Vietnam Remains Priority Investment Destination of Korean Businesses

Korean businesses continue to focus on the Vietnamese market. Dozens of Korean projects are waiting to be invested in Vietnam, including several billion-dollar projects.
June 29, 2023 | 10:52
Vietnam Remains Priority Investment Destination of Korean Businesses

According to the Director of the Foreign Investment Agency Do Nhat Hoang, international organizations positively evaluated Vietnam's investment environment. Moody's and S&P consider Vietnam to be one of the two countries in Asia that improved its long-term credit index at a stable and positive level. Nikkei Asia rated Vietnam as the country leading Southeast Asian region in recovering from the Covid-19 pandemic (and ranked 8th in the world).

ETRO rated Vietnam as the third most attractive investment destination in the world and the second in Asia. According to a survey by EuroCham in the first quarter of 2023, Vietnam is in the top 5 global investment destinations.

In the past 6-7 years, the RoK rised to the position of the number one investor in Vietnam. Accumulated to May 2023, the RoK is the leading partner with 9,666 projects, and nearly US$81.6 billion, accounting for 18.2% of total investment capital.

In the first 5 months of 2023 alone, investment from the RoK into Vietnam was US$666.5 million, ranking 5th out of 82 countries/territories, down over the same period. This data reflects that businesses are observing more carefully about investment decisions in the context of global volatility.

"However, the Foreign Investment Agency has a list of dozens of Korean projects waiting to invest in Vietnam. In which, there are several hundred million USD, there are billions USD projects," said Do Nhat Hoang.

For Korean businesses, Vietnam remains their number one investment destination. Korean large corporations, and businesses are looking to Vietnam with strong internal resources.

Issue decisions to remove difficulties

The Prime Minister, ministries, branches and localities had meetings and made many decisions to synchronously solve difficulties in the investment environment.

Specifically, the Prime Minister issued Document No. 493/TTg-KSTT dated June 1, 2023, requesting ministries, branches and localities to continue to strongly promote the reform of administrative procedures, improve the business environment.

The Prime Minister also issued Directive 14 on May 24, 2023 on a number of tasks and solutions to improve the efficiency of foreign investment.

These include effectively implementing assigned tasks, facilitating investment attraction, production and business, improving the effectiveness and efficiency of state management.

Vietnam strengthens the inspection, supervision and evaluation of investment activities, improving the efficiency of investment promotion and attraction activities.

Vietnam Remains Priority Investment Destination of Korean Businesses
Samsung is currently the largest Korean investor in Vietnam. Photo: baodautu

In addition, the Prime Minister requested the Ministry of Industry and Trade to inspect EVN on electricity supply and management. The Ministry of Industry and Trade asked EVN to urgently negotiate a temporary price with investors of wind power and transitional solar power, allowing connection to the national grid for a number of specific projects.

The Ministry of Construction is conducting an overall review to amend and supplement the QCVN 06:2022 (Circular 06/2022/TT-BXD dated November 30, 2022 of the Ministry of Construction) on fire prevention and fighting, to ensure suitability with the situation and conditions of Vietnam.

To support businesses, the State Bank reduced the operating interest rate for the third time in 2023, which is a premise to reduce interest rates on both deposits and loans.

Orientation and solutions

Regarding Vietnam's foreign investment direction, Do Nhat Hoang affirmed that Vietnam will attract and selectively cooperate with foreign investors. Vietnam takes quality, efficiency, technology and environmental protection as the main evaluation criteria.

Along with that, priority is given to projects with advanced, high, and new technology, modern management, high added value, spillover effect, technology transfer, and global supply chain connection.

Director Do Nhat Hoang said that our country is also continuing to reform administrative procedures, especially the implementation of procedures after issuing the investment registration certificate, such as land, construction, fire protection, environment, and customs.

Vietnam has solutions and policies to promote investment attraction in a number of potential and breakthrough fields, such as high technology, semiconductors, and innovation.

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