Central city, Germany to speed up investment
The Investment Promotion Agency (IPA) of Da Nang and the Germany Business Association (GBA) have agreed to promote investment and field study exchange as well as connections among businesses in the two countries.
The proposal was discussed at the Memorandum of Understanding (MoU) signing ceremony in the central city last week between the two partners, offering investment opportunities for business partnerships between Germany and Da Nang in hi-tech industries, human resources training, information technology, logistics and seaport development.
IPA Director Huynh Thi Lien Phuong said German investment in Da Nang was still modest with 11 projects worth US$10.3 million – just 1% of the total FDI projects in the city.
She said the city has been calling for the development of a deep water seaport and logistics zone, as well as an airport to boost connections of multi-transport logistics industries.
Phương said the MoU would open the doors to possible investment projects from Germany in the micro-mechatronic engineering, precision electronics equipment production, sensors and software industries.
German businesses are operating in Da Nang creating sports shoes and sewing machine batteries.
The Central Agency for German Schools Abroad (ZfA) developed a pilot German teaching project at two junior secondary schools in the city in 2016, according to IPA.
Elmar Dutt, GBA co-chairman, said the association started activities in Vietnam in 1995, and the GBA has been the focal point of German business life, culture, and values in Vietnam for 28 years.
“We have helped German businesses in developing their operations in a wide range of fields and created opportunities for business and social exchange across Vietnam.
“GBA – one of the founding members of EuroCham Vietnam – has more than 350 members. Over 700 German enterprises call Vietnam their home, creating around 100,000 jobs and investing directly and indirectly to the country to the tune of US$10 billion,” said Elmar Dutt.
He noted that energy security was a major pain point in parts of Vietnam and the GBA encouraged all localities to increase resilience and ensure the stability of electricity supply to increase attractiveness for foreign investors.
Environmental protection and sustainability should also be priorities of all local, provincial, and national level government agencies. Pollution and other harms to the environment must be eliminated by regulations and more efficient enforcement, he said.
He urged simplifying and digitalising administrative procedures, in particular in the areas of customs, cross-border finance and operations.
“Our members face daily challenges in these areas resulting in delays, avoidable costs and a slow down of business activities. Some examples are red tape on promotions that involve discounts, VAT refunds, and customs clearance,” he shared.
He explained that it should eliminate local testing requirements for European Certified products in all sectors to foster free trade with the European Union. This would also make it easier to import necessary machinery and parts.
Elmar Dutt called for further easing of licensing, work permits and visas.
According to IPA, Da Nang saw a boom in the development of household rooftop solar power, but this was halted by a blockage in policy from the government.
Germany plans to open a representative office in Da Nang to boost cooperation and investment in the central coastal city and the central region as a whole.
Last year, IPA and Bremen's economic development agency BremenInvest signed an MoU on cooperation and investment promotion.
Vice Chairman of the municipal government Ho Ky Minh said the city has been calling for stronger and deeper investment from Germany and European countries in seaport development, infrastructure, hi-tech industry, education, and IT.
The city will create optimal conditions for German businesses seeking investment opportunities in the long-term in Da Nang, he assured.
Earlier this year, Da Nang had investment promotions with the United Arab Emirates (UAE), Japan, and the UK.
Da Nang and the UK city of Birmingham signed minutes on cooperation in five key sectors – economics, trade and investment; digital infrastructure construction, innovation and technology and fintech; education and training; sustainable development and circular economy; and sports, tourism and cultural exchanges – in March.
Six IZs and a high-tech park have attracted 503 projects, including 130 FDI worth US$1.8 billion and VND27.56 trillion (US$1.2 billion) from domestic investors.
The US-based aviation firm Universal Alloy Corporation, as well as Korea’s LG Electronics, have already started their operation in Da Nang, while Samsung Vietnam has launched its Innovation Campus in the city.