Attracting foreign investment is not only aimed at economic growth but also at improving the quality of development through technology and knowledge. To achieve this, the State needs to shift from a passive management role to a creative one, focusing on administrative procedure reform and effective supervision. DNP Viet Nam Law Firm will accompany FDI enterprises, providing related detailed content.
1. Current status of administrative procedures for FDI:
1.1 Positive side:
In recent years, our country has made many remarkable improvements in reforming administrative procedures related to foreign investment, specifically:
- Open policy: Applying the Investment Law 2020 and Decree 31/2021/ND-CP.
- Investment incentives: Tax exemption and reduction, land support according to Decree 10/2024/ND-CP and Decision 1018/QD-TTg.
- Procedural reform: Shorten approval time to 15 days according to Decree 19/2025/ND-CP.
1.2 Limitations:
Despite reforms, administrative procedures for FDI are still cumbersome and inconsistent among localities. Some unclear regulations cause difficulties for investors in project implementation. Specifically:
- Procedures are still complicated and overlapping.: Investors have to go through many steps, from applying for an investment certificate to registering a business.
- Processing time is not stable: Although there are specific time regulations, in practice it is often extended due to additional requests or slow processing.
- Project adjustment is difficult: Procedures for changing capital, investors, locations, etc. require a lot of paperwork and have not been simplified.
- Lack of consistent and transparent policies: Investors find it difficult to predict due to rapid policy changes and lack of transition period.
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2. Administrative reform and content of administrative reform in the field of foreign investment:
2.1 Concept of administrative reform:
Administrative reform in a broad sense is the process of comprehensively and systematically innovating the constituent elements of the state administration, including: administrative institutions, organizational structure, civil servant staff, public finance, administrative procedures and management methods, aiming to build a democratic, clean, professional, modern, effective and efficient administration.
2.2 Contents of administrative reform in the field of foreign investment:
a. Institutional reform:
- Require state management agencies to continue reviewing laws and policies to amend or eliminate conditions for applying investment incentives that are inconsistent with Vietnam’s commitments to the WTO and have solutions to ensure the rights of related investors.
- Regularly monitor and supervise the implementation of laws on investment and enterprises to promptly detect and handle arising problems.
b. Reform of administrative apparatus:
- Implement clear decentralization between the central and local governments, enhance the responsibility and authority of local governments associated with the people.
- Streamline government agencies; encourage non-governmental organizations and social organizations to participate in consulting, avoiding nationalization.
- Narrowing the functions but strengthening the State’s tasks in developing the market and ensuring welfare for the people.
c. Innovation and improvement of quality of staff and civil servants:
- Improve the qualifications of officials and civil servants to meet the requirements of the Investment Law and decentralization of FDI management.
- Institutionalize standards and titles of officials and civil servants.
- Apply a clear civil service regime regarding functions, powers, responsibilities and evaluation criteria according to job positions.
d. Public finance reform:
- Reform tax policies in accordance with market mechanisms and international practices.
- Increase the efficiency of mobilizing and using ODA capital for large-scale infrastructure projects in transportation, electricity, irrigation, health care, and education.
3. Solutions and recommendations to improve:
3.1 Solutions and recommendations to improve state management of foreign direct investment activities
| Solution | Recommendation for improvement |
| – Complete the system of documents to institutionalize and direct the implementation of the Central Committee’s policies and resolutions on improving the quality and effectiveness of foreign investment cooperation. – Continue to promote administrative reform, remove difficulties and obstacles for FDI enterprises. – Strengthen inspection, supervision and strict handling of violations. Especially issues related to investment policy approval and issuance of investment registration certificates. | – Promote digitalization of administrative procedures via blockchain and establish a policy feedback mechanism from FDI enterprises. – Focus on vocational training under the PPP model, especially in the fields of semiconductors and AI to solve the shortage of engineers. – Prioritize regional transportation connections, logistics centers and digital infrastructure development. -Build a multi-layered investment guarantee mechanism, stabilize tax and land policies, and apply international standards in dispute resolution. |
3.2 The Role of the Public and Private Sectors in Enhancing National Competitiveness
Improving the investment environment in Vietnam requires not only the State’s efforts in institutional reform, infrastructure development and legal framework, but also proactive support from the business sector, especially the FDI sector. Close coordination between the public and private sectors will be the key for Vietnam to improve its competitiveness, attract high-quality capital flows and catch up with the global investment shift trend in the coming period.
The information above is for reference only. If you require further details, please contact us using the information below.
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