The state leader made the statement while receiving a delegation of entrepreneurs who are participating in the second Viet Nam Investment Forum held by the State Capital Investment Corporation and the UK-based Euromoney Conferences.

The president said that although Viet Nam’s national economy was changing into a market economy, the country had consistently pursued its goal of advancing towards socialism.

He said that Viet Nam had learned about economic development from other countries but what’s noteworthy in its economic development is that it attributes more attention to the development of education and health care, as well as the improvement of living conditions for the people.

According to the president, to ensure that economic benefits are given to people from all strata, Viet Nam has always created favourable conditions for businesses to develop.

These businesses will then make more contributions to the State budget for the poor.

The Party and the State have launched various campaigns to call for the assistance of the poor, and its poverty reduction programme has been praised by the United Nations.

Regarding the country’s policies for investment in education, Triet affirmed it was the nation’s top priority. Viet Nam spends almost 20 per cent of its State budget on education.

Explaining a regular dialogue mechanism between investors and relevant Vietnamese agencies, President Triet said that if facing any difficulties, investors in localities could contact their local authorities or relevant ministries and departments. For much more important issues, investors could propose meetings with the Prime Minister or the President. "Viet Nam respects investors and leaders at all levels are willing to share and solve difficulties to help investors better operate, thus contributing to the country’s development," he said.

Regarding the State’s policy on Vietnamese expatriates, the President affirmed that the Communist Party and State value the role of overseas Vietnamese and consider them an inseparable part of the Vietnamese community. "The Communist Party and State call for Vietnamese expatriates to contribute to building the homeland," he said.

Investors expressed their admiration at Viet Nam’s economic growth rate as well as their affirmation of the Vietnamese leaders’ sound policy.

Capital demands rise

Viet Nam’s demand for investment capital could reach VND140 billion in the 2006-10 period, said Finance Minister Vu Van Ninh at the Annual Viet Nam Investment Forum in Ha Noi.

The forum opened yesterday with the theme Financing Growth-Asia’s Next Tiger.

The minister emphasised that the Vietnamese Government had pledged to continue integrating into the world market, improve its legal system, reform administration processes and become more transparent to attract domestic and foreign investors to Viet Nam.

Adding to the capital market’s development was the sale of bonds, accounting for more than half the market’s success at US$8 billion. Some 400 kinds of bonds were available to purchase, with 90 per cent listed by the Government, said Ninh.

"Current figures show 49 per cent of the participants in the Vietnamese stock market are foreign investors," said the minister.

A difficult road

According to Ninh, the Vietnamese economy still faces challenges like poor infrastructure and a need for social and legal stability.

But these issues could be overcome now that Viet Nam is a member-country of the World Trade Organisation (WTO). This status would bring many opportunities for the country in general, particularly in the financial sector, said Ninh.

"To integrate into the world’s financial markets, policies need to be in place to implement WTO commitments in fields like securities, finance and banking insurance." he said.

Le Thi Bang Tam, chairwoman of the State Capital Investment Corporation (SCIC), said Vietnamese companies used 2006 to prove their worth with a combined capital of $15 billion raised last year.

"Many larger State-owned enterprises are now looking to equitise and sell shares on the stock market to increase their capital". The country would need a large amount of investment funds in the next decade, especially in strategic sectors like banking, finance and hi-tech products, she said

As a strategic investor created by the Vietnamese Government, SCIC helps the State make sure the economy grows in a sustainable way.

Tam said investors would be willing to invest in Viet Nam because it’s developing a healthy business climate and fair playing field.

William Lean, managing director and head of Viet Nam Infrastructure Limited (VinaCapital), said investment in infrastructure here was a big opportunity. Inviting experts in this field to Viet Nam could help the nation learn important skills like project management, he added.

According to Lean currently, Viet Nam depends on official development assistance to deal with restoring infrastructure, without much help from private or foreign investors.

This would need to change if the country wants to restore its cities to their former glory, he said. This was part of the reason VinaCapital set up an infrastructure development fund, said Lean.

Forum hosts

Michael Geoghegan, the group chief executive of HSBC Holdings, welcomed forum participants by saying, "The vitality of the Vietnamese economy and the superb growth rates that you are achieving is making Viet Nam an economic force to be reckoned with."

"Viet Nam’s economic renaissance is a tribute to the way in which Viet Nam has transformed its economy in the last 20 years, since the start of the doi moi (renewal) process in 1986," said Geoghegan.

Maintaining the momentum in the equitisation programme would be another factor in the ongoing process to lure new investment. By equitising more than 3,000 State-owned enterprises, the Government had made impressive progress, but it would be vital the programme continues at the same pace, said he.

"An increasingly well-educated workforce is another advantage. Impressive progress has been made in improving education at the primary and secondary level, with adult literacy levels at more than 90 per cent. However, a key feature of the successful tiger economies has been the way they have increased the skill levels of their workforce. That means businesses in Viet Nam will increasingly be looking for employees with higher level qualifications".

Source: VNAgency