POSITION PAPER FROM THE BRITISH BUSINESS GROUP VIETNAM (BBGV) AT THE MIDTERM VIETNAM BUSINESS FORUM 2019

The British Business Group Vietnam extend their greetings to the Chairs and Co-chairs of the Vietnam Business Forum. 

We also congratulate the Government on their continued progression to a more open and transparent business environment.

We would like to bring to the attention of the Government the following issues which have been raised by our members:

  1. Education

BBGV is pleased to note that Education remains a high national priority. Opportunities for business engagement are available in a variety of areas including English language training, teacher training, quality assessment, digital learning, educational materials, and transnational education. With more than 23 million students, 1.2 million teachers and instructors, Vietnam offers a very active market for both student mobility and educational partnership activities, of which the UK has a market share of 9%.

The strong commitment to educational overhaul by reforming legislative regulations and encouraging foreign investment, such as the amended decree 86 which lifted the ratio of students enrolled in international schools is to be commended.

Current international and transnational education programmes between Vietnam and UK are strong with 475 approved and 310 remaining active. Approximately 12,000 Vietnamese students are based in the UK for their studies. Regarding professional training, the UK establishments and businesses are very willing to offer their expertise whilst also building and extending partnerships with local companies, schools, colleges and government departments across several sectors including Tourism & Hospitality, IT, Logistics, Automotive, Mechanics, Finance & Accounting, Marketing and Communication, English language and other soft skills.

At the 16th Education World Forum in London earlier this year a delegation of around 100 Vietnamese universities and business representatives travelled to the UK and 29 MOUs were signed between various stakeholders in education which demonstrate strengthening educational ties between the two countries. Agreement was reached to strengthen UK/Vietnamese co-operation to deliver high quality, inclusive education to Vietnamese students under its current education reform programme.

BBGV believes that jobs in Vietnam are at risk from the 4th Industrial Revolution, strengthened technical and vocational training is required to address social and economic needs. There is a demand for on-the-job learning services, especially in business, management and other sectors such as logistics and IT. This in turn requires more teachers/trainers who can deliver international training programs to enhance skills and be certified internationally.

  1. Agricultural Products

Trade in agricultural products remains a point of concern for many UK companies.

In the export of agricultural product from Vietnam TO EU countries including the UK, the EU country accepts the Vietnamese issued Phytosanitary certificate. However, in the export of agricultural product FROM EU countries to Vietnam, the EU country is required to issue a Phytosanitary Certificate. The product may then remain in customs incurring storage charges until a VIETNAMESE phytosanitary certificate is issued with the associated waiting time and cost.

To import a food product from an EU country into Vietnam it is necessary to apply for a licence. This process can take several weeks and require expensive laboratory testing of a sample of the product. This licence covers only one form of the product, so each different form of packaging needs a separate licence for the same product and is specific to a named producer.

This process is not required in EU countries in the issuing of an import licence for a Vietnamese food product.

This process presents a barrier to trade and makes importation to Vietnam slow, costly and bureaucratic whilst Vietnamese exporters do not face the similar barriers.

  1. Energy

BBGV is pleased to acknowledge the continued strong growth of the Vietnamese economy, however a weak grid infrastructure coupled with the demand for electricity growing at 12%, businesses potentially face a major energy challenge. The current Power Development Plan foresees the proportion of energy from coal growing from 49% in 2020 to 53.2% in 2030. This will add to the pollution issue faced in the major cities. Vietnam offers a good potential for renewables energy alternatives but must consider incentives for energy efficiency and private sector investment.

Investors are concerned about Vietnam’s low Feed-in-Tariffs and the bankability of the Power Purchase Agreements. Developers can only sell to the state-owned monopoly power provider EVN (Vietnam Electricity) which receives no sovereign guarantees from the Vietnam Government.

To unlock renewable energy projects Vietnam needs power pricing reform, good market regulation and more access for the private sector for blended finance products. BBGV supports a move to electricity pricing model that is based on a market pricing system. This would also encourage more private investors to enter the renewables market. A refresh of the pipeline of solar projects awaiting government approval and more ambitious revisions to the Power Development Plan would also. As well as considering pricing, encouragement and focus also needs to be given to simulate energy efficiency.

UK companies are keen to work with Vietnamese partners and to invest in Vietnam at the recent Low Carbon Energy Conference in Hanoi over 30 UK renewable energy companies met with Vietnamese public and private energy sector representatives.

We thank you for allowing us to present our views and issues and wish you all good health and prosperity.

Peter Rimmer
BBGV Executive Director

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