Heads of state-owned China Energy Engineering Corporation or Energy China (CEEC) Wang Jianping, Alpha King Real Estate Development JSC Wang Weixian, Ping An Insurance Company Song Chengli, China Jiangxi Corporation for International Economic and Technical Cooperation (CJIC) Xu Guojian, and Jiangxi Construction Engineering (Group) Co., Ltd Zhang Minfeng expressed their hope at a meeting with Chairwoman of the Vietnamese National Assembly Nguyen Thi Kim Ngan on July 10.

Earlier in her visit to Jiangsu, Ngan also met a number of local businesses, including Sunwah.

The executives said their operations focus on insurance, finance, infrastructure construction and energy. They expect to set up long-term business in Vietnam which has experienced the most rapid economic growth worldwide and boasts substantial potential for further development.

In turn, Ngan told the companies’ executives that Vietnam is offering investment incentives to several hi-tech sectors which are environmentally friendly and in line with the country’s sustainable growth.

She emphasized that Vietnam requires foreign investors to closely follow commitments on construction progress, quality, and environmental protection which Vietnam is paying special care for.

Chairwoman Ngan, who is on her ongoing visit to China (from July 8 to July 12), said Vietnam welcomes Chinese firms which meet the requirements.

Earlier in talks with Chinese companies in Beijing on the occasion of “Two Corridors and One Belt” Framework in Beijing in April, Vietnamese Prime Minister Nguyen Xuan Phuc said Hanoi encouraged all investors from China as long as they come with advanced technologies and make high-quality products and services.

China’s investment in Vietnam

Illustrative photo

 In the first half of this year, China was the third largest investor in Vietnam with US$2.29 billion in commitments, accounting for 12.4% of the country’s total pledged foreign direct investment (FDI).

FDI commitments from China and Hong Kong to Vietnam reached US$7.1 billion in the first five months of 2019 (making up 42.4% of the country’s total FDI) from US$5.8 billion in 2018 and US$3.7 billion in 2017.

Between January and April, China took the lead among investors in Vietnam for the number of newly-registered projects with 187 worth US$1.3 billion.

Head of Vietnam’s General Statistics Office Nguyen Bich Lam attributed Chinese investment inflows to impacts caused by the US-Sino trade war and benefits earned from free trade agreements which Vietnam has signed with its partners.

He said Vietnam should focus on selective FDI inflows to license those with hi-tech production chains and advanced management capability.

Lam said attracting FDI does mean that Vietnam accepts all money which seeks the country as a haven to avoid risks from the trade war and to benefit from low labor and services cost.

Echoing Lam’s ideas, Nguyen Mai, head of the Vietnam Association of Foreign Invested Enterprises (VAFIE) said in the context that China is exporting lots of materials and accessories to Vietnam, Chinese investment might aim to get “Made in Vietnam” origin for their products to avoid punishing tariffs levied by the US government.

Lawmaker Tran Hoang Ngan, who is also one of government advisors, warned that the FDI which seeks Vietnam as a haven in the trade war would soon leave the country after the investors already benefit from investment incentives.

For that reason, Vietnam needs to license foreign investors who pour money into hi-tech manufacturing and have good linkages with domestic supporting industries, Ngan noted.