Vietnam Records many Reforms but Still Slow Compared to Regional Countries

So as you can see, Japanese investment in Southern provinces is increasing due to the improvement of infrastructure, human resources and investment environment in those localities, especially Binh Duong and Dong Nai provinces.

 

 

Although you have made big progress compared to 10 years ago, it is still slow compared to the region. In the past 10 years, countries such as Thailand and Singapore have advanced far ahead of Vietnam. To compete in the globalized economy, you must change stronger and faster.

I do not understand why you should continue the discrimination between local and foreign enterprises, paying more attention to minimum salary at FDI enterprises, seemingly caring for only the interest of these workers, or why the law has been amended by the central government, but local authorities apply it differently from region to region.

I highly appreciate the round table meetings. It was first organised in 1998 by then Vice-Chairman Le Thanh Hai. Mr Hai was very active and the conference has been organised every year. It helps HCMC People’s Committee improve and make recommendations to the central government on upgrading the investment environment.

The Japanese assistance programme includes grant aids, ODA loans and technical cooperation. A grant aid was provided to upgrade Cho Ray hospital, Vietnam-Japan Human Resources Development Centre, support the faculty of Agriculture and Can Tho University. ODA loans were leased to such projects as Ham Thuan - Da Mi Hydro Power Station, Saigon East-West highway and Tan Son Nhat Airport. By the end of March 2005, the Japanese government had also provided grant aid to Southern NGOs and localities with 74 development projects worth some US$4.9 million.

Japan’s overseas cooperation volunteers have also been implemented in such areas as agriculture, culture and sports, training human resources for Vietnam through community activities.

 

All Japanese investors wish that the Vietnamese side to implement all the content of the Japan-Vietnam Joint Initiative and the Japan-Vietnam Investment Treaty. What we are interested in most is that the Vietnamese side has improved the local investment environment but the interest of investors should be protected better. This is a way to call for more investors in the future. At the same time, the Vietnamese Government should concentrate on guiding the implementation of new ordinances and legal documents to gain a unique implementation of localities and enterprises.

 

Regarding to the new investment law of Vietnam, there are two things I am very interested in. Firstly, there is not any discrimination between State-owned, private and foreign-invested enterprises. This will create equality and fair competition. Secondly, there is not any control in cost prices of products. This will help enterprises have more autonomy in their business management, thus becoming more familiarised with the market economy.

At present, the steel and iron industry is in a difficult period. Our production capacity is six million tonnes per year but the market demand is just 3.3 million tonnes per annum. Also, competition among enterprises in the industry is fierce. I propose the government to remove material import tax for the steel and iron industry as a tax rate of five per cent produces significant impacts on cost prices of products.

 

A sudden decision by the Vietnamese Government on increasing minimum wages of workers at foreign-invested enterprises is not good. We agree on an increase in the minimum wage but the Government should adjust it periodically, instead of a sudden increase after around eight years. This is because an increase in wages of workers will produce a chain impact on enterprises employing many workers.

Regarding the investment environment, I think that Vietnam has more favourable conditions than other countries in the region. Shortcomings are that Vietnam's infrastructure facilities have yet to be good and prices of water and electricity remain high. For Japanese investors, top investment destinations include China, Vietnam and India.

 

Japanese investors, who go to Vietnam for seeking opportunities, talk about a need of a transparent and clear legal system. In particular, in the banking industry, the Vietnamese Government should consider expanding operation of foreign banks' branches. This will help branches operate more effectively, creating an equal competition in the banking industry and helping foreign investors in Vietnam.

 

Vietnam-Japan Human Resources Co-operation Centre (VJCC) is a JICA-sponsored project on human resources development for Vietnam. One of the shortcomings is that Vietnamese young people have yet to be trained in depth in concrete fields. Their foreign language skills, in particular Japanese, remain poor, incapable of meeting the requirements of Japanese companies. Therefore, we are striving to organise training courses in Japanese and Japanese style for students.