Attracting FDI: New Regulations, New Face

The strategy to attract foreign direct investment (FDI) in Vietnam from now to 2030 with many new points is attracting special attention of investors.

The perspectives of the Ministry of Planning and Investment in developing a strategy to attract FDI capital for the coming period are to selectively attract and focus to increase the efficiency of FDI’s contribution to economic growth in the context of deeper international integration with the implementation of a series of new free trade agreements.

Accordingly, the orientation to attract FDI in the coming period is to prioritize capital flows into high-tech, new and environmentally-friendly industries such as information technology, electronics, telecommunications, automobiles and agricultural machines, construction equipment, industrial equipment, electrical equipment, supporting industry, internet of things (IoT)…

Other priority areas include: processing and manufacturing industries for agriculture to meet international standards, high-tech agriculture, high-value agriculture, medical equipment, health care, education and training, high quality tourism, financial services, logistics and other modern services; developing technical infrastructure, clean energy, renewable energy, smart energy.

At the same time, Vietnam will continue to attract FDI into industries with advantages such as textiles and garments, leather and footwear…, but priority is given to high value-added stages, associated with smart production processes, automation.

Vietnam aims to attract high quality and more efficient use of FDI to access new technologies, increase connections between domestic and foreign enterprises, increase participation in global value chains, contributing to increase the country’s competitiveness and promoting economic restructuring according to the change of growth model.

Vietnam also aims to increase the contribution of the FDI sector to 20 – 25% of the total investment capital of the economy, reducing the energy consumption of FDI enterprises below the national average while increasing the contribution of this sector in GDP growth in the coming period.

The often-changing legal framework is the concern of investors. Law enforcement should be improved to reduce difficulties for businesses when the new law takes effect. Many foreign investors leave China because of this reason and this trend will continue. How attractive Vietnam is depending on the future policies of the Government and enforcement agencies.