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Investment

Last updated: Monday, June 18, 2018

 

Dedicated, Dynamic and Creative in Attracting Investment

Posted: Monday, June 11, 2018


Over the past time, Ho Chi Minh City has been voted by the business community as one of the best business environments in Vietnam and has achieved great success in attracting investment, becoming the leader in attracting foreign direct investment (FDI), thanks to its efforts to accelerate reforms of administrative procedures to create open mechanisms; reflecting feedbacks and aspirations of enterprises and investors in its policies that are innovative to attract more investment resources. Ms Le Thi Huynh Mai, Deputy Director of the Department of Planning and Investment of the city, shared with the Vietnam Business Forum about this proud achievement. My Chau reports.

Could you tell us more about the city's achievements in attracting FDI since Vietnam started attracting foreign investment in 1988?
In 2017, Ho Chi Minh City achieved very positive results in attracting FDI, exceeding the target set with the total investment capital of US$6.6 billion, up 74.86 per cent compared to that of 2016. Particularly, in the first quarter of 2018, the city attracted US$1.37 billion, twice that of the same period and nearly one third the national figure. In the period from 1988 to the end of the first quarter of 2018, Ho Chi Minh City had 7,633 valid FDI projects with the total registered capital of US$44.73 billion, helping the city to maintain its position as the leading city in attracting FDI.

As one of the focal points for investment management in the area, the Department of Planning and Investment will strive to get the best results in 2018.

In order to attract good FDI, in the past time, how have you carried out investment promotion in other countries?
In 2017, the city carried out investment promotion overseas with outstanding activities such as organising business delegations to the Asian Financial Forum (AFF) 2017 in Hong Kong; organising business delegations to Australia, New Zealand; organising trade & industry promotion programmes to Singapore and Malaysia. These activities contributed to promoting the image, the potential development of trade, investment and tourism of Ho Chi Minh City, introducing the investment environment and investment incentive policies of the city to foreign enterprises and international organisations. At the same time, it created opportunities for local enterprises to meet and discuss with investors about investment cooperation opportunities.

Ho Chi Minh City also provided information on potential markets to help Vietnamese businesses actively access and expand their markets, especially markets of the countries participating in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the ASEAN Economic Community (AEC), the Free Trade Agreements (FTAs) such as Vietnam-Korea Free Trade Agreement (VKFTA), the Vietnam-Eurasia Economic Union Free Trade Agreement (VN-EAEU FTA), etc. The city also developed a database for investment promotion, including information of local projects calling for investment, investment incentive policies, legal provisions on investment, investment procedures in other countries; developing a market profile of each country to facilitate foreign visitors to learn about the local investment environment. Ho Chi Minh City has now established the market profiles of 20 countries, including Japan, Korea, China and the USA.

In addition to taking solutions to further improve the investment environment, Ho Chi Minh City also introduces the favourable investment environment such as high technology, good supporting industries; the sectors having high levels of intelligence and added value; especially in the field of high technology and supporting industries for hi-tech development; focus on calling for investment in projects under the list of investment promotion of the city. With its tireless efforts, Ho Chi Minh City has attracted investments into local priority fields with typical projects such as KNT Asia (US$215 million), Tech Mastery Vietnam Ltd. (US$80 million), and Cau Tre Food Processing Factory (US$53.33 million).



Achievements of Ho Chi Minh City in attracting FDI reflect the spillover effect of strong reforms of administrative procedures. Could you elaborate on this support mechanism?
As mentioned above, the encouraging achievements in attracting FDI in recent years reflected the efforts to continuously improve the investment environment of the city, including the enhancement of administrative reform, support for development of FDI enterprises. The Department of Planning and Investment has taken many practical measures to improve the business and investment environment, and create favourable conditions for enterprises. Specifically, the Department has reduced the time of processing investment registration procedures by 30 per cent compared to the total time as prescribed by law. With regard to the procedures for registration of enterprises, the Department of Public Administration Reform incorporates three procedures for registration of establishment of enterprises, notification of seal samples, and notification of bank accounts in one submission and return of dossiers. This combination reduced the duration of the administrative procedure from nine to four working days, equivalent to a reduction of 55.5 per cent of processing time.

In addition, the Department also intensifies the use of IT in dealing with administrative procedures through the implementation of investment procedures online. After officially launching from November 1, 2016, up to April 2018, the Department of Planning and Investment had successfully received and processed 2,984 applications for online registration. For business registration procedures, the Department mobilised human resources to instruct and directly process the online application and return results at home. Up to now, there have been nearly 179,048 business registration dossiers submitted online at home that have been successfully processed by the Department. Especially for the settlement of administrative procedures for large projects, land use projects - which are projects that have a certain influence on the economy of the City, Ho Chi Minh City has decided to direct the breakthrough model. Due to the complex nature, these projects often have to go through various procedures due to various legal regulations. It is, therefore, very time-consuming to put the project into official operation. To overcome these inadequacies, on December 29, 2017, the City People's Committee issued Decision 6724/QD-UBND to establish and issue the working regulations of the inter-ministerial working group on investment by the Chairman of the City People's Committee being the leader; to focus on big and key projects with great impacts on the city's economic growth. The establishment of interdisciplinary working group is to ensure the receipt, evaluation and licensing of investment in the most effective way. In order to implement the above Decision, the Department of Planning and Investment will coordinate with other departments to reduce by at least 50 per cent the processing time compared with the time of processing investment projects in the city today. At the same time, the Department will coordinate with other departments to propose and set up clear time for each processing stage.

At the same time, the city continues to maintain and complete the inter-sectoral working group on construction licensing; promote the implementation of the electronic single window mechanism in the granting of construction permits. In other fields such as taxation, insurance, labour, customs, etc., the PAR has continued to be strengthened, such as a sharp reduction in customs clearance time for imports and exports equal to ASEAN + 6; 50 per cent reduction of customs clearance time, ensuring 98 per cent of businesses implement e-tax declaration; fully apply IT to electronic transactions on procedures for granting social insurance and health insurance.

Not only "directing", the City always "listens" to aspirations of enterprises, investors and people. The investment promotion is enhanced by maintaining the dialogue channel with investors to timely solve problems and obstacles for investors, to exchange views and opinions of investors and enterprises in order to promptly propose solutions to remedy outstanding problems and create the most favourable conditions for investors.

What are the priority areas to attract FDI in Ho Chi Minh City in the future? In order to create an open, friendly and safe environment for investors when coming to Ho Chi Minh City, what is the focus of the city?
Currently, the city is calling for investment into nine key services and four key industries. In the field of agriculture, priority is given to investment in biotechnology, gene breeding and seeding. In the field of urban development, it focuses on urban transport; flood control and fresh water supply, modern information infrastructure; development of new urban centres, hi-tech parks, industrial parks and export processing zones (EPZs).

Ho Chi Minh City has long been considered an active city in setting up outstanding and innovative policies to attract more investment. In recent years, many international cooperation activities of the city have become vibrant, effective and synchronous on all channels from the Party and State externalities to people's diplomacy. Many economic, cultural and social achievements have confirmed the position of Ho Chi Minh City as one of the most dynamic economic centres of the country. Promoting this success, in 2018, the city will pay attention to further improving the quality of investment and business environment; focusing on attracting FDI in depth to improve the quality of FDI. Specific solutions will be implemented including: Improving the quality of investment promotion; promoting on-the-spot investment for enterprises; strongly improving the investment environment, the competitiveness of the city; improving the quality of human resources; upgrading and enhancing the operational efficiency of the Trade and Investment Promotion Centre; strengthening the coordination mechanism between the focal points assigned to attract FDI by the city to review the list of possible investment, solutions to attract investment in priority sectors, areas, infrastructure investment to serve the investors.

Thank you very much!








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