Boosting Investment Attraction and Business Support

10:57:05 AM | 9/10/2023

An Giang province has established itself as a destination for many domestic and foreign corporations, thanks to its highly appreciated investment environment. Mr. Pham Minh Tam, Director of the Department of Planning and Investment of An Giang province, shared the province’s investment attraction results and its efforts to support companies and improve the business investment environment.

Dong Thap Provincial Trade, Tourism and Investment Promotion Center and An Giang Trade and Investment Promotion Center sign a cooperation agreement to promote trade, investment, and tourism for the period 2022-2025

Could you please tell us about investment attraction results of An Giang province in recent years?

As of August 2023, An Giang province licensed 658 investment projects, including 619 domestic direct investment (DDI) projects with a total registered fund of VND105,686 billion (US$4.56 billion) and 39 foreign direct investment (FDI) projects with US$305.9 million from 15 countries and territories. South Korea was the biggest investor with 11 projects with US$103 million, followed by China with 5 projects and US$39 million, Japan with four projects and US$21 million. The rest came from investors in Thailand, the UK, Denmark, Canada, Germany, Singapore, the Philippines, Switzerland, Israel, Malaysia, Finland and Samoa. They created jobs for 16,800 workers.

Investment projects have made important contributions to the province's socioeconomic development. An Giang's average annual GRDP growth in the 2021-2023 period was estimated at 5.08%, especially in 2023 when the GRDP growth was 7.5%. The economy was restructured towards a positive pattern. The agriculture, forestry and fishery sector accounted for 33.99%; the industry and construction sector made up for 16.90%; the trade and service sector contributed 45.70%; and the net tax revenue accounted for 3.41%. Total social investment capital in the three years from 2021 to 2023 was forecast at VND98,168 billion (US$4.23 billion), reaching 60% of the target stated in the resolution of the 11th Provincial Party Congress. The export value in 2021 - 2023 was estimated at US$3.47 billion, equal to 66% of the target.

How have global economic and political developments affected social and economic performance and investment attraction of An Giang province?

As a highly open economy, recent world economic fluctuations exerted a significant effect on Vietnam’s economic performance, including An Giang province. Specifically, the world economy fell into a slight recession and high inflation led to a decrease in world consumption demand. The global market demand for leather and footwear products shrank, forcing leather and footwear companies to downsize their operations and lay off their employees, thus placing increased pressure on the social security system. The market demand for commodities increased slowly, resulting in low growth of credit capital and social investment capital demand.

In addition, increased prices of essential commodities and input materials seriously hit companies. Unstable construction material prices are hindering many key projects and public fund disbursement.

In the face of rolling difficulties, many companies had to terminate operations, or cut personnel or reduce working hours. Meanwhile, investors waited for new mechanisms and policies to seize new investment and business opportunities, resulting in a substantial decline in registered large-scale projects as compared to a year earlier.

In the year to late August 2023, the province received applications for 17 new investment projects with VND28,139 billion. By the end of June, An Giang licensed five projects with VND172.1 billion and ratified bidding rounds to select two projects with VND24,043 billion of investment capital.

Given such adversities, the economic growth of An Giang province was only 6.5% in the first half of 2023, below expectations. However, this was a great effort of An Giang province amid global economic slowdown.

Before these difficulties, what solutions has An Giang province taken to support businesses, attract investors and boost economic recovery?

To attract more investment flows, the Department of Planning and Investment advised the Provincial People's Committee to propose the central government to consider and issue specific mechanisms and policies to draw strong investment flows into the An Giang Border Gate Economic Zone to create new momentum for regional development investment, especially border economic development.

In addition, to focus on improving the business investment environment, remove difficulties and obstacles, support companies to accelerate recovery and development, the department advised the Provincial People's Committee to launch many plans and solutions like carrying out main tasks and solutions for a better business environment and stronger national competitiveness in 2023 together with raising the Provincial Competitiveness Index (PCI); surveying and assessing departmental, sectoral and local competitiveness in An Giang province in 2023 aimed to enhance the quality of economic administration at all levels; and establishing a special working group responsible for reviewing and removing obstacles against enterprises and supporting them to carry out their investment projects in An Giang.

The investment and business climate of An Giang has significantly improved in recent years but its PCI rankings have not advanced as expected. What do you think about this situation?

Observing the PCI performance in the last four years, the Department of Planning and Investment found that, despite the province’s ongoing efforts, the PCI Index and its components are still not stable and sustainable year after year.

However, the decrease in PCI subindices did not mean that no effort had been made. Perhaps, the effort was not meeting the expectations of local enterprises, or its peers had a more effective effort and obtained better outcomes. Essentially, we need to have objective assessments to seek solutions for a better performance after each decline.

So, what key solutions will An Giang province take for a better investment and business environment and a higher PCI in the coming time?

After the PCI 2022 was announced, the department asked the Provincial People's Committee to issue Plan 409/KH-UBND dated May 24, 2023 on organization of a conference on the province’s PCI and DDCI results in 2022. At the conference, attending agencies which are responsible for addressing existing shortcomings proposed tasks and solutions to improve weak indicators to raise the PCI Index as well as its subindices and enhance the business and investment environment. Based on agreed contents at this meeting, the department drafted a plan on tasks and solutions for a better business environment and competitiveness to draw more investment flows in 2023 and beyond as follows:

First, the Department of Planning and Investment will work other agencies and localities to consult the Provincial Party Committee and the Provincial People’s Council to issue a thematic resolution on "stepping up administrative reform, improving the investment environment, enhancing the provincial competitiveness, attracting investment capital and supporting businesses” to 2025 to create consensus and unity in direction, administration and implementation of the whole political system.

Second, preparing ready conditions for new investment flows: Available land and space; available essential infrastructure (transport, port, worker housing, vocational education and training facilities, electricity and water); available annual resources (from unskilled workers to skilled workers) to meet enterprises’ needs; quick settlement of administrative procedures for businesses and increased business satisfaction; ready support for investors to survey the project location and operations.

Third, building a modern, professional, dynamic administration that best serves people and businesses.

Fourth, further raising provincial competitiveness by improving PCI, PAPI, PAR Index, SIPAS and DDCI; caring about public satisfaction in administrative procedure reform; facilitating people and businesses to give their opinions to and supervise policymaking and enforcement, especially in delivery public services and business support.

I believe that, with political determination, especially with strong innovations and actions, the investment and business environment of An Giang province will be better in 2023 and beyond.

Thank you very much!

By Viet Van, Vietnam Business Forum