Foreign businesses continue to see Vietnam as a sound investment location

[ASEAN NOW News]

 

Davipharm’ s high-potency drugs zone in Bình Dương Province. Foreign businesses continue to see Vietnam as a sound investment location in the long-term. — Photo courtesy of the company

 

HCM CITY — While a number of foreign companies have moved part of their production or orders to other countries, many still see Việt Nam as a suitable location for investment in the long term.

 

Speaking at a virtual conference called ‘Invest in Vietnam. Wins and challenges.’ organised by Adamed and Davipharm last week, Nguyễn Hải Minh, partner at Mazars and vice chairman of EuroCham, said, “In Vietnam, FDI plays a key role, contributing a lot to the growth of the country, especially exports.”

 

According to Vietnam Times, there was a slowdown in foreign investment in the country due to COVID-19 this year, and some people were even concerned that foreign investors would not come or even move out of the country, he said.

 

“So Eurocham did a survey in August. It showed that 18 per cent of surveyed companies have already shifted part of their production to other countries and another 16 per cent are still considering."

 

“But we need to be extremely specific here to have a correct understanding of the situation. Companies are not moving factories or investment out of Vietnam, but just part of their production and orders."

 

“We talked to many companies. [Many said] ‘COVID will not last long, we see Việt Nam is still a suitable location for investment.' Many companies are even looking at Việt Nam as a hub for sales in the region.”

 

Opportunity in Vietnam’s pharmaceutical market

 

Michal Wieczorek, CEO of Davipharm, said he saw a wonderful opportunity in Vietnam’s pharmaceutical market.

 

Domestically produced drugs only met 47 per cent of demand, healthcare spending was expected to continue to grow, there was an ageing population with an increase in non-communicable diseases, and there was growth in the private hospital sector, he said.

 

Vietnam's pharmaceutical market would remain one of the fastest growing in the world, he said.

 

When in 2017 Adamed bought 70 per cent of shares in Davipharm, becoming the biggest direct Polish investor in Vietnam, it had a crystal-clear strategy, he said.

 

Despite pandemic challenges, the company succeeded in achieving the EU-GMP certification for the drug manufacturing line in its factory in Bình Dương.

 

“With this EU-GMP certification, we are ready to achieve our other ambitious goals,” he said.

 

Challenges

 

Speakers at the event also talked about challenges that businesses had faced.

 

Minh said the business environment had improved a lot, especially in the last three or four years, though administrative procedures was still a big barrier, especially in terms of implementation of regulations at the provincial level where there were a lot of uncertainties in terms of implementing regulations. 

 

Jean-Jacques Bouflet, former head of Trade Affairs in the EU Delegation to Việt Nam, said since last year foreign businesses had experienced many regulatory challenges.

 

Today, faced with the pandemic reality, the country should also find a solution to live with COVID -19 since having workers live on-site proved to be exceedingly difficult for companies to implement, he said.

 

“The global COVID situation has proved that it is possible to combine both health protection and economic activities. This is what we need in Việt Nam today: running an economy with welcoming institutional regulations for foreign investors, especially the pharmaceutical industry, which is so critical for protecting health.”

 

Wieczorek said, “If the Government creates an attractive and welcoming investment environment for the pharmaceutical industry, I’m convinced that many more companies will follow us."

 

“But we need incentives, not obstacles.  Unquestionably, Vietnam is going to stay on the list of top priorities for Aramid this year and in future.” — VNS