"The capability for guarantees for new investment from foreign developers is limited in any country, not only Vietnam," he said.

"That is why the government only issues guarantee to a certain level."

Tony said that during the past over 10 years, BOT had been the only form of investment available to foreign investors implementing power projects. Many foreign developers had failed to empower project development, he said, adding that private involvement in the sector and methods of attracting private investment should be encouraged to enable development, investment and financing in the next 10 years.

This year’s VBF meeting followed the recent conclusion of Vietnam’s WTO-accession negotiations with the US, which have paved the way for the country to join the WTO before the year is out.

Vietnam has improved its investment climate in terms of creating new laws and improving the quality of the labour force and the nation’s infrastructure, resulting in increased investment flow in recent months, Deputy Prime Minister Pham Gia Khiem said. The National Assembly has passed major investment laws such as the Common Investment Law and the unified Enterprise Law and is now considering the Securities Law, the Information Technology Law, and the Real Estate Trading Law for approval.

"Our enterprises are also getting prepared to embrace regional and global integration," the deputy prime minister said.

Reports from the Japan External Trade Organisation (JETRO) show that investment-related costs in Vietnam remain lower than in many other countries in the region.

Oliver Massmann from Baker & McKenzie said investors were "quite optimistic in Vietnam," although he noted that investors wanted to see real commitment from Vietnam on how its plans would be implemented, saying that investors wanted to be sure about the future of any market they intended to invest in.

Baker & McKenzie’s Fred Burke said: "One of the indisputable goals of Vietnam’s socio-economic development strategy is to improve the country’s technological base and create an environment conducive to the advancement of technological development."

"The draft law on technology transfer introduces a new and unprecedented limitation on foreign service providers that has not existed to date in Vietnam and is unknown elsewhere," he said. Research on provincial competitiveness recently conducted by the Vietnam Chamber of Commerce and Industry and the United States Agency for International Development highlighted the importance of economic governance in improving business performance in certain provinces.

Source: VIR