FDI enterprises should not cut-and-run after enjoying benefits in Vietnam: Samsung CEO
Foreign companies should not take advantage of the benefits Vietnam has to offer and then just leave; they have a responsibility to accompany the Vietnamese people in the spirit of "harmonious benefits, shared risks", said Samsung Vietnam CEO Choi Joo Ho.
Speaking at a conference titled “Stronger investment partnerships for a thriving Vietnam” in Hanoi on Monday, Choi stated that Vietnam and Samsung have penned a memorable success story about win-win cooperation.
However, the global situation and rapidly changing business environment are threatening the continuation of this success, he noted.
According to the CEO, the U.S.-China power struggle is having a significant impact on Vietnam - a country that plays an important position in the global manufacturing industry, and Samsung itself.
The protracted conflict between Russia and Ukraine is leading to escalating inflation and a decline in international trade, and becoming a major barrier to world economic growth, he said, adding that the conflict has also created an unstable business environment.
On the other hand, world economic rules and order are changing. The Organisation for Economic Co-operation and Development (OECD) has applied the global minimum tax (GMT), a once-in-a-lifetime global tax reform that will apply to multinational companies with revenue of 750 million euros and more. Such companies will be subject to a minimum global tax rate of 15%.
This tax is expected to affect more than 100 multinational enterprises investing in Vietnam, thus threatening the country’s ability to attract foreign investment. In addition, the tax regime change will cause disturbances to Vietnam and FDI enterprises, he said.
In that context, Vietnam needs to improve the investment environment continuously. Since the launch of the Doi moi (reform) policy in 1986, Vietnam has ceaselessly improved its investment environment, leading to continuous investment expansion by FDI enterprises. However, these improvements must continue with a close watch on external factors and the implementation of appropriate reforms, he noted.
Choi went on to say that the GMT is a typical example of the most important 'external environmental changes' recently and the response by the Vietnamese government to this change is very important.
As a mechanism applied by an international organization, specific policies have been drawn up with the consensus of multiple stakeholders. When Vietnam applies these policies, it should significantly ease the instability of business activities among FDI enterprises, according to the Samsung official.
Global consulting firms operating in Vietnam such as Deloite and PwC, along with economic experts, have recommended Vietnam internalize GMT rules and introduce cost-based incentives to respond to the new tax, while emphasizing the need for legislation this year.
According to the CEO, the group hopes that the Vietnamese government will continue to create a stable business environment that meets global standards and recent investment environment changes.
The government has implemented the support policies it promised after Samsung's investment, and as a result, the Korean group has been continuously provided with the best business environment.
After investing in Vietnam, Samsung has also fully fulfilled its commitments such as creating stable jobs and promoting co-prosperity with Vietnamese businesses, Choi said, adding that recently, the firm realized its commitment to build an R&D center for research activities in the field of high-tech information technology.
The serious implementation of the commitments between the Vietnamese government and Samsung is based on a deep mutual trust, and the two sides have formed a positive circular relationship, he stressed.
Finally, the Samsung representative said foreign-invested enterprises need to continuously carry out social contributions in Vietnam. Vietnam is not just an investment market but has become a "land" nurturing businesses, he said.
The CEO revealed that Samsung is giving Vietnam the highest corporate social responsibility budget out of all the countries where it has invested. It is also implementing projects such as training science and technology, nurturing technological talents, and supporting disadvantaged children in learning.
Samsung officially started investing in Vietnam in 2008 with the construction of a mobile phone factory in Bac Ninh province, northern Vietnam. Its investment then expanded to Thai Nguyen, Hanoi, and Ho Chi Minh City. The group now operates six factories, one sales legal entity, and one research and development center in the country, with accumulated investment of $20 billion as of the end of 2022.
Currently, more than 50% of Samsung phones sold worldwide are made in Vietnam, making the Southeast Asian nation a key global mobile phone producer.
- Read More
Sumitomo subsidiary acquires 49% stake in Vietnam’s top crop protection firm
Summit Agro International Ltd., a member of Japanese conglomerate Sumitomo, has acquired a 49% stake in Hop Tri Investment Corporation, a leading crop protection firm in Vietnam.
Companies - Fri, November 22, 2024 | 8:25 pm GMT+7
E-wallets get thin as banking apps prosper in Vietnam
E-wallets appear unable to compete strongly against online banking applications in Vietnam, several market observers say.
Banking - Fri, November 22, 2024 | 7:15 pm GMT+7
Use social media influencers in targeted manner for e-commerce success: Vietnam execs
Vietnamese companies should use new generation influencers in a targeted manner, prioritizing specific market segments, standardizing quality and focusing on strong product categories to achieve e-commerce success, says Nguyen Ngoc Luan, CEO of Meet More Coffee.
Companies - Fri, November 22, 2024 | 4:26 pm GMT+7
VinFast’s parent, PV Power partner to speed up charging station expansion
Vietnamese private conglomerate Vingroup, the parent firm of electric vehicle manufacturer VinFast, and state-controlled PV Power have entered an agreement to develop charging stations across the country and promote rooftop solar installations.
Companies - Fri, November 22, 2024 | 4:11 pm GMT+7
Petrovietnam, Petronas to boost renewable energy cooperation
Petrovietnam and Petronas, two state-owned oil & gas giants of Vietnam and Malaysia, will further cooperate in renewable energy, including exchange of information, knowledge, and experiences.
Energy - Fri, November 22, 2024 | 2:59 pm GMT+7
FTSE Vietnam ETF may heavily buy Vinhomes, sell Vingroup in upcoming reshuffle: broker
FTSE Vietnam ETF is forecast to strongly buy in several Vietnamese heavyweights such as Vinhomes, Hoa Phat, and Vietcombank in its upcoming portfolio reshuffle.
Finance - Fri, November 22, 2024 | 2:45 pm GMT+7
$681 mln central Vietnam urban area project eyed by Sun Group gets authorities' nod
A VND17.3 trillion ($681 million) urban area project that is drawing the interest of major realty developer Sun Group has received an in-principle approval from Khanh Hoa province's administration.
Real Estate - Fri, November 22, 2024 | 1:53 pm GMT+7
Vietnam foreign ministry dismisses allegations of tightening visa rules for foreigners
Allegations of Vietnam tightening visa policies and control over foreigners are "baseless", Foreign Ministry spokeswoman Pham Thu Hang said Thursday.
Politics - Fri, November 22, 2024 | 11:29 am GMT+7
Thailand-invested food giant CP fined $31,000 for environmental violations
Vietnam’s southern province of Dong Nai has issued a fine of VND790 million ($31,080) to Thailand-invested C.P. Vietnam Corporation for violating environmental regulations.
Companies - Fri, November 22, 2024 | 10:48 am GMT+7
Vietnamese billionaire’s daughter spends $25 mln on Masan share purchases
Nguyen Yen Linh, the daughter of chairman Nguyen Dang Quang of consumer goods giant Masan Group (HoSE: MSN), has purchased nearly 8.5 million MSN shares over the past three weeks, meeting 85% of her target.
Finance - Fri, November 22, 2024 | 10:27 am GMT+7
PYN Elite manager upbeat about Vietnam’s economy, stock market despite Trump uncertainty
The Vietnamese economy will still fare well, and the local stock market will remain appealing despite the recent pullback following Donald Trump’s election win for a second term, said Petri Deryng, portfolio manager of Finland-based the PYN Elite fund.
Finance - Fri, November 22, 2024 | 8:25 am GMT+7
Central Vietnam province plans to build $2.4 bln LNG power plant from 2031
The 4,800-MW Chan May LNG power plant, with an investment of $2.4 billion, can be deployed in 2031-2035, according to Thua Thien Hue authorities.
Energy - Thu, November 21, 2024 | 10:41 pm GMT+7
Indonesia, France step up cooperation in economy, defence
Indonesian President Prabowo Subianto discussed economic and defence cooperation during a bilateral meeting on Tuesday with French President Emmanuel Macron on the sidelines of the G20 Summit in Rio de Janeiro, Brazil, Antara reported.
Southeast Asia - Thu, November 21, 2024 | 10:25 pm GMT+7
Thai economy to maintain upward momentum in 2025
The National Economic and Social Development Council of Thailand (NESDC) expects the Thai economy to sustain its upward momentum in 2025 with a growth of 2.3-3.3% despite growing risks.
Southeast Asia - Thu, November 21, 2024 | 10:24 pm GMT+7
Former parliament chairman Vuong Dinh Hue warned for violations
The Politburo, Vietnam's supreme decision making body, on Wednesday issued warnings to Vuong Dinh Hue, former Chairman of the National Assembly, and Nguyen Van The, former Minister of Transport, for violations while on duties.
Politics - Thu, November 21, 2024 | 10:10 pm GMT+7
Sumitomo insists on building LNG power plant in central Vietnam
Japanese trading house Sumitomo has been pushing for a liquefied natural gas (LNG)-fed power plant investment in Vietnam’s central province of Khanh Hoa.
Energy - Thu, November 21, 2024 | 8:53 pm GMT+7