Vietnam and Ho Chi Minh City in particular need to look at attracting foreign investment as a means to realizing the goal of developing domestic industrial capacity, not just a short-term fix, said Nguyen Anh Thi, head of the Saigon Hi-Tech Park's (SHTP) management board.
Speaking at a Thursday conference on prospects and solutions to attract investors in the context of the global minimum tax (GMT) being applied and new trends in HCMC, the SHTP representative said that in the past the Vietnamese economy has relied heavily on foreign investment.
Industry lies at the center of every country's economic policy, so if Vietnam wants to develop an independent and autonomous economy, it must develop the domestic industry.
“Technological capacity and the presence of national high-tech parks are very important in attracting foreign investment, especially to key industries like semiconductors,” he noted.
Citing the SHTP as an example, Thi said that the park is building two ecosystems associated with two stages of semiconductors in the short term: design and packaging. By the end of 2023, the SHTP had attracted $5 million of investment capital from Dutch company BE Semiconductor Industries N.V (Besi). This project is expected to promote the transfer of semiconductor chip packaging technology to HCMC in particular and Vietnam in general over the next 2-3 years, he added.
"We need to consider attracting strategic investment as a means, not an end. We must make strategic investors help us with improving technology transfer capacity and attracting investors to the supply chain," Thi stated.
The SHTP head noted that current investment attraction policies should revolve around people. If Vietnam wants to compete with other countries in the region, it must have a competitive personal income tax policy alongside other incentives.
“Vietnam’s six economic regions currently have different levels of development, leading to different mechanisms. Therefore, it is necessary to pilot this approach in leading localities like Ho Chi Minh City,” he said.
Noting 2024 is the first year that Vietnam will officially apply the GMT, he said that its implementation will create conditions to increase tax revenue from FDI enterprises, but will directly impact the country’s policies to attract foreign capital and its investment environment.
Pham Binh An, deputy director of the Ho Chi Minh City Institute for Development Studies, said that in the first two months of this year, Vietnam’s FDI commitments reached more than $4.29 billion, an increase of 38.6% over the same period in 2023. Domestic and foreign investors have been active in partnering with each other in catching up with new trends like emerging industries, new materials and energies, green and sustainable growth.