How to exploit Vietnam-Singapore economic cooperation

• Singapore invests big in Vietnam
• Vietnam - Singapore forum a chance to strengthen economic ties
• Singapore’s Mapletree acquires Kumho Asiana Plaza in Saigon for $215 million

Singapore is Vietnam's largest investor in the ASEAN region and the third largest in the world, but Vietnam still needs to improve its investment environment to make the most of the two countries' economic potential.

Vietnam is considered one of the most promising emerging markets in the world, but changes to the investment environment such as cutting procedure times and the licensing process are necessary to make the most of its potential, Benjamin Yap, senior partner at RHT Law Taylor Wessing told VnExpress Internaitonal on the sidelines of Vietnam Singapore Business Forum.

With 1,663 projects and total investment capital of $38.1 billion as of July 20, 2016, Singapore has invested in infrastructure, oil and gas, real estate, health care, hospitality, education, food and beverages, logistics, technology, telecommunications and media,” said Yap.

The island nation has recently turned its attention to real estate project, with properties giants like Mapletree, Keppel Land, CapitaLand and Ascott Limited all expanding in Vietnam, especially through sizable acquisition deals in Ho Chi Minh City. Vietnam Singapore Industrial Parks (VSIP) also now has seven parks nationwide and total capital of more than $8 billion. 

Singapore is the world's third largest investor in Vietnam.

The average investment for projects from Singapore is $23 million, but this is not at its full potential as barriers still exist. Yap told VnExpress International that: “Perception from many Singaporean investors is that the investment and licensing process is very bureaucratic.”

“Whereas there is a perception from many Vietnamese that foreign investors take too long to invest in Vietnam, the reality is that foreign investors have additional criteria to satisfy which Vietnamese investors do not. There needs to be more dialogue to improve this,” Yap added.

Comparing the administrative systems in two countries, Yap told VnExpress International it is really challenging for Singaporean SMEs. “Procedurally, the gulf between the way licensing is carried out in Singapore and Vietnam is big. Our two systems are different and the way regulators approach this is very different." 

“Vietnam has taken significant strides to make the process more user friendly and it should continue to streamline the process. This is important given that business cycles and reaction timelines are getting shorter and shorter. This is especially true in the technology, media and telecommunication space,” he underlined.

Besides the demand for these improvements, Vietnam needs to enhance its education and training system to provide a workforce capable of meeting the requirements of international integration.

“More can be done to encourage vocational training. There is a need for more foreign investment in this space. More can also be done to embrace international education methods which has and continues to evolve. The challenge is for the Vietnamese education system to embrace and adapt,” Benjamin Yap concluded.

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> Singapore invests big in Vietnam

> Vietnam - Singapore forum a chance to strengthen economic ties

> Singapore’s Mapletree acquires Kumho Asiana Plaza in Saigon for $215 million