Vietnam urged to grab opportunity to be brought by QE3 to attract US FDI

VietNamNet Bridge – The US third round of the quantitative easing (QE3) is believed to be the golden opportunity for Vietnam to attract the foreign direct investment FDI from the country.

QE3 hoped to help boost Vietnam’s exports to the US

A group of US and Caymans businesses just arrived in Vietnam to have working sessions with central ministries and branches, including the Ministry of Planning and Investment MPI. Their ambition is to build up a special economic zone in Vietnam.

The details of the plan have not been revealed, but sources have said the special economic zone may be located in Binh Dinh province or Nha Trang City in the central region.

There are still many things that need to be done to turn the ideas into reality. However, the interest by the US investors shows that US enterprises have still been interested in the Vietnamese market.

Dau tu has quoted Bui Kien Thanh, a well known economist, as saying that the biggest thing that QE3 can bring to Vietnam is the opportunity to attract FDI from the biggest economy in the world.

According to Thanh, FED launches the economy stimulus package, but US enterprises may not borrow money to organize production domestically, but they would use the money to invest in the places where they believe have lower investment rates, open investment legal framework.

The recent pieces of news all make people believe that Vietnam deserves to be a good investment destination in the eyes of US investors. A survey conducted by the US Chamber of Commerce in Singapore on 350 high ranking executives showed that 57 percent of investors would choose Vietnam as the place for them to expand their business.

The figure has really surprised many experts, because this shows that Vietnam outdistances other countries such as Thailand (11 percent), Singapore (8 percent), the Philippines (7 percent), Indonesia and Myanmar (6 percent).

Other sources have also affirmed that Vietnam remains the top choice of investors in South East Asia. A lot of US groups of businessmen arrive in Vietnam in recent years to seek investment opportunities. The stories about Coca Cola, Unilever, Kimberly Clark, PepsiCo, P&G, Nike and Ford have been cited as the examples for the successes of the US investors in Vietnam.

In her working visit to Vietnam in mid July, the US Secretary of State Hillary Clinton also expressed the hope that the US would become the number one investor in Vietnam.

In fact, right after the diplomatic relation normalization, after the Vietnam-US Bilateral Trade Agreement (BTA) and after Vietnam became an official member of the WTO, Vietnamese economists spoke on business forums that they believed the FDI from US would increase rapidly.

To date, the US has invested more than 10 billion dollars in Vietnam, listing itself in the top 10 of the biggest foreign investors in the country.

Dr Nguyen Mai, a well known economist, former Chair of the State Committee for Cooperation and Investment, while commenting that 10 billion dollars is not a “bad result,” said that the figure is still lower than expected.

“The US investment in Vietnam has not increased as significantly as desired, while there have been not many big investors in Vietnam,” he noted.

He went on to say that Vietnam puts a high hope on the Intel’s investment project in Vietnam. However, the investor has not taken quick and strong moves as initially expected.

Another expert has also noted that while the US investors say they want to invest in Vietnam, the statistics show that its investments in Vietnam remain modest.

In the first eight months of the year, the US investors only registered 24 new projects with the total registered capital of 48.69 million dollars.

Compiled by C. V