Promote FTA negotiations, attract investment in foundation industries

Vietnam - an attractive market for foreign investors

Presentation at the European Regional Trade Counselor Conference taking place in Italy on July 18 and 19, 7, on the content of promoting cooperation and attracting investment to develop fundamental industries. platform and supporting industries, Mr. Nguyen Duc Thuong - Commercial Counselor of the Vietnam Trade Office in Switzerland said that the two countries Vietnam - Switzerland still have a lot of potential to promote investment cooperation in the industrial sector.

Citing statistics from the General Department of Vietnam Customs, Commercial Counselor Nguyen Duc Thuong said, By the end of June 6, Switzerland had 2024 valid investment projects in Vietnam with a total registered capital of 214 billion USD, ranking 2,028st/21 countries and territories investing in Vietnam.

In the first 6 months of 2024 alone, Switzerland has 7 new FDI projects with a total registered capital of 1,14 million USD. In addition, there are 3 times of adjusted projects with an additional adjusted capital of 104,73 million USD, 7 times of capital contribution and share purchase with a value of 0,38 million USD. Total registered investment capital in the first 6 months of 2024 reached 106,25 million USD, an increase of more than 6,3 times compared to the same period in 2023. Switzerland is the country with the 12th total registered investment capital among countries. invest in Vietnam in the first 6 months of 2024.

Switzerland's registered investment capital in the first 6 months of 2024 increased so strongly because Nestlé Vietnam just decided to invest an additional 100 million USD to double the processing capacity of high quality coffee lines at the factory. Nestlé Tri An, Dong Nai province, increased the total investment capital at this factory to more than 500 million USD.

Analyzing the advantages and disadvantages of attracting Swiss investment in Vietnam, Commercial Counselor Nguyen Duc Thuong said, regarding advantages: According to statistics from the Swiss Federal Department of Economic Affairs, there are currently about 60 Swiss businesses are having direct investment activities in Vietnam. Swiss companies have created thousands of jobs in Vietnam through investment projects, positively contributing to Vietnam's socio-economic development. Most Swiss investment focuses on processing and manufacturing industries.

Through surveys at associations and local businesses, Vietnam is an attractive market for foreign and Swiss investment thanks to the following factors:

One is, Rapid economic growth: Vietnam is one of the fastest growing economies in Asia with a stable GDP growth rate. This dynamic growth creates an attractive environment for investment.

Secondly, Strategically located: Vietnam's location in Southeast Asia provides access to major shipping routes and proximity to other major markets, including China, Japan and ASEAN countries.

Third, Extensive international integration: Swiss businesses highly appreciate the FTAs that Vietnam has participated in, especially new generation FTAs such as EVFTA and CTTPP.

Four is, young and dynamic workforce: Vietnam has a large, young and increasingly skilled workforce, which is very attractive to businesses looking for investment opportunities in Vietnam.

Year is, The political environment is stable, creating peace of mind for foreign investors.

Six is, The Vietnamese Government offers many different preferential policies for foreign investors, including tax exemptions and reductions, land use incentives... Swiss businesses highly appreciate Vietnam's establishment of the Trade Zone. The first free trade opens in Da Nang in 2025. This will be very attractive to foreign investors.

Seven is, Growing consumer market: With a growing middle class, Vietnam has an expanding market for consumer goods and services, which can attract Swiss companies in these fields. this area.

Administrative reform to attract investment from Switzerland

Besides the advantages, investment activities between the two countries also face many difficulties, including the fact that the two countries do not have a bilateral trade agreement: According to local businesses, in the coming time, Vietnam will have to compete in attracting investment, especially with countries in the Asian region such as India, Indonesia, Thailand, Malaysia or the Philippines. The fact that the two sides do not have an FTA is also a challenge for Swiss businesses that want to expand business investment in Vietnam. Meanwhile, India just signed an FTA with the EFTA bloc in early 2024. In the ASEAN region, Singapore, Indonesia and the Philippines already have FTAs with the EFTA bloc, while Thailand and Malaysia are also negotiating FTAs like Vietnam.

Along with that are infrastructure shortcomings: Although there have been improvements, Vietnam still faces infrastructure challenges, especially in transportation infrastructure, urban infrastructure, logistics and energy.

Or legal barriers are at times complex and slow, with sometimes inconsistent enforcement of laws and regulations; Limited skilled labor in some specialized fields: While the overall workforce is young and dynamic, Vietnam lacks highly skilled professionals in specialized fields such as High-tech production and advanced techniques.

Not only that, the enforcement of intellectual property rights is still a worrying issue, which can be a barrier for foreign companies, especially in high technology and innovation.

To promote cooperation and attract investment from Vietnam, especially to develop foundation industries and supporting industries, the Vietnam Trade Office in Switzerland recommends and proposes.

First, Due to the characteristics of the Swiss economy, the fundamental industries that Vietnam can promote to attract investment from this country are: Mechanical engineering (especially precision mechanical engineering); Medical equipment; Pharmaceutical; Information Technology-Digitalization; Recycled energy; Food industry…

Monday, Promote negotiation and signing of FTAs with the EFTA bloc (including Switzerland) to create a favorable legal foundation for trade exchange, investment and industrial cooperation between the two countries. According to the experience of the FTA between EFTA and India recently signed in early 2024, it is necessary to add a Cooperation and investment promotion chapter to the FTA to promote Swiss and EFTA investment in Vietnam.

Tuesday, continue to promote infrastructure modernization, including transportation networks, energy supply and digital connections to reduce operating costs and improve business efficiency.

Wednesday, simplify administrative procedures, ensure consistent enforcement of regulations and provide clearer instructions to make it easier for foreign investors to access the business environment.

Thursday, Focus on developing a skilled workforce by strengthening the education system, vocational training programs and cooperating with foreign educational institutions, especially in high-tech and specialized fields.

Friday, Strengthen the protection of intellectual property rights, improve the legal framework and enforcement mechanism of intellectual property rights to build trust for Swiss companies, especially companies in the technology and technology sectors. renew.

Saturday, continue to maintain a stable political environment and reasonable macroeconomic policies to create a safe investment environment.

Eighth, Encourage sustainable business practices and investment in green technology, in line with global trends and Switzerland's capacity for sustainable environmental protection.

Ninth, Strengthen the role of trade and investment promotion agencies, and organize more business forums and networking events to introduce opportunities in Vietnam to Swiss investors.

Finally, Take advantage of the good diplomatic relationship between Vietnam and Switzerland, promote closer bilateral cooperation through bilateral cooperation agreements and exchange of delegations.

Source: Vietnam.vn