The Covid-19 pandemichas been influencing the decisions on expanding investment of foreign enterprises in Vietnam. Talking with reporters of Customs Newspaper, HONG SUN, Vice President of the Korean Chamber of Commerce and industry in the South & Middle of Vietnam (KORCHAM) said foreign enterprises in Vietnam still need to expand investment, so it is necessary to facilitate enterprises to overcome difficulties and eliminate hindrancestothe investment and development process.
How do you evaluate the Korean enterprises’ investment expansion in Vietnam today?
– Despite the negative impact of the pandemic, Vietnam is still an attractive investment destination for Korean businesses in particular and foreign businesses in general. Therefore, many Korean enterprises and large corporations still have the need to expand their investment in old projects and implement new projects.Korean businesses are exploring, expanding investment in the financial market andleading securities companies, in the form of indirect investment such as shares andstocks or focusingonkey projects that interest the two governments. Regarding direct investment, many firmshave expanded factories and production facilities to enhance their business capacity and anticipate the opportunities that Vietnam brings.
The activities have not really “blossomed” to theirpotential. In your opinion, what is the reason for this?
– The biggest factor affecting decisions on investing more and expanding projects is the travel of experts and enterprises due to the impact of the Covid-19 pandemic. The routes are still available but foreign experts entering Vietnam have to isolate and undergo strict medical examinations and the quarantine period can be up to half a month to a month. Therefore, only enterprises whose workforce is available in Vietnam can implement plans smoothly, otherwise it will be very difficult.
For example, recently, a Korean corporation wantedto invest an additional 300-400 million USD in the electronics sector in Vietnam, after having successfully invested more than 100 million USD in the past. However, to implement the projects successfully, a team of ten to hundreds of Korean experts must travel to Vietnam, which costs much for travelling and the 14-day isolation. Therefore, Korean enterprises should still wait a while longer depending on the progress of the disease to have a more reasonable method.
What should Vietnam do to draw more investors into Vietnam?
– Vietnam has always been an attractiveinvestment destination for Korean businesses and they are expanding further investment here. T Government needs to create more dynamic atmospherewith positive information to stabilize investor sentiment. Moreover, Vietnam needs to “take care” well for businesses that have been investing in Vietnam, especially those that have been successful. The initial success in phase 1 projects will give them motivation and prospects for the next stage. Furthermore, successful foreign businesses in Vietnam will help communicate and promote the investment and business environment with international partners, business partners and colleagues with the message “Vietnam is the key to success”.
However, investorssometimes get into trouble with some unreasonable regulations on business conditions orthe negative attitudes of some government officials such as ironical harassment which will strongly affect the reputation of Vietnam as well as investment trends of foreign enterprises in general and Korean enterprises in particular.
These problems show that investors need many factors for development and expansion. Therefore, the Government of Vietnam also needs to improve its policies and facilitate procedures for foreign enterprises to overcome difficulties in the current pandemic context. Because not only domestic enterprises but also many foreign firms face difficulties in this social context, there must be preferential policies for healthy enterprises but temporarily difficult to afford to develop without affecting the workforce of enterprises.