We're ready for foreign investors, says Hanoi
HANOI - Vietnam's government said on Thursday it was taking sweeping steps to improve conditions for embattled foreign investors amid concern about a decline in new investment inflows.
A senior Ministry of Planning and Investment (MPI) official told a news conference that a
decree promulgated in late January was aimed specifically at addressing investment problems
and would make the system more liberal, transparent and supportive.
Nguyen Nhac, deputy MPI minister, said the new rules would ease bureaucratic obstacles,
improve regulatory consistency, and clarify details of taxation and the areas in which investment was encouraged.
``The Vietnamese government is now ready and we do hope that the business community
in Vietnam is also,'' he said.
Piecemeal details of the new investment decree were carried in Vietnam's state media
over the past two weeks and unveiled at an investor forum in Ho Chi Minh City earlier
this month.
Nhac described the decree as a ``first step'' towards improving the country's investment
environment, but conceded that it was aimed primarily at helping existing investors rather
than attracting new ones.
``We have a saying in Vietnam that when you use a bait don't end up catching its shadow,'' he said. ``We are trying to focus on those investors already in Vietnam.''
Vietnam's inflows of new foreign investment plunged last year amid growing frustration
over the communist-run country's business environment and new worries about the
regionwide economic crisis.
Varying official figures issued in January showed a decline of between 40 and 50
percent in foreign investment against 1996,when $8.6 billion was pledged.
MPI data released on Thursday pointed to an additional problem -- of the $32 billion
Vietnam has received in pledged investment since 1988, just $11.878 billion had been
implemented by the end of last year.
Nhac referred briefly to the impact of the regional crisis by saying Hanoi was trying to
find ways to make up for the reduction in capital from Asian investors, whom he said accounted for about 70 percent of the current total.
But he also talked optimistically of Vietnam's hopes of attracting inflows from elsewhere.
``We are not limited by a sole investment source or by region,'' he said. ``We are trying
our best to speed the mobilisation of investment from Europe, from Australia, from
the United States and from other countries.''
Hanoi opened its doors to foreign investors in the late 1980s following the introduction of
economic reform policies.
But the enthusiasm of the early 1990s has been badly dented over the past two years by
persistent regulatory and other impediments,corruption, low returns and a series of high
profile problem cases.
The most recent of these involves U.S. consumer products giant Procter and Gamble
which is locked in a dispute with its local partner over responsibility for losses at their
Vietnam venture.
By Adrian Edwards (REUTERS News Service) - Feb 12, 1998.
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