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Private equity investors upbeat about Vietnam

Released at: 16:11, 22/03/2016

Private equity investors upbeat about Vietnam

Level of investment attractiveness in ASEAN members

Grant Thornton Vietnam survey on private equity sector reveals positive sentiment towards Vietnam's economy.

by Hong Nhung

The “Ready for Another Wave of Investment” survey conducted on the private equity (PE) sector in December and January by Grant Thornton Vietnam reveals that most respondents maintain their positive view of Vietnam’s economy.

In the survey, the 14th of its kind, views on Vietnam remained unchanged from the previous survey, with 86 per cent of respondents expecting investment activities to increase in the country over the next 12 months.

Significant changes were also found in the survey regarding the source of transactions, from “SOE equitization” rather than “Private/Family Owners”. The retail sector and food and beverages are considered the two most attractive industries for PE transactions.

Vietnam ranks second among ASEAN members in terms of investment attractiveness, gaining support from 25 per cent of respondents, following Myanmar with 46 per cent.

The positive outlook is attributed to improvements in Vietnam’s business environment, including two legal amendments that encourage private sector participation in government infrastructure projects and increase foreign ownership limits in listed companies, along with the introduction of the AEC and the signing of the TPP.

The survey also identified obstacles to investment, including corruption, government red tape, and constant changes in economic policies.

Respondents believe efforts have been made by the Vietnamese Government to improve the business environment, including issuing various laws and regulations and cutting the time needed to register a new company and make tax payments, for example, but these are considered insufficient. Thorough legislative reform is necessary now the country is part of the regional and global economic communities.

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