Vietnam reform, less red tape, to draw investors
Vietnam reform, less red tape, to draw investors
HANOI (Reuters):Communist Vietnam said on Thursday that
economic reform, less bureaucracy, and a U.S. trade agreement
that has still to be ratified, would bring back foreign investors
in the next five years.
Minister for Planning and Investment Tran Xian Gia predicted
in an interview that foreign investment would soon return to
levels not seen since a mid-1990s boom.
"In the next five years we expect capital disbursement of
foreign direct investment to be around US$11 billion, about $2.2
billion a year," he said.
Increasing foreign investment flows is a key aim of a 10-year
economic strategy to be adopted by Vietnam's ruling Communist
Party at a five-yearly congress that began on Thursday.
Analysts say the expected replacement at the congress of
conservative party leader Le Kha Phieu with reform-leaning
National Assembly Chairman Nong Duc Manh could help.
Foreign investment has been sluggish in recent years compared
with the mid-1990s, when more than $2 billion a year came pouring
into the country.
Potential investors complain that red tape and corruption are
weighing against Vietnam's potential and better deals are
available elsewhere.
Gia brushed aside concerns about corruption and bureaucracy,
also raised recently by the IMF and World Bank, which are
together offering Vietnam more than $750 million to aid economic
reform and poverty reduction efforts.
"I admit that there are such comments from the IMF and the
World Bank, but I can confirm that bureaucracy and corruption are
not increasing, they have been reduced," he said.
A recent survey by the Hong Kong-based Political & Economic
Risk Consultancy found Vietnam had outstripped Indonesia to be
come the most corrupt country in Asia.
Gia said the slowing investment had been due to the Asian
economic crisis, but added the government's slow up-take of
market reform was also a factor.
"About 70 percent of foreign investment was from Southeast
Asian countries which have been suffering from economic crisis,
and global competition for capital is tougher." he said.