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Key points of Resolution No. 50 - NQ / TW on attracting foreign investment

Key points of Resolution No. 50 - NQ / TW on attracting foreign investment [1]
Key points of Resolution No. 50 - NQ / TW on attracting foreign investment [2]
Key points of Resolution No. 50 - NQ / TW on attracting foreign investment [3]

Resolution No. 50 - NQ / TW represents the Political Bureau's guiding opinion on tightening policies to improve the efficiency of foreign investment attraction activities.nt

    On August 20, 2019, the Politburo of the Socialist Republic of Vietnam passed Resolution No. 50-NQ / TW on orientations to perfect institutions, policies, improve the quality and efficiency of Foreign investment cooperation activities to 2030. Based on the results of the 30-year renovation to attract foreign investment, summarizing the achieved results as well as the limitations of foreign investment attraction activities in Vietnam, the resolution set out the guiding views. Regarding the investment policy to 2030, the following contents may affect the investment activities of foreign investors in Vietnam, which investors should not ignore, in particular:
I. Regarding the objectives of activities to attract foreign investment:
  • The proportion of enterprises using advanced technology, modern management, environmental protection, aiming at high technology will increase by 50% in 2025 and 100% in 2030 compared to 2018.
  • The localization rate will increase from 20-25% today, to 30% by 2025 and 40% by 2030..
  • The proportion of trained labor in the employment structure from 56% in 2017 to 70% in 2025 and 80% in 2030
II, Legal policies on activities to attract foreign investment
1. Completing institutions and general policies on foreign investment
  • Completing the legal system to overcome current limitations and shortcomings. Amending and supplementing regulations on investment procedures and conditions, concepts of investment activities, lists of geographical areas, domains and subjects eligible for investment incentives in investment laws foreign countries and relevant laws to unify implementation and ensure compliance with Vietnam's international commitments
  • Researching and developing regulations on overcoming the situation of "thin capital", transfer pricing, "underground" investment and "shadow investment". Additional research stipulating "conditions on national defense and security" in the process of considering and granting investment registration certificates (or documents of equivalent legal validity) to new investment projects and the process of reviewing and approving investment activities through capital contribution, purchase of shares or capital contributions
  • Completing synchronously the provisions of the law on investment, securities and foreign exchange management along the direction of clearly distinguishing between direct investment and indirect investment; agreement between enterprise law and foreign exchange control on stock purchase, transfer and account


2. Completing institutions and policies to attract investment
  • Develop specific list of restrictions, do not attract foreign investment in accordance with international commitments; Apart from this list, foreign investors are treated equally as domestic investors. Foreign investors are encouraged to enter the market in industries and sectors in which Vietnam does not need protection.
  • Developing investment criteria to select and prioritize investment attraction in accordance with plannings and orientations for development of branches, domains and geographical areas. Establish a security assessment mechanism and conduct a security review of foreign investment projects and activities that may or may affect national security.
  • Building institutional, superior preferential policies, international competition to create favorable business conditions to attract large projects, national key projects, high-tech projects ..., attract investors. strategic investment, multinational corporations invest, headquarter and set up research - development (R&D) centers, innovation centers in Vietnam.
  • To formulate adequate incentive and incentive mechanisms to increase the linkage between foreign and domestic investment, the domains to be prioritized to attract; developing industry clusters and value chains, contributing to improving domestic added value, product competitiveness and national position in the global value chain. Encourage technology transfer and governance for Vietnamese businesses. To adopt incentive policies for foreign-invested enterprises to train and improve skills and qualifications for Vietnamese laborers; employing Vietnamese workers who have worked and studied in advanced countries.
3. Completing institutions and policies to protect and enhance the responsibilities of investors
  • Amend and supplement regulations on labor, employment and wages, harmonize the interests of employees and employers in a transparent manner, meeting the requirements of international integration. Reasonably adjust the minimum wage gap between regions to restrict labor concentration in big cities and reduce infrastructure pressure. Clearly define responsibilities of infrastructure investors, foreign-invested enterprises in construction of social houses, worker houses, kindergartens, medical, cultural, sports facilities, etc. labor service.
  • Specifying the investors' responsibilities for environmental protection during the process of investment, project implementation and operation of enterprises during the project implementation duration in accordance with law.
4. Improving the effectiveness and efficiency of state management of foreign investment
  • Reorganize the management and implementation of investment projects, ensuring socio-economic - environmental efficiency, in accordance with the planning, in accordance with the criteria of project selection and screening ... strictly on procedures and procedures for grant, adjustment, withdrawal and termination of operation of foreign investment projects strictly according to law provisions.
  • Enhancing the inspection, supervision and inspection in association with raising the responsibility of local governments and leaders in the observance of the Party's guidelines and policies, the State's laws related to water investment. out. To definitively handle projects which cause environmental pollution, inefficient land use, suffer business losses for many years, and projects that do not meet their commitments. Prevention, early and effective settlement of disputes related to foreign investment.


5. Strengthening the leadership of the Party, promoting the role of the Vietnam Fatherland Front and socio-political organizations in foreign investment
    Developing and improving the efficiency of trade union organizations' operation in foreign-invested enterprises, promoting the role of trade unions in representing and protecting the lawful and legitimate rights and interests of trade union members , workers, building harmonious, stable and progressive labor relations, strengthening dialogue between business owners and workers. Striving for 100% of enterprises with 25 employees or more to have trade unions.


CONCLUSION: Resolution No. 50 - NQ / TW marked an important milestone in changing legal policies on attracting foreign investment in Vietnam in the direction of attracting and selectively attracting investors. Foreign investment. Legal policy focuses on the implementation of the main objectives: to increase the localization rate; towards projects using high technology, less affecting the environment, using less labor but bringing high economic efficiency; employ trained workers, skilled workers.
Those objectives will directly affect the legal policy in the process of selecting investors through the enhancement of effectiveness and efficiency of state management of foreign investment and tightening of conditions and procedures. investment licensing process, consideration and evaluation of licensing an investment project through the following factors:
  • Requirements on financial capacity of investors will be higher than before, reducing the ratio between loans and equity capital of investors
  • High requirements on environmental protection factors, giving priority to investment projects using clean, modern technology lines without causing environmental pollution, eliminating projects using old machinery chains, causing environmental pollution, labor intensive. At the same time, the law should be developed in a way that clearly identifies the investor's responsibilities for environmental protection instead of following the investor's commitment.
  • Demand for labor: Eliminate labor-intensive projects, use low-level labor, and promote projects that employ few workers but trained workers, workers. high level dynamics
  • Increasing the localization rate: improving the localization rate of investment projects, accordingly, the localization rate is from 30-40%
  • Enhancing the protection of workers' rights, establishing grassroots trade unions for enterprises employing 25 employees or more
  • Considering the factors of "conditions on national defense and security" in the process of considering and granting investment registration certificates
Above is all the contents to note for investors wishing to invest in Vietnam, hopefully the above information will be helpful in considering your investment decision.
Please contact us for advice on procedures for setting up investment projects in Vietnam.

Keyword: key points of resolution no. 50 in vietnam

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