Intel seeks simplified rules, lesser restrictions for Vietnam investment support fund

U.S. chip maker Intel has proposed simpler rules related to administative procedures and employment for Vietnam’s draft decree for the to-be-launched Vietnam Fund for Investment Support.

In its statement, Intel Products Vietnam (IPV) said it was already classified by authorities as a high-tech business per its investment certificates. As a result, Intel suggested no more documents for "high-tech business" confirmation as a step to receive support from the fund.

Any extra documents are a move against Vietnam’s efforts to reduce administrative procedures, per government’s Resolution 01/NQ-CP issued in January for cutting administrative procedures, the high-tech giant stressed.

In reply, the Ministry of Planning and Investment (MPI), the drafting team of the draft decree, said the Ministry of Science and Technology is in charge of issuing high-tech business confirmation documents, so the two ministries will collaborate on the task.

Regarding employment-related rules, Intel said those mentioned in the draft were not suitable because high-tech projects, especially those to do with semiconductors, used highly skilled professionals, high-precision technology and equipment and automation, which does not require a large number of workers.

Therefore, the draft decree should not have provisions related to employment by high-tech businesses, Intel argued.

In reply, the MPI has said that employment was not an absolute requirement to receive support from the fund. Employment, along with high technology, are prerequisites for “very special” support, the ministry clarified. The requirements aimed to encourage businesses to focus on training and employing high-quality workers as well as project expansion, the ministry added.

Intel has so far invested $1.5 billion in Vietnam. The Intel Vietnam factory accounts for 50% of packaging and testing tasks for the giant's global operations.

The company "appreciates continued support of the Vietnamese government and is committed to long-term investments in Vietnam," Intel Vietnam representative Phung Viet Thang said last March.

Commenting on the draft decree on the fund, the MPI said Vietnam’s current policy offered limited investment support with just income-based incentives, such as exemptions and reduction in taxes and fees. The upcoming Global Minimum Tax (GMT) will have major impacts in the country, prompting a update of its legal framework, the ministry stressed.

In particular, the "outdated" legal framework has prompted some global giants, which had previously proposed huge investments, to bypass Vietnam and invest in other countries.

For instance, Intel had suggested a $3.3 billion investment in chip production and asked Vietnam to pay 15% of the investment in cash, but finally decided to invest in Poland, the ministry noted in a report.