Experts Urge Stricter Rules for FDI Approval

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Sept. 16 – Foreign direct investment experts are recommending that government officials set stricter conditions before approving FDI licenses to prevent aborting idle projects.

Ideally, FDI projects should be positive and sustainable. Authorities should be familiar with the foreign investor’s background before granting licenses.

Dr. Nguyen Minh Phong of the Hanoi Institute of Social Economy said there are risks involved when authorities only think about economic interests. Management agencies and local administrations should take into account national security during the FDI project licensing procedures, especially in regard to those projects using vast areas of land and forestation and mining located in strategic positions, Phong added.

FDI expert, Nguyen Mai, suggests that FDI strategy should focus on quality and efficiency, sustainable development, minimal carbon emissions and contracts to transfer technology and skilled personnel.

FDI disbursement in Vietnam can be unstable. From 2001 to 2005, FDI disbursement was US$14.3 billion compared to US$8.7 billion from 2006 to 2007  while US$11.5 billion was disbursed in 2008 and US$10 billion in 2009.

The Foreign Investment Agency forecasts that investors will disburse US$14 billion to US$15 billion this year. There were 11,759 FDI projects licensed in July with investments reaching VND187 trillion.