Foreign banks grab slice of investment promotion action

The Japan Desk in Thanh Hoa (Japan Desk Thanh Hoa) of the Provincial Center for Investment Promotion, Trade and Tourism and BIDV signed a cooperation agreement. photo: investinthanhhoa.gov.vn

BIDV and Japan Desk Thanh Hoa, which is managed by the local Investment Trade and Tourism Promotion Agency, have signed an MoU to promote investment capital inflows from Japan to the north-central province of Thanh Hoa.

Hoang Si Tuan, head of Japan Desk Thanh Hoa, said, “The two parties will take advantage of each other to promote investment and trading activities in industrial zones and economic zones in the province.”

“We will create convenient conditions for BIDV to approach Japanese enterprises operating in the province to offer banking and consultant services with numerous incentives, which will encourage them to continue to expand the operation here,” Tuan added.

The co-operation between BIDV and Japan Desk is an example of the participation of foreign banks in promoting investment capital to Vietnam as the way that MUFG Bank, Mizuho, UOB, and others are doing.

According to statistics from the Ministry of Planning and Investment’s Foreign Investment Agency (FIA), these investment promotion activities often receive the attention of hundreds of foreign investors and dozens of business associations from each country with an interest in studying the investment environment.

Besides their foreign direct investment (FDI), advisory teams provide companies from across the banks’ network with local insights, market entry support and customised financial solutions, and connect them to regional business opportunities. Meanwhile, Vietnamese authorities will provide advisory services on investment policies and dedicated support in investment procedures and applications.

One of the outstanding cooperation models is the MoU signed between these foreign-invested banks and the FIA to pave the way for new and expanded activities into Vietnam.

UOB, for example, expects to facilitate a pipeline for additional billions of US dollars in FDI to Vietnam, following $2.24 billion secured from the first MoU signed in 2015, and extended in 2020.

Wee Ee Cheong, deputy chairman and CEO of UOB, said, “The expanded MoU with the FIA has reaffirmed our close and collaborative relationship in helping regional companies tap the Vietnamese vibrant economy, driving their sustainable advancement and boosting trade flows and job creation across ASEAN.”

UOB has helped more than 200 companies from Singapore, Malaysia, and China seize opportunities in Vietnam and aims to double that number with the latest MoU.

Sembcorp is one of the companies with whom UOB has been working closely in Vietnam to support its industrial park projects. Kelvin Teo, CEO of Sembcorp Development, said, “Vietnam is a key market for us. Thanks to UOB’s support, we operate 10 integrated townships and industrial parks in Vietnam under our VSIP joint ventures, of which three were launched in the last couple of years.”

In the framework of investment promotion events organised in the state leadership’s business trips overseas, dozens of MoU worth billions of US dollars have been signed by foreign investors and Vietnamese parties in recent times. For example, during the Vietnam-Singapore Business Dialogue organised in February, Vietnamese and Singaporean businesses signed cooperation deals worth nearly $11 billion. One of them is a cooperation agreement worth $1.5 billion in developing sustainable energy and urbanisation solutions between SOVICO Group and Keppel Group and their subsidiaries.

Besides that, SOVICO and Keppel Energy Ventures also exchanged documents for a $1.5 billion deal on developing comprehensive and sustainable energy solutions for the transition to a green economy and reduction of carbon emissions.

Takeshi Masuyama - Managing director; regional head of Vietnam, MUFG Bank, Ltd. Over the course of more than 25 years of presence in Vietnam, MUFG has been honoured to serve as a bridge connecting Japanese investors with Vietnamese corporates. Between 2016 and 2020, about $2.5 billion in foreign direct investment into Vietnam was contributed by our two branches. Since 2013, MUFG, together with our strategic partner, VietinBank and the Foreign Investment Agency, has successfully organised five conferences in Tokyo. This platform helps some of the largest Japanese corporations to have a direct dialogue with Vietnam’s officials and the Vietnamese business community to further improve the investment environment in Vietnam. We also hosted two follow-up workshops to implement ideas promoted in these conferences. In recognition of our contribution, in September 2021, we were honoured to receive a certificate of merit from the minister of planning and investment for the outstanding contribution to the promotion of foreign investment in Vietnam. In addition, our ongoing efforts to facilitate knowledge exchange and business flows between Japan and Vietnam are also well recognised by bodies such as the Japanese Chamber of Commerce and Vietnam Business Forum. Next year will mark two special milestones for Vietnam, Japan, and MUFG. The two governments will commemorate 50 years of diplomatic ties and we will celebrate the 10th anniversary of our strategic partnership with VietinBank. By leveraging our relationship with VietinBank and the broader MUFG network, we hope to foster greater ties between Japanese and global investors with the local business community, thereby bringing Vietnam to greater prominence in regional and global economies.