Vietnam's tax and customs regulations are among the most complicated in Asia-Pacific while government support for investors is hard to access, a new survey of Japanese companies has found.
The country has been ranked at number six out of 15 countries in the region in terms of the complexity of tax and customs procedures, according to the survey released by Japan's trade promotion agency JETRO on Thursday.
Atsusuke Kawada, representative of JETRO in Hanoi, said 52.7 percent of 458 surveyed companies complained about the regulations.
Regarding the entire legal system, 60.3 percent of the firms said it is not complete and is not operated in a transparent way.
Yasuzumi Hirotaka, JETRO representative in Ho Chi Minh City, also said Japanese companies have difficulties in investing in supporting industries, which produce materials and components that will be used later in the assembling of finished products.
Vietnam government has announced various policies about drawing investment into supporting industries, but it’s very hard for Japanese firms to access those policies, he said.
So far, there’s only one Japanese firm that has received government support in this area, he said.
Hirotaka warned that Vietnam’s supporting industries are underdeveloped, which will turn foreign manufacturers to other countries.
According to the JETRO survey, Japanese investment into Vietnam has dropped from US$5.8 billion in 2013 to around $2 billion last year.
JETRO representatives recommended that Vietnam take measures to deal with red tape and clarify its regulations, as 66 percent of the Japanese firms still want to expand operation in the country.