The foreign business community of Vietnam said that it is still optimistic and believes in the strength and resilience of the Vietnamese economy. Therefore, despite the difficulties coming from the pandemic, many foreign enterprises have increased their production and business expansion.

Tetra Pak invests additional 5 million euros for a factory in Binh Duong.
Photo: provided by the company

Faith in recovery

On September 19, at Song Khoai Industrial Park (Quang Yen town, Quang Ninh province), Jinko Solar Technology Co., Ltd. (Vietnam) was awarded the investment registration certificate for the Vietnam Jinko Solar panel technology project. This is the second project that this enterprise has implemented in Quang Ninh with an investment scale of nearly VND8,400 billion. Thus, the total investment capital of the two projects invested by Jinko Solar Hong Kong is nearly VND20,000 billion.

Speaking at the event, Mr. Huang Jinxing, General Director of Jinko Solar (Vietnam) shared his joy and excitement to continue investing in Vietnam. This result has confirmed the interest, support and companionship of Quang Ninh province with company. Jinko Solar is committed to quickly put the project into operation, producing the first batch of products at the end of 2021, and no later than January 2022.

Earlier, on September 17, Tetra Pak Company (Sweden) announced that it would invest an additional 5 million euros in a paper box factory worth 120 million euros in Binh Duong province. It is expected that the new investment would help increase the factory's annual output from the current 11.5 billion boxes to 16.5 billion, meeting the increasing demand for sterilized paper boxes in the country and region.

In addition, the factory would be facilitated to produce high-grade paper boxes to replace imported goods. Talking about this plan, Mr. Eliseo Barcas, General Director of Tetra Pak Vietnam, said that this additional investment showed confidence in the strong recovery of Vietnam's economy after the pandemic, helping the company serve customers better when capacity was increased, providing more attractive cartons, and minimizing its environmental impact.

Recently, in a letter to the Prime Minister and Deputy Prime Ministers, the American Chamber of Commerce (AmCham), the European Chamber of Commerce (EuroCham), the Korean Chamber of Commerce (Kocham) and the US Business Council - ASEAN (US-ABC) unanimously expressed their belief in the strength and resilience of the Vietnamese people and economy. In the September macroeconomic report of the World Bank (WB), in August 2021 alone, during the time when the Covid-19 pandemic was developing, Vietnam attracted US$2.4 billion of registered FDI capital, an increase of 65% compared to July. The report said that this increase shows that foreign investors continue to maintain confidence in the Vietnamese economy in the medium and long term.

Re-open quickly to avoid lagging behind

However, foreign investors still have many concerns if Vietnam does not act quickly to reopen the economy. According to a survey of AmCham, EuroCham, Kocham and US-ABC, at least 20% of members have moved some production activities out of Vietnam to another country, many other members were concerned about the problem of production transformation.

Alain Cany, Chairman of EuroCham, said that EuroCham's Business Environment Index (BCI) was currently recording its lowest result in more than a decade, but European enterprises in Vietnam still had confidence and optimism in the future and government leadership.

Currently, no European enterprises have left Vietnam due to the impact of the pandemic, but if the lockdown, social distancing and travel restrictions continued to last longer, new investment projects might be at risk and companies might consider moving elsewhere in the region.

Therefore, the foreign business community believed that Vietnam would miss investment opportunities if it does not quickly have a roadmap for opening up and recovering the economy.

“Vietnam will miss a great opportunity to take advantage of supply chain diversification from China if it could not prove to be a reliable alternative. In order to remain competitive in the region and globally, even compared to Malaysia, Indonesia and Thailand, Vietnam must act now,” the four associations AmCham, EuroCham, Kocham and US-ABC jointly stressed.

During a meeting with the Korean Ambassador, the Korean Association and enterprises in Vietnam on September 14, Prime Minister Pham Minh Chinh said that the Vietnamese Government was always ready to create conditions and accompany the Korean enterprises to invest and do business conveniently. The Prime Minister affirmed that the success of foreign investors was the success of Vietnam, the loss and disadvantage of foreign investors was also the loss and disadvantage of Vietnam.

Therefore, the Government has implemented many drastic solutions to control and repel the pandemic as well as issued Resolution No. 105/NQ-CP on supporting enterprises, cooperatives and business households in the context of the Covid-19 pandemic.

Resolution 105 has asked to remove one of the difficulties faced by foreign enterprises, which is the requirement for flexible implementation, loosening a number of regulations and conditions on the granting, extension and certification of work permits for foreign workers in Vietnam to be suitable to the new context but must be absolutely safe in terms of pandemic prevention and control. The Government also assigned the Ministry of Foreign Affairs to accelerate the negotiation and mutual recognition of "vaccine passports" with countries, territories and partners in order to open the economy when conditions permit.

But besides that, the foreign business community wants the Government to improve administrative procedures, allowing the approval of digital documents of enterprises, facilitating trade and investment during the pandemic, and permitting innovation and growth of the digital economy. Along with that, it is necessary to promote vaccination, build a coordination system that allows consistent identification, access and travel among localities, ministries and branches.

According to Mr. Guru Mallikarjuna, General Director of Bosch Vietnam, the European business community in Vietnam had proposed to amend the model of "three on spot", "one route, two destinations" which was making it difficult for most enterprises. In addition, the effective implementation of the EVFTA would further facilitate trade and investment among the two sides.