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Re: RICK C post# 1050

Wednesday, 05/21/2008 1:26:51 PM

Wednesday, May 21, 2008 1:26:51 PM

Post# of 1139
News -May 21,08
I do like this part=" It should also focus on improving the foreign exchange,"-----------------------------------------------
Investment should be targeted to hi-tech, support industries

(21-05-2008)

Viet Nam Chamber of Commerce and Industry president Vu Tien Loc spoke to Thoi bao Kinh te Viet Nam (Vietnam Economic Times) about the country’s investment environment.

How does the business community view the current investment environment in the context of recent economic fluctuations?

Obviously economic changes in the past few months have been a valuable experience for many investors and enterprises in planning their strategy and trading purposes.

Recent events have forced businesses to re-examine their operations and focus more on quality, efficiency and competitiveness.

In the past few months, short-term investment with high profit in the stock, estate and gold markets has not created much added value for the country.

When capital is not spent on developing technology and auxiliary industries, it does not have a stable effect on society.

Do you think that the economic fluctuations will produce more difficulties together with existing obstacles such as low capital availability and slow investment procedures?

In its annual report, the Government has admitted that inflation, rising consumer prices and the excess of imports over exports, together with sudden changes in the monetary market, stock market and real estate market have had negative impacts on the production, trading and investment environment.

That’s why the Government should focus on smoothing big obstacles like administrative procedures, capital lending, cash distribution and tax and customs procedures. It should also focus on improving the foreign exchange, reducing non-official expenses for enterprises, help enterprises improve technology and develop essential industries and additional industries as well as exports.

In particular, businesses should spotlight human resources, an area which is revealing more weaknesses as the economy takes in more investment capital.

What do you think is the most important piece of advice the Government can give businesses now?

As well as the above-mentioned easy trading environment, the most important thing to do is make markets transparent, easy to predict and reduce expenses. It’s also important to have well-controlled markets to get rid of speculation and market bubbles.

Trading strategy and enterprises’ capital should also aim to boost competitiveness, improve technology and increase product value.

Will the Government’s plan to have 500,000 more businesses in Viet Nam by 2010 be affected by the current economic climate?

I still believe the plan is feasible. The important thing is to adapt our way of doing things to the new situation.

Our economy is going through a difficult stage right now but we still have more than 3 million household businesses. And when the State applies various measures to stabilise the macro economy, limit inflation, especially when the bubbles in the stock market and estate market burst, I believe that investors will find more realistic investment opportunities.

What do you think about the proposed changes in tax policies for businesses currently being discussed at the National Assembly?

All of the proposed changes are good news for the country’s trading environment. With the new Value Added Tax Law, enterprises will have simple, clear, transparent and more equal tax policies.

In the new law on income tax, the State will cut duties for businesses, enabling them to invest in equipment and production development.

What do you think about Viet Nam’s potential economic development in the next few years?

I think Viet Nam’s long-term future is bright and in the next three years, the economy will return to its normal growth rate.

There are still many potential factors for economic development and the present difficulties are short-term. My opinion is also shared by many international economic organisations. — VNS

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