Last updated: Monday, April 24, 2017
Haiphong-Strategic City for InvestorsPosted: Tuesday, March 28, 2017
In the framework of the Japanese cultural exchange in Haiphong City, a seminar on Japanese investment and tourism promotion was kicked off in the northern port city. On this occasion, the Vietnam Business Forum has an interview with Mr Le Tri Vu, Director of the Haiphong Investment, Trade and Tourism Promotion Centre, on the city’s investment attraction from Japan. Le Hien reports.
How has investment attraction been in Haiphong City?
With a series of synchronous and modern works from airway (Cat Bi International Airport), roads (Hanoi - Haiphong Expressway) and seaports in service, Haiphong City now has 486 FDI projects with a total registered investment of nearly US$14 billion from 36 countries and territories. Japan has 130 projects with US$4.14 billion, standing first in projects and second in value. There are about 500 Japanese experts living and working in the city in addition to thousands of rotational specialists. Japanese companies have become an important part of the city’s economy. Japanese businesspeople have become the city’s close friends. The city has also received official development assistance (ODA) from the Government of Japan, helping the city to upgrade and complete technical infrastructure. Haiphong City signed cooperation agreements with six prefectures of Japan, which frequently exchanged visits with Haiphong City.
“Hard” traffic infrastructure has been relatively complete in the city, while the “soft” is the Investment, Trade and Tourism Promotion Centre set up at the end of 2016. Will this combination exert a strong pull on investment attraction in the city in the future?
The formation of the Investment, Trade and Tourism Promotion Centre affirmed Haiphong City’s determinations to improve the business environment to draw more investors and affirmed that this model was approved by the Prime Minister who wanted the city to be the first to carry out it. According to Haiphong Party Secretary Le Van Thanh, the potential and position of Haiphong City are huge enough to become the third largest city in the country. Therefore, the formation of the centre came from the urgent need in the new development stage with many pending investment projects, first of all calling investors to spend more than US$12.85 billion as promised at an investment promotion event in 2016. Many other investors have come to the city to explore business opportunities. For that reason, the establishment of the centre is believed to create a strong boost in investment attraction in Haiphong City since its top task is to care and serve investors well, persuade them to the city, quickly shape single-window mechanism for administrative procedures for investment and business affairs.
Although the government pledges to provide the most favourable conditions for investors, many FDI investors, including Japanese, still anxious about administrative procedures in Vietnam? What policies will Haiphong City take to win the trust of investors?
By locality, Haiphong City received the biggest value of FDI in 2016. This proved the appeal of the city and the trust of investors in the port city. VCCI President Vu Tien Loc affirmed that it is right time to invest in Haiphong now. The city has the best supporting industries in Vietnam and the largest seaport system while it lies near to China and easily reaches other countries by sea. If Japanese investors locate their production bases here to export to China and the region, this will be the Number One place. According to a JETRO survey in 2016, up to 66 per cent of Japanese companies doing business in Vietnam are seeking to expand their operations, compared with 44 per cent in China and Malaysia.
The Government of Vietnam and Haiphong City will give clear explanations to investors who are worried about rising labour costs (looking up 7.4 per cent in 2017), inconsistent legal system, and complicated administrative procedures relating to tax, customs, and social insurance.
Japanese companies are famous for high-tech machinery and equipment manufacturing and marine services. Thus, such industrial parks as Dinh Vu, VSIP and Trang Due will be the most attractive destinations to Japanese investors. The city is also urgently completing the scheme for construction of a specialised industrial park. This is a very good opportunity for Japanese investors to find out and decide on investment because the specialised industrial park will be an ideal place for supporting industries.