Huge potential for increased US investment to meet Vietnam’s infrastructure needs: experts

By Minh Tuan
Sat, February 3, 2024 | 11:17 pm GMT+7

The latest status upgrade in Vietnam-US ties has generated great potential to lure further foreign direct investment (FDI), given Vietnam’s need for soft and hard infrastructure, experts said.

From left: Richard D. McClellan, head of Tony Blair Institute’s operations in Vietnam; Ha Thu Thanh, chairperson of Deloitte Vietnam; Can Van Luc, chief economist of BIDV; and Bui Quang Minh, founder of multi-industry ecosystem Beta Group at a discussion marking the 30th anniversary of lifting of the U.S. trade embargo, Hanoi, February 2, 2024.  Photo by The Investor/Minh Tuan.

From left: Richard D. McClellan, head of Tony Blair Institute’s operations in Vietnam; Ha Thu Thanh, chairperson of Deloitte Vietnam; Can Van Luc, chief economist of BIDV; and Bui Quang Minh, founder of multi-industry ecosystem Beta Group at a discussion marking the 30th anniversary of lifting of the U.S. trade embargo, Hanoi, February 2, 2024. Photo by The Investor/Minh Tuan.

FDI inflows from the U.S. are yet to match the giant leap in bilateral trade since the Clinton administration lifted the decades-old embargo on Vietnam and the two former war foes normalized relations, said Ha Thu Thanh, chairperson of Deloitte Vietnam.

She was participating in a panel discussion organized in Hanoi Friday by the US embassy to mark the 30th anniversary of the trade embargo being lifted.

Thanh cited government statistics as saying that the U.S. ranked 10th in terms of registered FDI last year, but noted its actual FDI accounted for a mere 3% of total disbursement in Vietnam.

“Against the backdrop of fast growing trade (between the U.S. and Vietnam), I see much potential for incoming FDI from the U.S. after the two countries upgraded their ties to a comprehensive strategic partnership. It will be a new journey for the two countries to build up FDI [cooperation],” she said.

Thanh also said noted that the semiconductor industry holds great potential for U.S. companies to invest in Vietnam if the legal framework, corporate governance, and infrastructure were enticing enough.

Regarding indirect investment, she recommended that Vietnamese companies improve corporate governance to get more attention from U.S. private equity funds.

“Corporate governance has become more important, a ‘need to have’ instead of ‘nice to have.’ More money can come in via the stock market on the condition of good governance based on the best practices issued by the OECD (Organization for Economic Cooperation and Development).”

Bui Quang Minh, a Harvard Business School alumnus and founder of multi-industry ecosystem Beta Group, shared his personal experience in learning from American partners in growing his group’s start-up projects and the entrepreneurship spirit young Vietnamese get from the U.S., including the Shark Tank show.

Remarking on the potential areas in Vietnam that U.S. investors may get more involved in, Can Van Luc, chief economist of state-controlled bank BIDV, named venture capital in start-ups, energy, education, healthcare services, cultural exchanges, military cooperation, and digital transformation.

Elaborating on potential energy cooperation, Luc highlighted Vietnam’s ambition to have up to 30% of renewable energy in its power mix by 2030 from the current 16% ; and increase this further to 60% by 2050. To meet this goal, Vietnam needs capital, technology and other facilities that the U.S., which has strength in this industry, can provide, he said.

For Vietnam to capitalize on the Just Energy Transition Partnership (JETP), to which international institutions and foreign countries including the U.S. have committed more than $15 billion, the Vietnamese government should identify specific projects and programs, and one “terminal” contact point to supervise JETP enforcement, Luc said.

He told The Investor that American businesses with capital and technology are keen on developing renewable energy in Vietnam.

Luc emphasized that for Vietnam to go green, the government needs to have a detailed action plan to implement the National Power Development Plan VIII (PDP8) and issue better policies to develop renewable energy.

He felt that the U.S. can help Vietnam in formulating an action plan for the PDP8.

Comments (0)
  • Read More
Maersk opens its first bonded warehouse in Vietnam

Maersk opens its first bonded warehouse in Vietnam

Denmark's integrated transport and logistics giant A.P. Moller - Maersk (Maersk) on Thursday opened its first bonded warehouse in Vietnam at SLP Park, Nam Dinh Vu Industrial Park in Hai Phong city.

Industries - Thu, October 31, 2024 | 11:44 pm GMT+7

ABBank incurs $14 mln loss in Q3

ABBank incurs $14 mln loss in Q3

Hanoi-headquartered An Binh Commercial Joint Stock Bank reported a pre-tax loss of VND343.5 billion ($13.59 million) in the third quarter of this year, while some other private Vietnamese banks posted strong profits.

Banking - Thu, October 31, 2024 | 9:29 pm GMT+7

Vietnam’s emergence as regional manufacturing hub a significant logistics opportunity: SuperPort exec

Vietnam’s emergence as regional manufacturing hub a significant logistics opportunity: SuperPort exec

Southeast Asia’s rise as a vital logistics hub with Vietnam positioned as a key manufacturing center presents a significant business opportunity, says Yap Kwong Weng, CEO of Vietnam SuperPort.

Companies - Thu, October 31, 2024 | 9:01 pm GMT+7

Indonesia steps up support for textile industry

Indonesia steps up support for textile industry

Indonesia’s President Prabowo Subianto held a close-door meeting with several ministers on Tuesday to discuss the current situation of Indonesia's textile industry, particularly focusing on textile giant Sri Rejeki Isman (Sritex).

Southeast Asia - Thu, October 31, 2024 | 6:01 pm GMT+7

Thailand speeds up plans to construct six new airports

Thailand speeds up plans to construct six new airports

Thailand’s Transport Ministry is accelerating development and construction projects on six airports with an aim to become the region's transportation hub.

Southeast Asia - Thu, October 31, 2024 | 6:00 pm GMT+7

Thailand develops eco-friendly seaport model

Thailand develops eco-friendly seaport model

Thailand is striving to implement environmental protection and social sustainability solutions in developing the country’s major infrastructure projects, such as the development of Phase 3 of Laem Chabang Port, Thailand's only deep-sea port.

Southeast Asia - Thu, October 31, 2024 | 5:58 pm GMT+7

Indonesia intensifies oil palm cultivation to meet biodiesel demand

Indonesia intensifies oil palm cultivation to meet biodiesel demand

Indonesia is expanding its oil palm cultivation to increase crude palm oil (CPO) production as a raw material for 50% biodiesel (B50), according to the country’s Ministry of Agriculture.

Southeast Asia - Thu, October 31, 2024 | 5:56 pm GMT+7

Malaysia’s first domestic EV model opens for booking

Malaysia’s first domestic EV model opens for booking

The Malaysian multinational automotive company Proton's first electric vehicle (EV), the e.MAS 7, is now open for booking.

Southeast Asia - Thu, October 31, 2024 | 5:54 pm GMT+7

Thailand aims to become emerging leader in AI

Thailand aims to become emerging leader in AI

Thailand is positioning itself as an emerging leader in artificial intelligence (AI) regulation and development, thanks to policies that support an approach that balances technological innovation with ethical considerations and workforce protection.

Southeast Asia - Thu, October 31, 2024 | 5:53 pm GMT+7

Vietnam PM calls for more investment from Qatar’s $475 bln sovereign wealth fund

Vietnam PM calls for more investment from Qatar’s $475 bln sovereign wealth fund

Vietnamese Prime Minister Pham Minh Chinh has called on the Qatar Investment Authority (QIA), Qatar's sovereign wealth fund with total assets amounting to $475 billion as of 2023, to ramp up its investment in Vietnam.

Industries - Thu, October 31, 2024 | 4:43 pm GMT+7

FPT Retail earns $6.5 mln in Q3 profit, to expand FPT Shop chain

FPT Retail earns $6.5 mln in Q3 profit, to expand FPT Shop chain

Vietnamese retail major FPT Retail made a profit after tax of VND165 billion ($6.52 million) in the third quarter of this year, while it incurred a loss of VND13 billion ($514,000) in the same period last year.

Companies - Thu, October 31, 2024 | 3:56 pm GMT+7

Germany’s PNE opens rep office for $4.6 bln offshore wind project in central Vietnam

Germany’s PNE opens rep office for $4.6 bln offshore wind project in central Vietnam

Germany’s PNE AG, a leading developer of renewable energy projects, has shown its determination to proceed with a mega offshore wind power project in central Vietnam by opening a representative office there.

Energy - Thu, October 31, 2024 | 2:43 pm GMT+7

Saudi Arabian energy giant ACWA Power ready to invest $5 bln in Vietnam

Saudi Arabian energy giant ACWA Power ready to invest $5 bln in Vietnam

Saudi Arabian private energy giant ACWA Power stands ready to invest up to $5 billion in Vietnam, a senior executive said Wednesday.

Industries - Thu, October 31, 2024 | 2:39 pm GMT+7

Effective M&A deal depends on thorough understanding, value addition potential: Kido exec

Effective M&A deal depends on thorough understanding, value addition potential: Kido exec

An effective M&A transaction depends on fully understanding the company being acquired in order to create added value, says Kido Group CEO Tran Le Nguyen.

Companies - Thu, October 31, 2024 | 1:22 pm GMT+7

No budget apartments in Vietnam, chronic supply-demand gap widens

No budget apartments in Vietnam, chronic supply-demand gap widens

Vietnam saw no supply or transaction of low-cost apartments priced below VND25 million ($988) per square meter in the third quarter, says a real estate report by the Ministry of Construction.

Real Estate - Thu, October 31, 2024 | 1:10 pm GMT+7

Vietnam steel major SMC remains bogged down with difficulties

Vietnam steel major SMC remains bogged down with difficulties

Steel manufacturer SMC Trading Investment JSC has been actively selling assets to generate cash for debt repayment and maintain operations since the beginning of this year.

Companies - Thu, October 31, 2024 | 10:41 am GMT+7