Vietnam offers attractive investments KUALA LUMPUR - Vietnam, one of the 10 new emerging markets in the world, has invited Malaysian companies to invest in infrastructure projects such as roads, harbours, communications and transportation. Its ambassador to Malaysia, Tran Trong Toan, said other equally attractive areas such as high technology and export industries, agriculture, forestry and aquaculture, labour intensive industries were available. Tran also said Vietnam would appreciate investors who could invest in mountainous and far-flung regions as well as areas that were disadvantaged in socio-economic conditions. "We are encouraging these investments by giving incentives such as concessional taxes like import tax, overseas profit transfer tax and exemption or discount on the land lease fees,'' Tran said in a talk on Vietnam: Challenges and Opportunities, organised by the Asian Pacific Development Centre (APDC) in Kuala Lumpur yesterday. With 70 projects involving capital investments totalling US$941mil in Vietnam, Malaysia's investment is ranked third among Asean countries after Singapore and Thailand and 12th among foreign investors. With an area of 331,700sq km, the multi-religious Vietnam has 80 million people with a literacy rate of 92% in 1997. Considered a developing country with an annual per capita income of below US$1,000, Vietnam has targeted a GDP growth rate of 5.5% to 6% this year and an inflation rate at 6%. The agriculture-based Vietnam is rich in natural resources for continuous production for domestic and export markets. On the political front, the country is enjoying a high level of peace and stability. Since 1986, it had implemented the renovation cause of the Doi Moi, culminating in more economic openness and liberalisation that had been well received by the international community. The Doi Moi has resulted in private economic businesses which are now eight times larger than state-owned businesses and contributed 50% of the country's annual GDP. Vietnam is also in the process of deregulation and building various institutions for a multi-sectoral market economy, integrating itself into the world by joining Asean, Afta, Apec, Asem and preparing for accession to the World Trade Organisation (WTO). According to Tran, the law on foreign investment in Vietnam, which is considered one of the most favourable in the region and which was amended last month, guarantees fair treatment towards foreign investors and various forms of investments are allowed such as joint ventures, business cooperation contracts, projects with 100% foreign investment and on the build, operate and transfer basis. On bilateral trade, Tran said there was a considerable increase in the past few years. In 1990, the trade volume was just over US$50mil and this had increased by more than tenfold to US$638mil in 1999. He said the level of bilateral trade was still modest compared to the two countries' cooperation potential. Malaysia's trade with Vietnam accounted for just 0.1% of Malaysia's trade with the rest of the world. The trade balance favoured Malaysia with an export of US$390mil in 1999 and imports of US$248mil. "To increase and balance the bilateral trade, it wishes Malaysia would import more agricultural products such as rice, groundnuts, cashew nuts, vegetable and aquatic products and consider new items like beef, poultry, pork and other livestock,'' Tran said. "With the recovery of Malaysia's economy, it is hoped the Malaysian investment in Vietnam will increase. Malaysian businessmen are seen as serious and active in doing business with Vietnam and are thus appreciated there. By Bernama - The Star - June 20, 2000.