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Nation still attractive to foreign investors
With its medium-and long-term advantages, Viet Nam remains an attractive FDI destination, according to the head of the Ministry of Planning and Investment’s Foreign Investment Department, Phan Huu Thang.
Some newly-licensed projects in Ba Ria-Vung Tau Province show just how attractive. In the first days of the Year of the Buffalo, the southern province has approved seven projects involving more than US$5 billion.
The Sai Gon Atlantis Hotel received the nod to increase its capital from $300 million to $4.1 billion; the $600-million Toc Tien Urban Area will be developed; and the $500 million Binh Chau-Viet Nam Resort and safari will be developed by a joint venture between a foreign and two Vietnamese firms.
Thang says considering the recession, the investments provide an impetus for the development of not only Ba Ria-Vung Tau but also other provinces.
Despite the dire economic forecasts for this year, there is also optimism about positive developments in the global economy in the fourth quarter.
"That is why foreign investors continue to invest in Viet Nam, awaiting a recovery in the world economy," Thang explains.
Many of them first come to Viet Nam on fact-finding tours and consider the situation carefully before making any investment decisions.
"The bigger the challenges posed by the global economic recession to the country’s investment environment, the warmer the welcome we should give foreign investors," Thang says.
While it is difficult to attract investors to a country, it is even more difficult to make them stay for a long time, he points out.
It is not only the responsibility of the ministry to make foreign investors stay here but also that of other related agencies and provincial authorities, he says.
Besides the inexpensive labour, the country must also offer better and more competitive services to woo investors.
"Top priority should be given to administrative reform," Thang says.
Catfish prices rise
Tra catfish prices have shot up in the Cuu Long (Mekong) Delta province of An Giang since supply has plummeted.
Many farmers stopped breeding the catfish following heavy losses when prices dropped last year, and since Tet the prices have recovered to VND16,000 a kilogramme, VND2,000 higher than in December.
Nguyen Van Tre, a catfish farmer in An Giang Province’s Thoi Thuan Commune who sold 500 tonnes at VND16,000, says he has barely earned a profit.
But he hopes to do better when he harvests again in three months’ time since feed prices have plunged by half in the last two months while fish prices have risen.
Cao Van Hung, deputy chairman of the commune’s People’s Committee, says only a fifth of the 199ha of tra fishponds are still farmed.
Le Van Khoi, another tra farmer in the commune who had been breeding the fish for 10 years, abruptly gave up farming in September 2008 after losing everything.
He filled in his pond and turned it into a volleyball ground.
"If I do not see the pond, I can forget the great sorrow caused by the loss," Khoi says.
Le Chi Binh, deputy chairman of the Association of Seafood Breeders and Processors in An Giang, said the province has 1,600ha under tra fishponds but 60 per cent remain fallow following last year’s losses.
Many are reluctant to resume farming because they have seen no changes in the overseas market for Vietnamese catfish, he says.
Housing market doldrums
Few property projects are marketed or houses sold in HCM City, making the market even more somnolent after Tet.
Middle-income earners in need of housing continue to put off buying decisions, hoping prices will fall further when speculators offload properties to repay bank loans.
The property sector, which crashed 12 months ago, is showing no signs of recovery amid the global economic recession.
The Government is taking measures to keep the economy afloat, including efforts to encourage investment in low-income housing.
A HCM City property developer says a number of foreign investors may either withdraw completely from the market or suspend their projects.
But on the flip side, this can benefit property developers by preventing a supply overhang that plagues many foreign markets.
A report from real- estate service provider CB Richard Ellis (CBRE) last month said the property market would recover in two to six years, propelled by economic and population growth.
But Marc Townsend, managing director of CBRE, was quoted by Sai Gon Giai Phong (Liberated Sai Gon) newspaper as saying there would be "unpredictable" changes in the property market this year.
He listed certain laws and regulations that have come into force as the causes.
He was referring to the laws on personal income tax, value-added tax, housing ownership by foreigners, hikes in automobile and property registration fees, lower bank interest rates, and resumption of bank loans for property projects.
Dang Hung Vo, a former deputy minister of natural resources and environment, said a stimulus package for the property market announced recently by the Government would help revive the property market.
VietNamNet, VNS
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