Vietnam to improve FDI efficiency
Do Nhat Hoang, Head of the MPI’s Foreign Investment Agency, told the press on January 4 that the resolution is needed to combat transfer pricing (selling goods or services among company divisions in different countries, often used as a means to evade taxes), which remains a challenge for Vietnam, and curtail the growing black list of FDI businesses that report losses year after year while keeping expanding production.
Under the draft, ministries and agencies will coordinate with each other to define specific criteria to attract beneficial FDI and do away with poor performing FDI projects.
The draft will regulate the responsibilities of each agency and introduce a post-licence inspection, examination and supervision mechanism across all levels of authority to make FDI management effective.
According to Hoang, the MPI has submitted an anti-transfer pricing project to the Government. However, as this is a complex field involving tax, custom and corporate management, the Government has assigned the Finance Ministry to coordinate with the MPI to work out specific measures for implementation.
He noted that in the coming time, the two ministries will complete a legal framework to prevent transfer pricing, train experts to handle transfer pricing issues and build an international price comparison database.
First of all, the two ministries will work together this year to issue legal regulations to prevent transfer pricing as early as possible and continue conducting inspections, Hoang said.
The MPI reported 1,100 newly licenced FDI projects and 435 additional capital projects between January 1 and December 15, 2012, with total capital exceeding 13 billion USD. Japan was the largest investor with 5.13 billion USD.
Vietnam expects to attract 13-14 billion USD in foreign direct investment (FDI) this year.
MPI sets economic targets for 2013
Vietnam’s goals for 2013 are to strengthen its macroeconomic stability, cut level of bad debt, reduce inflation, and strive for GDP growth of 5.5 percent and a 10 percent increase in export turnover.
The Ministry of Planning and Investment (MPI) set these targets at a press conference in Hanoi on January 4, during which it also introduced socio-economic solutions to help fulfil its 2013 targets.
According to Minister of Planning and Investment Bui Quang Vinh, Vietnam’s inflation rate of 6.81 percent and GDP growth of 5.01 percent in 2012 will help the country obtain even higher GDP growth this year.
To solve bad debt and remove business obstacles, the ministry will submit to the Government and National Assembly a three-year plan (2013 to 2015) to allocate State budget to localities, ministries and sectors.
The Government and the MPI have directed localities, ministries and sectors to prioritise the settlement of bad debts in capital construction field in 2012 and provide capital for projects that will complete in 2013.
The ministry will also focus on providing market support, resolve inventories, create favourable conditions for production, and restructure the economy to ensure social welfare and improve the lives of people.
