Vietnam will continue to create appropriate investment incentives that bring benefits to both the nation and investors, Planning and Investment Minister Bui Quang Vinh has said.

At an online weekly Q&A session run by the Government’s portal on July 7, the minister noted that the current incentives are much more selective, especially for the manufacturing industries such as footwear and garments which import their materials for production and generate low added values.

He stated that preferences will be granted to those industries that create high added values, meaning more employment generation, more diverse products, and the use of more domestic materials.

Vietnam rolled out the red carpet to foreign investors 25 years ago, offering them a chance to capitalise on the country’s natural resources, incentive policies, and low labour costs.

The Minister confirmed that foreign investment is important to Vietnam’s economy, accounting for one fourth of the country’s total social investment. It has contributed to boosting technology advances, management skill improvements, and structural economic reforms.

He, however, acknowledged that foreign investment pledges in recent years have fallen sharply from 2009, though disbursements remain stable.

In the first half of 2013, 5.7 billion USD of foreign investment were dispersed, higher than the same period in previous years.

Over 60 percent of the nation’s export earnings come from the FDI sector, which creates 2 million jobs directly.

FDI firms also bring to Vietnam new technologies and management models which enable structural changes in the economy towards industrialisation and modernization, said Minister Vinh.-VNA