European FDI tippled to increase

Early this month, a delegation of 29 French companies visited Vietnam seeking investment opportunities in infrastructure, healthcare and financial sectors. They include EDF Group, France Telecom, Societe Generale, Total and Michelin.

Frederic Sanchez, chairman of MEDEF International - who led the delegation, said the visit was a sign of French investors’ increasing attention to Vietnam. Till now, French companies have been investing in 348 projects in Vietnam, worth around $3 billion.

Also in March, business delegations from Belgium and Italy visited Vietnam and signed a series of business agreements. The recent visits of European companies show that Vietnam remains a priority for investment, despite the economic crisis in their home countries.  According to EuroCham Business Climate Index survey, 55 per cent of European companies operating in Vietnam said the crisis had affected them. However, most stated it was a “slight” effect. On the contrary, 44 per cent said the crisis in Europe did not affect their decision to invest in Vietnam at all.

“I think one of the main reason is the positive environment that they can find in Vietnam as governance and political stability, competitive workforce with a country really open to attract European investment,” said Michele D’Ercole, president of Italian Chamber of Commerce, adding that Vietnam was a perfect gate to enter in the Asian market because Vietnam was part of ASEAN with a large trade free agreement among 11 member countries and also special free trade agreements with China, South Korea and Japan.

Indeed, European companies are  considering Vietnam as a base for expanding into Asia and even China. Nokia, the word’s largest mobile phone maker, decided to build a factory in Vietnam for further expanding its business in Asia. Piaggio said its production base in Vietnam would serve the demand not only in Vietnam, but also Asia.

“EuroCham believes that once a Vietnam-EU Free Trade Agreement is in place, European investment in Vietnam will further increase both in quantity and in quality,” EuroCham said.