Vietnamese Doing Business In Laos, Cambodia Tougher

Vietnamese investors have found it harder to do business in Laos and Cambodia as the two countries recently changed policies on land, natural resources and minerals management.

The Ministry of Planning and Investment last Friday chaired a forum on investment cooperation in the Mekong Sub-region 2012 in Buon Ma Thuot City in Daklak Province under the theme of situations and investment cooperation prospects in the development triangle area of Cambodia, Laos and Vietnam (CLV).

Speaking at the forum, deputy minister Dao Quang Thu said several projects of Vietnamese investors in Cambodia and Laos have been rejected in spite of signed memorandums of understanding.

At the moment, Vietnam mainly invests in industrial plants and mineral exploitation in Laos and Cambodia. However, the investment environment in both nations in the two sectors is changing.

For instance, the Cambodian government no longer encourages investors to exploit wood and to export unprocessed minerals. The Government now doesn’t support investors to make site clearance in areas where local residents have resided for many years.

Similarly, the Lao government has stopped considering and granting investment certificates to new projects in the fields of exploring and surveying metal and non-metal ores. Also, it has halted scrutinizing projects to plant rubber and eucalyptus and has banned the export of crude ore among others.

However, what has enraged Dinh Van Khiet, vice chairman of DakLak Province, is that Cambodia had allocated land for Vietnamese investors in a signed MOU - but instead gave the land to a rival foreign investor. Regarding this issue, an official of the planning and investment ministry told the forum that the Lao and Cambodian governments had complained about the later-than-expected implementation of many projects with involvement of Vietnamese firms.

According to the ministry, provinces of Vietnam in the triangle area have attracted 129 projects from 19 nations, with five projects from Laos and two from Cambodia. In the meantime, Vietnam has invested in 75 projects in Laos and Cambodia, with total investment of over US$3 billion.

At the forum, Vietnam-Laos-Cambodia Association for Economic Cooperation Development proposed member nations’ governments map out special incentives for the CLV region. The association also urged the competent authorities to improve and develop the traffic systems linking the nations.

At the same time, the ministry announced comprehensive zoning plans on socio-economic development in the central Highlands, southeastern region and the Mekong Delta by 2020. Local economists expected the plans to help the three regions develop at a fast pace if successful but they also said it will be very difficult to achieve this.

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