Creating Best Legal Environment and Infrastructure to Serve Businesses

10:10:17 AM | 20/1/2021

Vinh Phuc province is continuing its efforts to improve the investment and business environment, and prepare conditions for infrastructure, premises and human resources to enhance investment promotion and attraction in the coming time. Mr. Nguyen Van Do, Director of the Department of Planning and Investment of Vinh Phuc province, had an interview with Vietnam Business Forum reporters about this issue. Ngo Khuyen reports.

How do you evaluate the promotion and attraction of Vinh Phuc province in the five-year period 2016-2020?

In 2016 - 2020, Vinh Phuc granted 265 new projects with a total investment capital of US$ 1,355 million, and adjusted to increase the capital of 202 projects by US$ 1,213 million; raising the total FDI investment for the whole period to US$ 2,568 million, (the targets were 100 projects and US$ 1,300-1,500 million). South Korea and Japan still came first in the number of new projects attracting and increasing capital; in the coming time, the investment capital flows from these two countries will continue to increase rapidly as Thang Long- Vinh Phuc Industrial Park phase 2 and Dong Soc Industrial park expand their operations. The presence of a number of new projects from countries such as the United States and Sweden also shows the potential to attract investment from new markets, especially Europe and the U.S.

Regarding DDI capital, the province has granted 223 new projects with a total capital of VND 47,179 billion, and adjusted 59 projects with an increase of VND 7,771 billion, raising the total DDI investment capital attracted in the whole period to VND 54,950 billion (the targets were 125 projects and VND 13,500 billion). During this period, many projects with large capital investment in social housing, industrial zone infrastructure, urban areas and eco-tourism projects have been attracted.

Thus, more than 20 years after re-establishment (1997), Vinh Phuc is one of the provinces achieving remarkable results in attracting direct investment with 1,245 projects including 447 FDI projects with a total registered capital of US$ 6,039 billion and 798 DDI projects with total capital of VND 96,560.7 billion.

 This result is thanks to the province's implementation of many mechanisms and policies to create an open, fair, and transparent investment and business environment, creating favorable conditions for investors. Investment promotion has been organized and mobilized methodically, with clear directions, programs and plans. The management of granting, adjusting, and terminating FDI projects has complied with the regulations and orientations for socio-economic development.

However, investment attraction still revealed a number of limitations, for example: not attracting many high-tech projects; the amount of technology transferred was still low; most technology of the projects was at average and medium-high levels, the foreign investment projects were still mainly processing products for export, and some projects consumed a lot of energy. The province will focus on adjusting and overcoming these limitations in the coming time.

In the period 2020-2025, will the province focus on attracting investment in any particular sectors, fields or areas; what is the ideal project size and quality?

In terms of industries calling for investment: The province will give priority to attracting projects using high, advanced, and environmentally friendly technology to create products with great added value, participating in the higher stages of the global value chain. The fields prioritized to attract investment are: mechanical industry, including manufacturing automobiles, motorbikes, components and spare parts production to support automobile and motorbike manufacturing industry; electronics industry and supporting industry for component production, electronic equipment, and new material production projects. Others include processing and manufacturing industries serving agriculture and meeting international standards, high-tech agriculture, high-value agriculture; medical equipment, healthcare, education and training, high-quality tourism, financial services, logistics and other modern services; and projects to develop technical infrastructure, renewable energy, and smart energy.

Regarding investment attraction by localities and territories:

- Attracting investment in accordance with planning (overall plan, national, regional and local sectors), ensuring economic - social - environmental efficiency, especially efficient use of land and non-renewable resources; not attracting investment at all cost, disrupting planning, and not attracting low-value projects per unit of land.

- For some localities and areas related to national parks, special-use forests, protection forests, and national defense, investment attraction will be closely considered, security and defense issues, the environment must come first.

- Some areas with the potential to develop industry, agriculture and services with favorable technical infrastructure such as Vinh Yen, Phuc Yen, Binh Xuyen, Vinh Tuong and Yen Lac will focus on attracting high-tech projects, new and advanced technology and modern services. The more difficult areas such as Song Lo, Lap Thach, Tam Dao, Tam Duong, besides tourism development projects, need to attract projects that employ unskilled and simple labor to promote employment and socio-economic development.

- Focusing on production projects in industrial parks and clusters; ensuring the occupancy rate of industrial parks and clusters, avoiding wasting land and breaking the general plan; planning a number of concentrated production zones for the development of high-tech agriculture.

- Studying and issuing mechanisms and policies to attract strategic investors and transnational companies to invest in new industrial zones when favorable conditions are met.

- Diversification, multilateralization to attract investment from many markets, focusing on traditional markets such as Japan, South Korea and expanding G7 countries to attract high-tech projects, new technologies, modern service with high spillover effect. Large domestic corporations with prestige and financial capacity have successfully invested in the province; actively seeking, connecting and calling to learn the investment environment and investing with multinational corporations and large domestic enterprises.

Regarding the quality scale of the project:

- Actively monitoring and evaluating the trends of shifting foreign investment flows into Vietnam from a number of countries in the region to select and attract suitable projects.

- Attracting foreign investment from small and medium-sized enterprises, micro-projects, but ensuring the technological conditions, joining the global production network and value chain, developing supporting industries, enhancing production capacity and developing new industries and occupations, creating more jobs.

- Attracting large-scale projects with high-tech content, efficient land use, and environment-friendly, Vinh Phuc will prioritize attracting large-scale FDI projects into breakthrough and key industries, the focus includes the fields of automobile, mechanics, electronics, tourism and service; manufacturing and processing industry; high-tech agriculture.

In order to catch the trend of integration and the global investment shift in the coming time, what conditions is Vinh Phuc province preparing?

Vinh Phuc province has prepared a number of conditions, including: Consolidating a number of units to establish “an investment promotion agency under the Provincial People's Committee”, this agency will be under the responsibility of a leader of the Provincial People's Committee, so that promotion and the support of investors can be convenient and fast; the modernization of investment promotion - including the scope of investment promotion activities, the approach, tools and indicators of FDI performance used; Strengthening cooperation with international organizations on investment promotion, foreign ambassadors in Vietnam; Foreign Commerce and Industry Chambers in Vietnam; Training and attracting overseas educated human resources to do investment promotion; Introducing "Business Environment 4.0" corresponding to business needs in the digital age; Improving institutions and policies, completing the current legal framework, investment incentive policies, and shifting to efficiency-based incentives; Developing a strategy to attract short-term, medium-term and long-term investments; attracting selective investment, giving priority to projects with high technology and friendly with the environment; Combining investment promotion with trade promotion and tourism in major seminars and events of the province; Building and completing good quality technical infrastructure for investment.

Along with the effective implementation of the Prime Minister's instructions on "3 companions, 5 supports" for enterprises, Vinh Phuc is determined to continue to improve the business and investment environment, to achieve the goal of 3 goods, including a good legal environment, good technical infrastructure and good business service.

Vinh Phuc's market entry index in 2019 increased sharply from 6.76 points to 8.65 points, ranking 1/63 of provinces and cities. In order to continue to improve the score and maintain the rank, what solutions has the Department of Planning and Investment been advising and implementing?

According to VCCI's assessment, in 2019, the market entry index of Vinh Phuc has significantly improved with all 10 index components reaching 8.65 points, up 55 places and 1.89 points compared to 2018. This index is assigned by the Provincial People's Committee to the Department of Planning and Investment to be responsible for monitoring and evaluation, this is an indicator that reflects the satisfaction of businesses on a number of procedures such as: Business registration, completing necessary procedures to initiate a business, openness and transparency of business registration procedures, professional knowledge and attitude, and the ability to apply information of business registers agency. This is the result of the determined efforts of the Department of Planning and Investment and related agencies in dealing with administrative procedures in business registration. The transfer of administrative procedures for business registration to the Public administrative service center, well implementing transparency, minimizing time and costs for businesses and enhancing the application of information technology, handling business registration procedures for level 3 and level 4 have been highly appreciated by enterprises.

In the coming time, the Department will continue to advise the Provincial People's Committee to develop and implement the plan to maintain the PCI of the province, including improving the quality of the 10 components of the market entry index; increasing the application of information technology, striving to achieve over 80% of business registration procedures at level 4 by 2021; and improving service quality to increase businesses’ satisfaction.

Source: Vietnam Business Forum

Forthcoming Events