Subscribe | LinkedIn Group

Sep 25, 2011

Vietnam Government to Increase Scrutiny of Foreign-Capital Invested Projects from early 2012

In most cases, the Vietnamese government has not required environmental impact statements, labor negotiations/CBA or feasibility studies for most projects with foreign investors.
With the success of the Vietnamese economy and the reduced need for foreign capital, the government in Vietnam, under Prime Minister Mguyen Tan Dung, has vowed starting early in 2012, to implement a more stringent reporting, approval and resource license and procurement procedure.
Reports have circulated that approval will not be likely for golf courses, steel mills, mining and other projects that may have a significant negative impact on the environment.  Additionally, licenses for mineral explorations rights will be more difficult to obtain for investors without significant experience in Vietnam.   
The Mguyen Tan Dung Administration, however, has vowed, by the start of this year, to implement programs to encourage foreign investment in IT, agriculture and textile.   We are not sure, yet, what these measures will be, but we expect tax holidays, cash incentives and low-cost leases.
We highly recommend, prior to expending resources in Vietnam, to conduct a feasibility study.  We see too many countries waste time and resources on ventures that are near impossible for foreign investors to conduct in Vietnam or that are more suitable to other Asian locales.