necessary. The National Assembly Standing Committee, when discussing the Draft Decree, agreed with this.
Open the door to welcome "eagles"
A delegation of American semiconductor businesses, including big names such as Intel, Ampere, Marvell, Cirrus Logic, Infineon, Skyworks… has just continued to visit Vietnam to seek investment and business opportunities. Among them, Mr. John Neuffer came to Vietnam for the third time as Chairman of the Semiconductor Industry Association (SIA).
Meeting with Prime Minister Pham Minh Chinh, Mr. John Neuffer once again emphasized that there are many new and great opportunities for American businesses in Vietnam. “SIA and American businesses will continue to accompany and support Vietnam in developing the semiconductor industry and building a strong supply chain,” said Mr. John Neuffer.
It is necessary to issue a Government Decree to ensure the attractiveness of the investment environment in Vietnam is maintained, meeting practical requirements and in line with international practices. 
- Mr. Le Quang Manh, Chairman of the National Assembly's Finance and Budget Committee
Having been to Vietnam and returned, that is the reason why Mr. John Neuffer believes that the investment plans of American semiconductor enterprises will continue to be implemented in Vietnam. Even during his visit to Vietnam at the end of 2023, Mr. John Neuffer mentioned that many American enterprises are ready to double their investments in Vietnam.
Giving advice to Vietnam, Mr. John Neuffer said that Vietnam not only needs a systematic strategy, but also needs breakthrough and outstanding mechanisms to attract investment. From this perspective, the establishment of the Investment Support Fund can create important impetus for Vietnam to welcome large investors and large-scale projects in pioneering industrial fields such as semiconductors and AI.
Opportunities are opening up, especially after billionaire Jensen Huang’s NVIDIA Corporation recently signed a strategic cooperation agreement with the Vietnamese Government on the establishment of the NVIDIA Vietnam AI R&D Center (VRDC) and the AI Data Center. Details of these plans have not been disclosed, but Minister of Planning and Investment Nguyen Chi Dung called this a “historic turning point”.
“NVIDIA's development of an AI Research and Development Center in Vietnam will be an important boost to help Vietnam make great strides in technology in the coming time, having a spillover effect on other high-tech investors in the world, especially in the field of AI, to invest in Vietnam,” said Minister Nguyen Chi Dung.
With the boost from NVIDIA and with outstanding investment support policies, Vietnam has become even more attractive to the "eagles".
“We hope that Vietnam will soon issue a decree on the Investment Support Fund,” said Choi Joo Ho, General Director of Samsung Vietnam, at a meeting with National Assembly Chairman Tran Thanh Man last weekend.
Samsung is also an “eagle”, with its investment scale in Vietnam exceeding 24 billion USD. In addition to the Samsung Display Project, which has just received an additional capital increase of 1.8 billion USD, Samsung will continue to increase its investment in Vietnam in the coming time.
Source: https://baodautu.vn/them-chinh-sach-dot-pha-de-don-dai-bang-d232540.html
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