[Vnbiz] Business leaders say more reforms are needed to sustain Vietnam's boom

[Phan, Tai]

Business leaders say more reforms are needed to sustain Vietnam's boom
The Associated PressPublished: December 13, 2006



HANOI, Vietnam: Leaders of government, business and international aid organizations praised the rapid improvements in Vietnam's business environment Wednesday but warned that further reforms are necessary to keep the economic momentum going.

A parade of speakers at the annual Vietnam Business Forum congratulated the communist nation for its imminent entry into the World Trade Organization, which takes effect early next year, and its successful hosting of the Asia-Pacific Economic Cooperation summit last month.

They also noted that foreign investment is at record levels, the fledgling stock market is booming and that economy is growing at one of the fastest annual growth rates in Asia - over 8 percent.

"There is no doubt that 2006 has been a pivotal and high-profile year for Vietnam," said Mark Farquhar, chairman of the Australian Chamber of Commerce in Vietnam.

But Farquhar and other business leaders expressed concerns about corruption in Vietnam as well as weaknesses in its legal systems and infrastructure. Substantial improvements have been made, they said, but more work remains to be done.


 Qantas rejects takeover bidVietnam has passed many good laws on investment, corruption, intellectual property rights and business registration, they said, but enforcement of these statutes is uneven and unpredictable.

"Investors need to know that the contracts they sign will hold up under the law and that disputes will get settled in a fair way," said David Knapp, chairman of the American Chamber of Commerce in Vietnam.

In general, forum participants were upbeat about Vietnam's prospects.

Yashiro Hiroaki, head of the Japan Business Association in Vietnam, noted that the country overtook Thailand last year to become the third-most popular investment destination in the world for Japanese companies, behind only China and India.

"With Vietnam about to become the 150th WTO member, the United States granting permanent trade relations status to Vietnam and foreign direct investment at a record high of $9.5 billion, we are hoping to have a new wave of investment into Vietnam," said Vo Hong Phuc, the minister of planning and investment.