Why Vietnam is Always Attractive Destination for FDI Flows - Top Hidden Reasons


Socio-economic reform policy since the early 1980s has helped Vietnam from a low-income country to a stable middle-income country and has stable politics, trade relations with all countries in the world. These changes have made Vietnam an attractive destination for investors, creating many advantages in attracting foreign direct investment (FDI).


Fast and stable growth


Vietnam is located in Southeast Asia, one of the most developed and dynamic regions in the world today. In particular, with more than 3,000 km of coastline and located at the gateway of the region, Vietnam has many advantages in building and developing deep-water ports and global trade.

The tropical monsoon climate with two distinct climates and distinct seasons also gives Vietnam a lot of advantages in developing agriculture and becoming a relatively important supply source of agro-forestry and marine products for the region and the world.
After more than 30 years of innovation and application of market-oriented economy, Vietnam has achieved great achievements. The economy is growing at a relatively high rate compared to the world and regional.

Despite constantly facing uncertainties and challenges as the world economy has experienced a period of recession for the past 10 years, Vietnam has maintained an average GDP growth rate of over 6% per annum. The Vietnamese government is confident of setting a high middle-income country by 2035, with an average growth rate of 7% in the coming period.

High and stable growth over the years has always been a attractive investmentd estination for investors, at the same time helping Vietnam to improve its competitive position in attracting investment capital compared to other countries in the region.

In addition to the economic achievements, Vietnam has also been very successful in maintaining the stability of other macroeconomic indicators. Inflation rates in recent years are well under control at less than 5%. Foreign exchange rates are always maintained at a stable level, no abnormal fluctuation affects the economy. Credit growth has also been tightened.

The rapid rise of the middle class over the years has also been an important contributor to economic growth, particularly in the consumer and retail sectors, as they are a powerful consumer force have education level and the needs to improve the quality of life. This is also the main driving force in turning Vietnam's domestic consumption market into one of the most attractive markets.

To date, Viet Nam's population is close to the 100 million, ranking 14th in the world, about 60% of the population under the age of 35. This is a young, healthy, dynamic and potential labor force having ability of accessing advanced knowledge to meet fast-changing economy, especially when the 4.0 industrial revolution is booming.
However, labor costs in Vietnam are still relatively low compared to similar income countries, so it will continue to be a significant competitive advantage for Vietnam in the near future, especially in the consumer goods manufacturing sector and labor intensive goods.

Vietnam's continued maitaining market-oriented economic policies, and increased integration with the world, will bring many advantages for investors to access the world market.

Vietnam has signed a number of bilateral and multilateral free trade agreements (FTAs), such as the Bilateral Trade Agreement with the United States, South Korea, the European Union (come into effect in 2018), to become full member of the World Trade Organization (WTO), joining the ASEAN Economic Community (AEC), ... and is continuing to negotiate in many other trade agreements.

This affirms Vietnam's increasingly important role and position in the global economy, as well as its determination to integrate and adhere to the rules of international trade.
The market is highly competitive

In order to achieve the economic and political results mentioned above, Vietnam has faced many difficulties and challenges such as: transparency in business is still low, It still takes time and effort for investors, ...

The role of the Government in promoting Vietnam's advantages and overcoming challenges is of utmost importance. In addition to boosting economic growth, the current tenure of the government has shown its determination to create favorable conditions for businesses to operate in an environment of equality and fair competition.
The Government has taken the policy and implemented resolute actions through resolutions on improving the business environment and supporting the development of enterprises.

In addition, the Government of Vietnam is implementing many policies to enhance national competitiveness and at the same time to restructure the economy and transform the growth model, focusing on restructuring public investment, state-owned enterprises and financial-banking systems.

In addition to continuing to implement preferential policies for attracting foreign investment such as corporate income tax exemption, import tax exemption for some commodity lines, exemption from land rental and land use fees, etc. The Government also committed to continue to reform administrative procedures to create favorable conditions for investors.

World Bank reports acknowledged Vietnam's efforts in reforming administrative procedures, particularly those relating to the performance of tax obligations. Specifically, the Ministry of Industry and Trade recently reduced and simplified 675 business conditions under its management.

In short, despite many challenges and difficulties, Vietnam is still considered a highly competitive market, with stability in terms of social security and attractive growth.
The situation of attracting foreign direct investment in Vietnam in the past two years is also very impressive, although the world has many unfavorable developments.
In 2016, registered FDI reached $ 27 billion and investment capital reached $ 15.8 billion, an increase of about 11% over the previous year. In the first nine months of 2017, Vietnam has attracted more than US $ 25 billion of direct investment. These impressive figures demonstrate the attraction of Vietnam to investors in the past, present and future.

In addition, the presence of highly reliable, internationally-advised, well-informed, and internationally-experienced auditors will help investors to be confident in their investment decisions. and operate in Vietnam as they are able to assist foreign investors in complying with the requirements and regulations in Vietnam and to make the most of the benefits that the Government offers.

We are proud of being top five reliable company specializing in investment fields in Vietnam. Please contact us for inquiries via email info@fdi-vietnam.com  or call us directly at  + 04.32020505. Our official website: fdi-vietnam.com. Let us help your business in Vietnam.
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