Vietnam Ethnic Minorities Set for Added Investment

Vietnam will increase its foreign invested capital from Australia, South Korea, and Japan to ethnic minority areas, contributing to socioeconomic development.

The Department of International Cooperation under the government’s Committee for Ethnic Minority Affairs (CEMA) and the Institute of International Investment Studies (ISC), signed a cooperation agreement to foster investment in mountainous and remote areas facing massive difficulties.

According to the agreement, the two parties will work together to support mountainous localities to improve the quality and effectiveness of foreign investment cooperation and investment in mountainous provinces.

The CEMA functions as the focal point of the government to manage ethnic affairs throughout the territory of Vietnam. It coordinates with localities to initiate and develop programmes and projects to attract resources to support investment in socioeconomic development in ethnic minority areas, but mainly through capital channels such as official development assistance (ODA) for Vietnam.

“To exploit the great potential and sustainable development of ethnic minority areas, in addition to ODA resources, we need other foreign investment,” said Dr. Hoang Van Xo, general director of the Department of International Cooperation. “The signing of the Memorandum of Cooperation is the basis for implementing activities to support mountainous localities in improving the quality and effectiveness of investment cooperation with foreign countries and promoting investment in mountainous provinces, under the policies of our Party and state.”

According to the plan, in 2024, the department and ISC will cooperate to call projects in two or three provinces.

Implementing the Party and government’s policies on mobilizing resources for socioeconomic development in ethnic minority areas, the Department of International Cooperation has promoted and worked with international agencies and organizations at home and abroad, actively supported and coordinated with localities, mobilized and attracted resources such as ODA, and foreign investment and other legal resources, including activities to improve investment in ethnic minority and mountainous provinces.

In late July, Minister-Chairman of the Committee for Ethnic Minorities Affairs Hau A Lenh will lead a delegation to participate in a working trip to Australia, Dr. Xo said. “I am also a member of this trip. The Committee for Ethnic Minorities Affairs will work with the departments of foreign affairs and trade and local authorities in Australia to accelerate the signing of bilateral trade and investment agreement,” he added.

“Before the working trip, we will invite the representative of the Embassy of Australia to Vietnam to work and discuss the pending issues relating to this bilateral agreement to ensure the signing ceremony in Australia goes smoothly.”

The eagerness to bring foreign investment to disadvantaged localities is part of efforts in fostering socioeconomic growth and one of the most important priorities of the government.

Many NA deputies last week focused their discussion on adjustments to the investment policy for the national target program on socioeconomic development in ethnic minority-inhabited and mountainous areas in 2021-2030.

Vietnam includes 54 ethnic groups, of which the Kinh people account for 85% of the population with 78.32 million people, while the remaining 53 are ethnic minorities, responsible for 14.6% of the country’s population.

The foreign investment inflows in the disadvantaged provinces are modest. The northern midland and mountainous provinces are an example. According to the Foreign Investment Agency under the Ministry of Planning and Investment, by the end of 2023, the northern midlands and mountainous provinces attracted about 1,240 foreign-invested projects with a total registered capital of nearly $29 billion.

With this result, the northern midlands and mountainous regions ranked fifth out of six economic regions of the country in terms of foreign investment attraction and accounted for only 3.4% of the total number of projects; and 6.2% of total foreign direct investment capital invested in Vietnam.

“The statistics indicate that foreign investment in ethnic minority areas is not commensurate with its potential. Restrictions of a soft nature on knowledge, skills, and experience have impacted and adversely affected foreign investment. Thus, we will focus on training legal knowledge, and state management skills on foreign investment and investment promotion operations for officials in mountainous provinces,” said Phan Huu Thang, chairman of the ISC.

Along with the investment promotion activities and development of human resources, NA deputy Truong Xuan Cu representing Hanoi said that investing in education for talented ethnic minority students is one of the crucial missions.

“We can use budget funds or have training contracts with high schools for the gifted under universities in major cities. We will also send qualified individuals and excellent ethnic minority students to study in countries that share borders with their localities to create human resources to contribute to international integration in border provinces,” Cu said.