VIPC- About VIETNAM
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VIPC- About VIETNAM

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I.Vietnam –Emerging Land for Opportunities

I.Vietnam –Emerging Land for Opportunities
II. Foreign Direct Investment in Vietnam
III. Post-WTO Investment Climate and Legal Frameworks
IV. Investment-Related Costs

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VIPC- About VIETNAM VIPC- About VIETNAM Presentation Transcript

  • Thank you
    June 2010
    VIPC Viet Investment Power
    1
    VIETNAM
    Emerging Land for Opportunities
    JESSIE LAN VO
    Deputy CEO Assistant
  • CONTENT
    I. Vietnam –Emerging Land for Opportunities
    II. Foreign Direct Investment in Vietnam
    III. Post-WTO Investment Climate and Legal Frameworks
    IV. Investment-Related Costs
    2
    June 2010
    VIPC Viet Investment Power
  • I. Vietnam –Land for Opportunities
    1. Vietnam at a glance
    Geography
    - Population(‘09): 85.79 mil.
    - Centre of Southeast Asia
    - Area: 331,698 sq. km
    - Coastline: 3,260 km
    Society
    - Growth rate (’07): 1.2%
    - Under 30 yrs old: >60%
    - Literacy rate: >90%
    Infrastructure
    - National highways: 86,327 km
    - Railways:3,219 km
    - Int’l airports: Hanoi,Da Nang & HCMC
    - Int’l seaports: 11( CaiLan, Danang, Van Phong, etc.)
    - 150 IPs with area of 31,436 ha
    - 8 EZs with area of 323,940 ha
    Economy
    - Real GDP: 94.68 bil. US$
    - Real GDP growth rate(‘09):5.2%, year 2010e: 8.5%
    - Real GDP per capita(‘09): US$ 1052,year 2010e:1200 US$
    - Export turnover( May 2010): US$ 6.1bil.
    3
    June 2010
    VIPC Viet Investment Power
  • CONTENT
    2. Why do invest in Vietnam
    • -Political and socio-economic stability
    • - Brisk and steady economic growth
    • - Transportation hub of Southeast Asia
    • - Abundant young labor force at low price
    • - Member of WTO, APEC, ASEAN, ASEM
    • - Favorable FDI promotion policies
    • - Rapidly improving infrastructure
    4
    I. Vietnam – Land for Opportunities
    June 2010
  • II. Foreign Direct Investment in Vietnam
    1. FDI inflows to Vietnam( 1988- May 2010)
    5
    June 2010
    VIPC Viet Investment Power
  • II. Foreign Direct Investment in Vietnam
    2. FDI distribution by sector(1988-2007)
    6
    June 2010
    VIPC Viet Investment Power
  • II. Foreign Direct Investment in Vietnam
    3. Top ten countries investing to Vietnam
    7
    June 2010
    VIPC Viet Investment Power
  • IIII. Post-WTO Investment climate & Legal framework
    1. Vietnam’s commitments to WTO
    Schedule of concessions & commitments on goods:
    Bound rates for 10,600 tariff lines
    An average cut from 17.4% to 13.4% phased over 5-7 years since 2007
    Largest reduction applied to garments & textiles, fish& fish products, wood & paper, other manufactured goods, machinery, electrical & electronic items
    Committed to be member(fully or partially) to initiatives for IT products, garments & textiles, medical equipment, aircraft, chemicals, construction, equipment etc. Tariffs cut phased over 3-5 years since 2007
    Schedule of specific commitments on trade in services
    Open door in 11 out of 12 service sectors(or 110 out of 115 sub-sectors), including: business services, communication, construction & related engineering, distribution, health, insurance, education, tourism, environment, finance, entertainment, transportation, etc.
    Commitments put in force right after WTO accession. In some cases, they’re phased over 2-4-6 years since 2007
    8
    VIPC Viet Investment Power
  • III. Post-WTO Investment climate & Legal framework
    2. Investment-related obligations
    TRIMS (effective from 11 Jan 2007): Eliminate the application of requirements on trade balance, foreign exchange control on imports, export performance, export restrictions, local contents
    Intellectual Property Rights: Comply with TRIPS Agreement upon accession
    Transparency: Make public draft WTO-related legal instruments for public comments; Make public all legal documents; Provide WTO members with annual reports on equalization program
    9
    June 2010
    VIPC Viet Investment Power
  • IIII. Post-WTO Investment climate & Legal framework
    3. Investment Opportunities entitled to Incentives
    Preferential sectors:
    • Manufacture of new material & production of new energy, manufacture of high-tech products, bio-technology, information technology & mechanical manufacturing;
    • Breeding, rearing, growing & processing of agricultural, forestry & aquaculture products, production of salt, creation of new plant & animal varieties;
    • Utilization of high technology & advanced techniques, protection of the ecological environment & research, development & creation of high technology
    • Labor intensive industries;
    • Construction &development of infrastructure facilities & important industrial large-scale projects;
    • Professional development of education, training, health, sports, physical education & Vietnamese culture;
    • Development of traditional crafts & industries; and
    • Other manufacturing & service sectors which require encouragement
    Regions entitled to Incentives:
    - Regions with specially difficult socio-enonomic conditions;
    - Regions with difficult socio-economic conditions; and
    - Industrial zones, Export processing zones, High-tech zones & Economic zones
  • IIII. Post-WTO Investment climate & Legal framework
    4. Incentives on Corporate Income Tax
    Standard rate: 28%
    Preferential rates of 10%, 15% and 20% for a period of 15 years, 12 years and 10 years are available depending on the scope of activities and location of the investment.
    Tax holidays: A complete exemption from CIT for a certain period( 4 yrs at maximum) followed by a period where tax is charged at half rate ( 9 yrs at maximum)
    Losses: Carry forward losses for 5 years
    Other incentives: Exemption or deduction of land use tax, land use fee, land rent, and water surface rent
    11
    June 2010
    VIPC Viet Investment Power
  • IIII. Post-WTO Investment climate & Legal framework
    5. Import Duty Exemption & Reduction
    Exemption applied to projects in investment encouraged sectors & regions on:
    Machinery & equipment, specialized means of transportation & construction materials( which can not be produced in Vietnam) comprising the fixed assets of certain projects
    Raw materials, spare parts, accessories, other supplies, samples, machinery & equipment imported for the processing of goods for export and finished products imported to stock to the processed goods
    Preferential ratesapplied to imported goods from countries that enjoy MFN with Vietnam(89 countries).Rates vary by the category of goods.
    Special preferential rates applied to imported goods from countries that signed special agreement with Vietnam(e.g.ASEAN
    )
    Ordinary ratesare 150% of preferential rates
    VIPC Viet Investment Power
  • IIII. Post-WTO Investment climate & Legal framework
    6. Forms of Investment
    100% foreign-owned enterprise
    – Limited liability company
    – Joint stock company
    – Partnership
    – Holding company
    Joint venture
    Business cooperation contract
    BOT, BTO, BT
    Capital contribution, purchase of shareholding,
    M&A
    13
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    VIPC Viet Investment Power
  • 14
    III. Post-WTO Investment climate & Legal framework
    7. Licensing & Registration Procedure
    Projects fall in conditional sectors
    YES
    Investment Evaluation Procedures
    Investment Registration Procedures
    YES
    NO
    Investment capital is more than VND 300 mil.
    (approx. US$ 19 mil.)
    Respond within 45 working days
    Respond within 15 working days
    June 2010
    VIPC Viet Investment Power
  • 15
    III. Post-WTO Investment climate & Legal framework
    Provincial
    People’s Committee
    Management Boards of IPs,EZs
    Department of
    Planning & Investment
    Projectsoutside IPs & EZs
    Projects inside IPs & EZs
    Projects for infrastructure development of IPs, EZs
    8. Investment Licensing Bodies
    June 2010
    VIPC Viet Investment Power
  • IV. Investment-related cost
    1. Monthly-wage(Source: JETRO survey, May 2009)
    16
    June 2010
    VIPC Viet Investment Power
  • IV. Investment-related cost
    2. Land price, office rent (Source: JETRO survey, May 2009)
    17
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    VIPC Viet Investment Power
  • IV. Investment-related cost
    3. Public Utility & Transportation expenses(Source: JETRO survey, May 2009)
    18
    June 2010
    VIPC Viet Investment Power
  • IV. Investment-related cost
    5. Taxation(Source: JETRO survey, May 2009)
    19
    June 2010
    VIPC Viet Investment Power
  • Thank you
    VIPC Viet Investment Power
    20
    THANK YOU!
    VIPC Capital Management Corporation
    8 Nguyen Hue St., Dist.1, HCMC, Vietnam
    Tel: (84-8) 38277478/79 – Fax: (84-8) 38277488
    Email: info@vipc.com.vn - www.vipc.com.vn
    June 2010