Vietnam: Recommendations for FDI Strategy for 2020-2030 – Recommendations

Recommendations for 2020-2030

According to the report, the key steps the government should take to increase the FDI quality in the next decade are:

  • Create a national skills development plan to increase the share of skilled labor in the workforce;
  • Modernize investment promotion activities and focus on priority sectors;
  • Review and make changes to the current investment incentives policies to ensure quality FDI;
  • Open service sectors such as education, logistics, and financial services to increase competitiveness and growth;
  • Promote and facilitate investments abroad;
  • Seize opportunities to reduce the negative impact of Industry 4.0;
  • Implement supporting policies to help local suppliers and increase FDI linkages and spillover; and
  • Set up a new FDI management agency with more budget, capacity, and authority than the current one for effective implementation of the policies and strategies.

The government also needs to focus on priority sectors such as high-tech manufacturing, logistics, high-tech farming, travel, healthcare, and education in the next decade, in addition to the key sectors such as textiles, footwear, metal processing, and minerals.

Going forward, FDI will continue to be a major source of capital and drive exports in Vietnam. The government needs to focus on quality FDI and support domestic enterprises in moving up the value chain if it wants to retain its export competitiveness and achieve a sustainable growth. The recommendations put forth are a step in the right direction.

 

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