The Ministry of Finance (MoF) in cooperation with UK partners will organize an Investment Promotion Conference in the UK on July 4.

The conference aims to create a practical dialogue to help British enterprises and investors better understand the performance of Vietnam’s economy and policies and the determination of the Vietnamese Government in innovation, as well as strengthen the trust of British investors in Vietnam’s development potential.

The UK is Vietnam’s second-largest foreign investor in Europe, with total registered capital of $3.75 billion, and has the 15th-largest FDI in Vietnam among 122 countries and territories. It is Vietnam’s third-largest trade partner overall, with trade turnover between the two standing at $6.77 billion in 2018, up 10 per cent against 2017.

“Most British and EU investors have quite a bit information about Vietnam,” said Mr. Pham Hong Hai, General Director of HSBC Vietnam. “However, as a member of ASEAN, which has the fifth-largest economy and the third-largest population in the world, Vietnam is becoming an important investment destination. Thus, the conference is expected to help European and British investors look more closely at Vietnam.”

British companies have been present in Vietnam since 1988-1989 and have invested in key industries such as oil and gas, mining, manufacturing and processing, real estate, banking and finance, and insurance. Enterprises include BP, BHP Billiton, Rolls-Royce, Vodafone, P&Q, GlaxoSmithKline, Standard Chartered, HSBC, and Prudential.

Foreign investors in general have had an interest in Vietnam’s financial market, but the country doesn’t have many major businesses listed on the stock market, according to Mr. Hai. “Speeding up the process of equitizing State-owned enterprises and encouraging large-scale private enterprises to list would create more stocks and attract investment from foreign investors,” he said. HSBC has been cooperating with the MoF and the State Securities Commission of Vietnam (SSC) to upgrade the country’s stock market to an emerging market on the MSCI Index (Morgan Stanley Capital International).

Mr. Mike Lynch, Managing Director and Co-Head Institutional Brokerage at SSI Securities Corporation, said the Vietnamese Government and particularly MoF and SSC have made efforts and undertaken action programs to lure foreign investment flows into Vietnam, especially enhancing market transparency, diversifying products, and completing the draft Law on Securities in order to ensure safety, efficiency and sustainability. “With such efforts, Vietnam will become a profitable market for investors,” he said.

According to MoF, the direct investment value of nearly $4 billion from British investors in Vietnam does not yet reflect potential.

British indirect investment in Vietnam is also still quite modest, at approximately $1 billion. Thus, the financial market segment still has a lot of new opportunities for cooperation between the two countries and there is much potential for British investors.

The UK and Vietnam have signed many framework agreements, such as the Double Taxation Avoidance Agreement and the Agreement on the Protection and Promotion of Investment. It is expected that the two countries will promote the signing of a free trade agreement based on inheriting FTAs that the EU will sign with Vietnam. Once this bilateral FTA is signed, trade flows are expected to move more strongly.