Singapore Leads in Investment in Danang

Singapore is a reliable partner and a familiar investor for the Vietnamese market. Singaporean investors poured capital to invest in Vietnam, specifically Danang city.

According to Danang People’s Committee, since the beginning of 2018, the city has granted 27 new FDI projects with a total registered capital of 7.29 million USD, reach 97% over the same period in 2017.

Up to now, there have been 6 foreign investors registered to buy shares and contribute capital to economic organizations with a total registered capital of 12.98 million USD.

Total investment capital in the first quarter of 2018, the city attracted 33 million USD, increase by 128% over the same period in 2017. Accumulated until now, Da Nang has 577 FDI projects, total investment capital of 3.062 billion USD.

According to the Danang People’s Committee, currently the city has 5 projects using ODA capital managed by the city and being implemented with total investment capital of about 390 million USD, in which ODA capital is 314 million USD, accounting for 80% of total capital.

In addition, currently the city has 5 projects in the official promotion stage, requesting the Ministry of Planning and Investment to consider and mobilize donors.

It is known that Singapore is the leading investor in Da Nang with a total registered capital of 717.87 million USD (accounting for 23.44%); the second is Japan with total investment capital of over 647.26 million USD (accounting for 21.13%); the third is the US with total investment capital of 519.04 million USD (accounting for 16.95%) and the fourth is Korea with 256.17 million USD (accounting for 8.36%).

Danang leaders said that they are preparing investment in Cam Le and Hoa Nhon industrial clusters. In addition, they are regularly monitoring the investment procedures for industrial clusters in the area to remove difficulties and obstacles in the process of site clearance.

According to Da Nang People’s Committee, the city has 317 domestic investment projects with total investment capital of 89,670 billion VND.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 730 86 529 or email us ant@antconsult.vn

Read More

Why Asian Investors Prefer Vietnam Real Estate Market?

Profitability of high-end real estate in Vietnam surpasses that of ASEAN countries.

According to Mr Pham Lam, General Director of DKRA Vietnam, in the past 3 – 5 years, Asian investors from Korea, Hong Kong, Japan, Malaysia and China have been active in the Vietnam real estate market. They prefer golden land funds, specializing in high-end and luxury real estate development.

Also according to leaders of DKRA Vietnam, the investment wave of Asian investors will increase in the next few years. The expert also outlines the 7 causes of the trend that Asian investors hunting for golden land to develop high-end real estate projects.

Firstly, Vietnam is a developing real estate market. In emerging markets, there are more investment opportunities than markets that have grown too long (saturation of opportunity). Real estate in many Asian countries are too expensive and the investment at the present time is not attractive in the native country has urged Asian investors poured capital into Vietnam market.

Secondly, Vietnam is a country with political stability, which is considered as the most important factor that is of international concern before entering a new market. The stable political background brings safety for investment yields in the context of global geopolitical fluctuation is increasingly unpredictable.

Third, high-end and luxury real estate in Vietnam, especially Ho Chi Minh City (HCMC), is more profitable than ASEAN countries. According to a recent report of some surveyors in the country, high-end real estate in districts 1 and 3 of HCMC have a profitability ratio of more than 4%. In District 2, especially Thao Dien, An Phu and Thu Thiem areas, luxury apartments achieved a profitability rate of 5 – 6.5%.

Meanwhile, the profitability rate of investment in luxury apartments in ASEAN is fluctuating in the range of 3.7 to 5.2% and in Asia, it also has the same threshold. Therefore, luxury real estate in HCMC is considered quite competitive while the price is lower.

Fourth, Vietnam has Asian culture in accordance with the culture of other countries in the area. The similarity or proximity in culture is a very effective bridge in the process of investment promotion, investment cooperation, helping the Asian real estate owners easily access and penetrate the real estate market in Vietnam.

Fifth, Vietnam has a young population and is experiencing a spurt in income, so the demand for housing has increased sharply. The middle class, even the rich and the super-rich, are among the fastest growing groups in the world. This is a remarkable advantage of Vietnam.

With the flagship product of Asian investors, which is high-end real estate, they target rich consumers who are willing to pay for high-value assets with outstanding quality to assert their position.

Sixth, interest rates in the developed real estate markets in the Asia is very low. Interest rate in Japan is 1%, Singapore is 3%, Korea is below 2% and other regions such as Taiwan, Hong Kong is also at a modest level compared to Vietnam. This is the factor attracting the attention of investment funds and major real estate companies in Asia coming to Vietnam. In addition to developing projects with committed profit margin, they also carry out loan deals with better interest rates than in their hometowns.

Seventh, due to the same region, the moving distance between Vietnam and their home country of Asian investors is considered to be faster, more convenient than other continents. Close geography distance helps Asian investors have more opportunities to monitor, check the new market and make important decisions in time, making the most effective investment.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 730 86 529 or email us ant@antconsult.vn

Read More

Foreign Direct Investment from CPTPP

Still familiar investors, but with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) expected to come into effect by the end of 2018 and approved by the National Assembly on November 12th, there will be a greater and more quality flow of capital poured into Vietnam.

Two of the large foreign direct investment (FDI) projects registered to invest in Vietnam since the beginning of the year are owned by investors from 11 CPTPP countries. It is the 4.138 billion USD Smart City project of the joint venture between Sumitomo (Japan) and BRG (Vietnam), or the Laguna project register to increase the investment capital by 1.12 billion USD from Banyan Tree (Singapore).

There are also several projects such as Hanbaram Wind Power Plant (150 million USD), Ramatex Nam Dinh Textile and Apparel Factory (80 million USD) of Singaporean investor, Ykk Ha Nam Ykk factory project (80 million USD) of Japanese investors…

In fact, without CPTPP, investment capital from Japan, Singapore, Malaysia… still poured into Vietnam. They are the leading investment partners of Vietnam in the last three decades of FDI attraction.

According to data from the Foreign Investment Agency (Ministry of Planning and Investment), accumulated up to now, Japanese investors have invested in Vietnam over 56.2 billion USD, this figure of Singaporean investors is 46.2 billion USD, Malaysia is 12.5 billion USD, Canada is 5 billion USD, Australia is nearly 1.86 billion USD, Brunei is more than 1 billion USD…

Currently, out of 11 CPTPP members, all members have invested in Vietnam, except Peru. In total, the CPTPP members have invested in Vietnam of about 123 billion USD, accounting for nearly 37% of total registered FDI in Vietnam over the last 3 decades. This is not a small figure, indicating that the investment of CPTPP members is very significant for Vietnam’s FDI attraction.

The CPTTP will create favorable conditions for Vietnam to attract investment capital from other member countries, especially those countries that do not have FTA agreements with Vietnam, such as Canada and Mexico. The reason is that, this agreement will promote trade cooperation, in which trade is associated with investment. On the other hand, this is also an opportunity for Vietnamese enterprises, especially large corporations, to seek investment markets in other member countries.

Moreover, once the plans to invite Thailand, Korea and the UK join the CPTPP successfully, the opportunities for trade and investment cooperation in the region will be even greater. That will bring more benefits to Vietnam.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 730 86 529 or email us ant@antconsult.vn

Read More

New Capital Flows from French Businesses

Opportunities are opening for Vietnam to attract more foreign direct investment (FDI) flows from France.

As planned, during the visit to Vietnam of French Prime Minister Edouard Philippe (from November 2nd – 4th), in the afternoon of November 2nd, a series of new cooperation agreements were signed between enterprises of the two countries, to promote bilateral trade and investment cooperation. On November 4th, a business forum will also be held in Ho Chi Minh City, attracting the participation of about 200 businesses from Vietnam and France.

These moves are promising to open new opportunities for cooperation between the two countries’ businesses, which are believed to have great potentials and are on the rise. In fact, in March 2018, after a visit to France of General Secretary Nguyen Phu Trong, a series of new cooperation agreements were signed. Among them, there is an agreement between the T&T Group and the Bouygues Group (France) on investment cooperation of the no.3 urban railway project in Hanoi, with total investment estimated at 1.4 billion USD. The two Groups also signed an agreement on the BT contract (build – transfer) of a project to connect Ha Noi with Son Tay town (Nhon – Troi – Phung – Ring road 4 – Son Tay), cooperate to invest and develop the project of upgrading and expanding Hang Day Stadium…

In addition, there are cooperation contracts between Vietnam Airlines with Air France, Tre Viet (Bamboo Airlines) with Airbus…

In fact, there have been more positive trends in French investment into Vietnam since the beginning of this year. According to data released by the Foreign Investment Agency (Ministry of Planning and Investment), in the first 10 months of this year, French businesses have registered to invest 517 million USD in Vietnam.

France currently ranks in the Top 10 countries and territories with large investments in Vietnam, even ranks 1st among European investors have invested in Vietnam since the beginning of this year. If calculated cumulatively, France has invested in Vietnam 3.6 billion USD, surpassed UK.

When Prime Minister Nguyen Xuan Phuc was on a trip to Europe, the European Commission (EC) agreed to submit to the European Council for approval to officially sign the European – Vietnam free trade agreement (EVFTA), expected by the end of 2018, then submitted to the European Parliament for approval, scheduled for early 2019. Once this agreement has been formally adopted, a new door to promoting EU – Vietnam trade and investment will be opened. In this context, investment flows from France are also expected to grow strongly.

At the present, most French investment projects in Vietnam are implemented in the early stages of FDI attraction, such as BNP Paribas, Total, Schneider Electric, Renault, Technip…

Recently, some French investors started to increase their investment in Vietnam. Typical is Auchan with plan to invest 500 million USD to open retail system in Vietnam. Or Schneider Electric, with the inauguration of a new factory in Ho Chi Minh City, with 45 million USD investment capital in Phase I in 2017. In addition, Sanofi has 3 factories in Ho Chi Minh City…

Newer names, such as In Vivo and Olmix, are also boosting their investments in agriculture in Vietnam. EDF Group has been licensed to participate in Son My 1 Gas Power Project. In addition, Saint-Gobain is building a factory in Hai Phong city; Veolia, Suez and Vinci are actively pursuing water treatment projects.

ANT Consulting assists clients with Market Entry, Legal Advice, Tax Advice and Outsourcing Services in Vietnam.

We are located in Hanoi, Da Nang and Ho Chi Minh City.

Talk to our consultants at +84 28 730 86 529 or email us ant@antconsult.vn

Read More