Foreign investors need Vietnam's business information in English: financial expert

Having spent nine years living in Vietnam and observing the local market, Gray, country director of Infinity Solutions, told Tuoi Tre News some proposals to help investors feel safe and improve the investment environment in Ho Chi Minh City.

After a long time here, can you tell us about foreign investor appetite?

As a financial planner, I deal directly with individual expat professionals to help them with their wealth management, retirement strategies, estate and legacy planning, and financial protection.

Most of my clients focus on overseas markets like the U.S., the UK, and Europe. But of course, the topic of investing directly in Vietnam often comes up.

When it does, clients are typically excited about the potential for growth, but also wary of how to invest in Vietnam, and what the unforeseen consequences might be.

Regarding publicly traded companies, we have seen in the past that strong GDP growth isn’t always reflected in the long-term performance of a country’s stock market indexes.

For this reason, my clients tend not to allocate much (if any) of their portfolio to Vietnam. They will often use an index like the FTSE All World or an emerging markets index to gain exposure to Southeast Asia more broadly.

Once Vietnam is upgraded to emerging market status by FTSE Russell, this will naturally lead to more of their portfolio being allocated toward Vietnam.

Some will also invest in actively managed funds like Dragon Capital and VinaCapital via their Vietnamese banks.

Private small- and medium-sized enterprises are a different matter. This is often where my clients consider investment. Businesses in the fields of hospitality, tech, and import-export are where I see frequent interest.

Concerns tend to center around rules regarding business ownership, such as whether they will need to involve local partners, and who to trust in this regard.

Other concerns include long-term commercial leasing agreements and whether landlords can be trusted not to sell up and move on halfway through a lease.

Dealing with local authorities and regulations is another concern. Many feel that they need the right connections in order to succeed, and being foreigners, they often lack these connections.

Then there is the issue of capital controls. If and when they sell their business, will they be able to take their money out of Vietnam easily?

While some of these concerns may not be as valid as these investors believe them to be, investors are concerned nonetheless.

In your opinion, is it necessary to establish an English information platform about the Vietnamese business environment?

While there is increasing clarity around business processes and regulations, these are not always presented in English and other languages clearly. Foreign investors often rely on agents to act as a bridge.

Having a dedicated website, in English, to share official information regarding business practices in Vietnam would help these investors feel more comfortable.

Advertising this website and service on public buses and airlines, as well as other visible locations would help foreigners feel that the authorities are on their side and want to help. This could ease a lot of the concerns that foreign investors have.

Having an officially endorsed database of reliable and qualified agents for matters such as tax advice, business establishment, visas, and so on would also give foreigners more confidence, as some agents in the market exaggerate their skills and experience, leading to negative outcomes and perceptions.

And finally, continuing to work with the chambers of commerce to hear directly the concerns of foreign investors and professionals, as well as reaching out via the press and other institutions can make voices be heard.

I am confident that the authorities are doing plenty of work behind the scenes to navigate the transition as effectively as possible.

One area that is always welcome is timely updates on progress, as well as challenges and opportunities. The more information the public has about Vietnam's merger of administrative systems, the more input they can have.

Personally, I would be interested in learning more about the two former provinces [Binh Duong and Ba Ria-Vung Tau] that have been merged into Ho Chi Minh City, and what industries and resources they specialize in. This information has been published in some media outlets, which is a positive move.

The more information the public has, the more opportunities they will identify, and the more involved they can become, helping to boost economic activity and collaboration within the newly expanded city borders.