Vietnam’s Tourism Real Estate Sector

   According to forecasts, in the next 5-10 years, Vietnam will remain as an attractive destination for foreign investors. In which the tourism real estate sector is preparing to welcome a new wave of investments with large-scale projects.

A report of Capital Partners Group Vietnam shows that in the next 5-10 years, GDP per capita of Hanoi and Ho Chi Minh City will be equivalent to those of some large cities in Southeast Asia. Therefore, beachfront apartments will become the new growth segments.

Mr. Kenneth Atkinson, CEO of Grant Thornton Consulting Group Vietnam claiming that the living standard of people in general are more advanced, the demand for tourism is growing and a lot of foreign investors are heading their attention to resort projects. The demand for hotels, luxury resorts in the long term are remains high, therefore the number of projects in the hotel and resort sectors will continue to increase with more luxury resorts to meet diverse customer demand.

Recently, many localities have also implemented plan and urged local and foreign investors to invest in tourism real estate projects.

For example, recently, Quang Ninh is calling for investors to set-up business and invest in Vietnam for the period from now till 2020, including projects: coastal resorts, tourism, casino…There are some huge projects: Casino and entertainment complex with scale up to 2,000 hectares in Van Don with a total investment of 4-5 billion USD, Phoenix resort projects (Van Don) 250 million USD; Dam Nha Mac Service Industrial Park with 3,170 hectares and 530 million USD…

In Binh Dinh province, Vingroup has built the Hai Giang tourism project, with a total of more than 650 hectares, a total investment of nearly 3,500 billion VND. In 2015, it is expected that Vingroup can supply over 830 seaside villas to the market from three locations: Phu Quoc, Nha Trang and Da Nang.

FLC Group is also preparing to launch the complex project of golf course, resort, villas and high-end entertainment named FLC Nhon Ly in Nhon Ly Commune, Quy Nhon city. The project has a total investment of 3.500 billion VND.

Most recently, M.I.K Company has introduced the Sol House luxury resort project in Phu Quoc. The project is expected to be launched in early 2016, with a total investment of over 40 million USD, including 260 hotel rooms and villas, spa, indoor and outdoor entertainment areas, two restaurants, beach bar…

Mr. Than Thanh Vu, Deputy Chairman of Tourism Real Estate Association also said that recent moves of the Government on reducing the administrative procedures will provide ventilation for the real estate business, real estate market in general and tourism real estate in particular. In the next phase, tourism real estate sector will have a rapid growth.

Furthermore, Mr. Nguyen Nam Son, Executive Director of Capital Partners Vietnam said that: “If in the future, Vietnam can minimize the troublesome administrative procedures, increase Government budget on promoting tourism of Vietnam on international channels, travel trade fairs, open representative offices in foreign countries…, that will help Vietnam tourism industry and tourism real estate sector to grow fast”.

“Because investors are lack of information about the policy, project planning therefore they do not know where to invest in, which specific projects, for how long… so the local governments should organize more meetings, dialogues for domestic and foreign investors to exchange with each other and discuss with the leaders of the provinces and thereby make the appropriate investment decisions, “said Mr. Jonathan Tizzard, Department of hotel and resort, Cushman & Wakefield Vietnam.

According to Mr. Jonathan, the coastal localities like Nha Trang, Da Nang, Hai Phong, Binh Thuan, Ninh Thuan will become the most attractive destination in the next 5 years. In particular, the island of Phu Quoc (Kien Giang) has great potential to become a “hot” destination. Phu Quoc is not soon becoming an attractive casino center and tourism in Southeast Asia if the open policy of Government that enterprises can invest in resorts include casino soon to be widely implemented.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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Set-up Partnership in Vietnam

 A partnership is an enterprise which must be at least two members being co-owners of the company jointly conducting business under one common name. In addition to unlimited liability partners, there may be limited liability partners.

Unlimited liability partners must be individuals who shall be liable for the obligations of the company to the extent of all of their assets. Limited liability partners shall only be liable for the debts of the company to the extent of the amount of capital they have contributed to the company.

ANT Consulting is here to assist you from the outset; providing intelligence, information, management or support and administrative services that assist market entrance, and ensure efficient business start-up operation. Our services are as following:

Market Entry

Tax Advice

Legal Advice

Outsourcing Services

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows. We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

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Investment Through Signing Contracts in Vietnam

 Business co-operation contract (BCC) means the investment form signed between investors in order to co-operate in business and to share profits or products without creating a legal entity.

Build-operate-transfer contract (BOT) means the investment form signed by a competent State body and an investor in order to construct and operate commercially an infrastructure facility for a fixed duration; and, upon expiry of the duration, the investor shall, without compensation, transfer such facility to the State of Vietnam.

Build-transfer-operate contract (BTO) means the investment form signed by a competent State body and an investor in order to construct an infrastructure facility; and, upon completion of construction, the investor shall transfer the facility to the State of Vietnam and the Government shall grant the investor the right to operate commercially such facility for a fixed duration in order to recover the invested capital and gain profits.

Build-transfer contract (BT) means the investment form signed by a competent State body and an investor in order to construct an infrastructure facility; and, upon completion of construction, the investor shall transfer the facility to the State of Vietnam and the Government shall create conditions for the investor to implement another project in order to recover the invested capital and gain profits or to make a payment to the investor in accordance with an agreement in the BT contract.

Foreign investors may sign BOT, BT and BTO contracts with a competent State body to implement infrastructure construction projects in Vietnam. Typically, the contracts are for projects in the fields of transportation, electricity production, water supply, drainage and waste treatment.

The rights and obligations of the foreign investor will be regulated by the signed BOT, BT and BTO contract. The Government encourages both public- and private-sector investors to participate in BOT, BTO and BT in the following sectors:

(i) Construction, operation and management of brand-new infrastructure facilities; and

(ii) Renovation, expansion, modernization, operation and management of the existing infrastructure facilities such as:

• Roads, bridges, tunnels, and ferry landings;

• Railway bridges and railway tunnels;

• Airports, seaports and river ports;

• Clean water supply systems; sewage systems;

• Wastewater, waste collecting and handling systems;

• Power plants and power transmission lines;

• Infrastructure works of health service, education, training, career training, culture, sport and offices of State agencies; and

• Other projects as may be determined by the Prime Minister

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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Why Japan Investors Invest in Vietnam

 The depreciation of yen against dollar, more available funds for loans from Japanese banks, and the fast aging population make Japanese corporations increasing investment in foreign markets including Vietnam through setting up business venture.

In a morning of Jan 22nd 2015, the office of Ministry of Planning and Investment and Foreign Investment Agency have met and worked with small and medium business delegation of Japan to explore investment opportunities in Vietnam. The Japanese business delegation led by Mr. Shuichi Kageyama, vice president of Sumitomo Mitsui Banking, are representative of 21 companies operating in the area of construction, real estate, electronics, manufacturing, chemicals, pharmaceuticals products, medical devices. The visit has shown interests of Japanese investors in various sectors in the socio-economic development, environmental and investment policies of the government of Vietnam in attracting foreign investment. The Vietnam government also shows effort to support Japanese investor through improving on administrative procedures, and transparency.

The visit of Japanese delegation to Vietnam should be noted amid the strongest wave of Japanese corporations’ investment into foreign markets since 2006 after building up record cash on hands. The yen has been at weak level making M&A into foreign market expensive. However it is expected that yen will depreciate further against dollar over the year to come due to the policy of Mr. Shinzo Abe. In the meantime, Japanese banks are also ready to make more funds available for loans. Another fact is that Japanese population is aging faster. Those combined reasons together with Vietnam’s attractiveness for investors make Japanese corporations increase investment through making direct investment or acquiring other corporations in foreign markets including Vietnam.

According to the Foreign Investment Agency, as of Oct 2014, Vietnam has attracted more than USD 36.5 billion from Japan with more than 2,434 FDI projects. Japan ranks first in the number of countries and territories that have investment projects in Vietnam, in which, the first 10 months of the year 2014, total investment of newly registered and increased capital from Japan reached USD 1.66 billion. Thanh Hoa has 9 projects with a total investment of USD 9.68 billion; Hanoi has 607 projects at nearly USD 4 billion; Binh Duong province has 241 projects at USD 3.8 billion.

Japanese corporations invest in various area including retail, food processing, IT, manufacturing, constructions. Several prominent Japanese investors have been successful in Vietnam are Cannon, Isuzu Motors, Ajinomoto, Toyota Corporations, Logitem Logistics, Mitsubishi Corp, Kotobuki Holdings, Taisei Corp, Sumitomo Corp, Itochu Corp. The list will continue to grow as the time to come as Japan diversifies from China and Vietnam continues to emerge as an attractive destination.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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Hanwha Techwin Company (Korea) Wants to Invest in Bac Ninh

 Vietnam has always been an ideal investment destination for many foreign companies to come and set up business in Vietnam.

Currently, Mr. Yang Jin Seol, CEO of Hanwha Techwin Company (Korea) came to Bac Ninh to survey and explore the investment environment in Bac Ninh province.

Working with the Chairman of Bac Ninh Province, Mr. Yang Jin Seol said that Hanwha Techwin Company (under Hanwha Group) is specializing in producing security devices with 27 networks globally. Turnover of the Company in 2015 reached nearly 600 million USD.

Through survey and research, the Company is expected to invest in building factories in Que Vo Industrial Zone with a total investment of 50 million USD, in which the first phase (2017-2019) is 30 million USD. When put into operation, the plant will create jobs for about 1,500 – 2,000 labor, with capacity of 2 million pieces/year.

Mr. Yang Jin Seol hopes that the company’s business ideas will be interested and the provincial leaders will create favorable conditions, especially the preferential policies for enterprises producing high-tech products so that the Company can early implemented the plant construction in the first quarter of 2017.

The Chairman of Bac Ninh province welcomes Hanwha Techwin Company have trusted and choose Bac Ninh as investment destination to invest in stable and long-term production. He also assigned the Management Board of Industrial Zones in coordination with the Kinh Bac Urban Development Corporation – the infrastructure investor of Que Vo Industrial Park and other offices complete the legal procedures and creating all necessary conditions for the project of Hanwha Techwin Company.

Bac Ninh is one of the leading provinces in attracting FDI with nearly 1,000 projects with total registered capital of over 12.26 billion USD. South Korea has more than 400 projects, accounting for about 50% of total FDI capital of the whole province, in which there are many projects of large companies such as Samsung, Orion, Daewoo, Flexcom, Intops, Nano Tech…

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Establishing Distribution Company In Danang

 Da Nang is a city in the Central of Vietnam, with the advantage of being a trading place of many countries in the world. Danang has a large seaport in the top 10 large seaports of Vietnam, facilitating trading activities with many countries around the world.

At the present, Da Nang is promoting foreign investment into Da Nang, and many investors have chosen Da Nang to do business in the distribution business line. For this business line, Vietnam has committed to open up to attract 100% foreign investment. As committed, foreign-invested companies in the distribution sector will be allowed to provide commission agents, wholesalers and retailers of all products manufactured in Vietnam and legally imported products into Vietnam. Therefore, the investors can import or produce goods, then they distribute the goods in accordance with regulations.

In addition, with the increasing in the number of tourists coming to Da Nang in recent years, the demand for consumer products, fashion and other items for tourists has increased. This triggers demand that many companies to provide essential goods for tourists, and this is a great investment opportunity for investors both domestically and abroad. The investors could explore this opportunity to set up company in Da Nang and fill the market’s demand.

In addition, with many policies to support enterprises in administrative procedures, as well as management, investors can easily carry out procedures as well as manage and control their business better. Enterprises investing in Da Nang are now very satisfied with the way public services are handled in the city’s administrative procedures, therefore more and more investors are choosing Da Nang as a destination for investment when targeting in Vietnam.

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Vietnam attracts Korean investment in research and development

 In recent times, the investment shift out of China is being carried out by many international investors. Vietnam is a country that has enough factors to receive investment shift, especially in the manufacturing sector with low-cost labor and low expenses. However, at present, Vietnam has changed its method of attracting FDI, instead of taking advantage of low expenses and low-cost labor, Vietnam now aims to take advantage of highly skilled workers and many incentives in research and development activities.

Recently, many Korean investors have plans to change production lines, invest in research and development (R&D) company in Vietnam. Previously, Korean businesses mainly invested in industries such as apparel, bags, and footwear, however, recently many Korean investors have made investments in industries such as high electronics, information technology, automotive and construction equipment, distribution and service industries.

Currently, Korea is the leading country in the list of countries investing in Vietnam. Previously, a joint venture between Korean and Vietnamese businesses proposed to the Dong Nai province government to invest and build a Vietnam-Korea Hi-Tech Park with an area of ​​300 hectares, total investment capital of 150 million USD. The project aims to attract high-tech enterprises from Korea as well as other developed countries to set up company in Dong Nai in order to create quality product values ​​in the fields that shape the industrial revolution 4.0. The project is expected to attract 2 to 3 billion USD of investment capital in about 6 – 9 years after it is put into operation.

In addition, Korean investors have also cooperated with Vietnamese partners to build a Science and Technology Industrial Park with an area of ​​900 hectares in Binh Duong. In addition, many Vietnamese investors have actively worked with high-tech manufacturing partners to promote the participation of key partners as well as prepare the first customers.

With the policy of attracting investment in high technology and in particular the Investment law 2020, there are special investment incentives for newly established investment projects (including the expansion of the establishment project), the centers for innovation, research and development centers with total investment capital of 3,000 billion VND (about USD 150 million) or more, disbursing at least 1,000 billion VND within first 03 years from the date of issuance of the Investment Registration Certificate or the approval of the investment policy; a national innovation center established by decision of the Prime Minister; Investment projects in sectors or trades specially given investment incentives with an investment capital of VND 30,000 billion (about USD 1.5 billion) or more, with a minimum disbursement of VND 10,000 billion within 03 years from the date of issuance of the Investment Registration Certificate or the approval of the investment policy” will be given special incentives in accordance with the provisions of corporate income tax and land law.

As the investment attraction and investment shift preparation of Korean R&D enterprises, Vietnam hopes to become an investment destination for Korean high-tech enterprises in the future to establish company.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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How Business Information Could Be Searched in Vietnam?

  Provisions on announcing of business information are stipulated in various laws and degrees in Vietnam, allowing the interested party to be searching for business purpose for information in regard to investment registration certificate number, business registration certificate number and others information.

In particular, after the enterprise being granted an enterprise registration certificate, it shall carry out procedures to publish it on a portal as per procedures and pay the related fees for administration. The application for publication of enterprise registration information is a compulsory procedure, made at the time an enterprise submits its enterprise registration dossier. The content to be published includes the contents on the enterprise registration certificate and the lines of business. In addition, joint stock companies with foreign investors will need to provide information including founding. In case of changes in enterprise registration contents, the corresponding changes must be publicly announced.

Also, an enterprise must publish information in one of the forms posted on the business information network of the business registration agency or one of the written or electronic newspapers in three consecutive issues. The main content to be published includes: Company’s name; Address of the head office of the enterprise, branch or representative office; Lines of business; Charter capital of limited liability company and partnership company; number of shares and value of contributed capital and number of shares to be issued with joint stock company; initial investment capital for private enterprises; legal capital for enterprises conducting lines of business requiring legal capital; Full name, address, nationality, ID card number, passport or other legal personal identification number, establishment decision number or business registration code of the owner, member or shareholder foundation; Full name, permanent address, nationality, ID card number, passport number or other legal personal identification of the legal representative of the enterprise; Place of business registration.

For publication fees, the enterprise registration fee and the enterprise registration content announcement fee are VND 100,000/time.

There are some enterprises that do not need to publish their business information on the portal before going into operation, but make other forms of announcing i.e. on newspaper or other media. For instance, law-practicing organizations must publish on daily newspapers of central or local registry of law practice or newspaper for three consecutive issues. For credit institutions, foreign bank branches, representative offices of foreign credit institutions and other foreign institutions engaged in banking activities, they must be published on the State Bank’s media and in a daily newspaper written in 03 consecutive issues or an electronic newspaper of Vietnam at least thirty days prior to the scheduled date of operation of opening information.

In addition to disclosing corporate information, there is also a procedure for disclosure of information on the stock market that is applicable to public companies and bond issuers (except for government bond issuers and bonds), government-guaranteed bonds and local government bonds), securities companies, fund management companies, branches of foreign fund management companies in Vietnam, public funds complying with law on securities detailing information disclosure, announcing on the company’s website and information disclosure system of the Securities Commission.

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Binh Dinh: German Investors Want to Build A Wind Farm, Korean Businesses Interested in Assembling Cars

 In the last days of August and early Septemaber 2020, many potential investors from Korea and Germany have come to study opportunities to set up company and invest in Vietnam and specifically Binh Dinh province to explore investment opportunities, with billion USD projects.

At the meeting of the departments of Binh Dinh province with leaders of Hyundai Aluminum Vina Company and Cammsys Company of Korea coming to explore investment opportunities in this province, according to representatives of Cammsys Company, the company wants to find a suitable partner to develop and assemble electric cars and ready to transfer production technology to develop electric car in Vietnam market.

Through a field survey in Binh Dinh, the Company highly appreciates the infrastructure, traffic connection of the province with the region and the world, and wishes to cooperate with the development of projects to supply electric cars for the regions, tourist resort and production association of this vehicle in the province.

Meanwhile, the representative of Hyundai Aluminum Vina Company with the cooperation in Vietnam has been 14 years now; Total investment capital of the Company’s projects in Vietnam is up to 5 billion USD in many different fields. On this occasion, when coming to Binh Dinh province, Hyundai Aluminum Vina Company hopes to find a clean space with an area of about 200 hectares to invest in the infrastructure of the high-tech industrial park. If found a suitable position and approved for investment, the company will call and attract about 60 Korean investors to come and do business.

Binh Dinh has Quy Nhon Port which is the most convenient international trade gateway of the Central Highlands region and the province of southern Laos, northeastern Cambodia to countries around the world. In addition, the province also has a complete transportation system and infrastructure connecting air, road and railway, with direct flights to Korea. In addition, Binh Dinh is always and ready to support and create favorable conditions for mechanisms and policies, reform of administrative procedures, and support for investors.

In terms of German investor, Director of the High-Level Offshore Wind Power Project – PNE Group proposed to develop an offshore wind power park in Binh Dinh province with a total investment of 1.5 billion USD. This is one of the investors with more than 20 years of experience developing onshore and offshore wind power projects in Germany. At the same time, learning about mechanisms and policies to encourage wind energy development in Binh Dinh and the process of developing and approving wind power projects in Vietnam.

The group’s leaders believe that the implementation of the wind power park project in Binh Dinh province will make Vietnam become a competitive wind power supplier in the region and globally, contributing to the completion of sustainable development goals and the goals set out in the Vietnam Renewable Energy Development Strategy to 2030, with a vision to 2050, approved by the Prime Minister.

Vice Chairman of Binh Dinh Provincial People’s Committee welcomed the PNE Group for their interest in researching and proposing project investment in the province; At the same time, commiting to create the most favorable conditions for investors during the project implementation.

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