Key Issues for FDI Policy Re-formulation in Vietnam

Abstract:This paper offers an overview of policy issues that should be considered in re-formulating Vietnam’s FDI policy orientation and structure. At first, three basic issues of definition, positive and negative impacts, and the dynamic nature of FDI policy are reviewed. Following that, FDI performance and eight key issues relevant to Vietnam are discussed in turn, which consist of (i) policy consistency; (ii) operational effectiveness; (iii) screening and post-investment follow-up; (iv) FDI marketing; (v) priority and restricted sectors; (vi) FDI-local firm linkage; (vii) consistency with international rules; and (viii) decentralized administration. These eight issues range from procedural matters on the ground to overall policy consistency, from maximizing developmental efforts to minimizing conflicts and problems. They are presented as a comprehensive checklist for FDI policy design and implementation.