(L-R) Mr. Ralf Matthaes, Ms. Winnie Lam, and Mr. Frederick Burke answering questions from media
This year will prove to be better year for the Vietnamese economy than 2012, but not without problems, experts said at a Canadian Chamber of Commerce event on January 23 at the New World Hotel.
Thanks to its attractive assessment, Vietnam is receiving more inquiries from foreign investors.
However, the country's highly complicated investment and labor laws discouraged many investors that ended up turning other countries like Myanmar and China.
"The government needs to understand that as a foreign business, we are very willing and very prepared to follow all the rules as long as they are within reason and achievable," said Winnie Lam, head of the Group Business Development & Marketing at payroll services provider KCS Vietnam.
A large market for exported products may also be lost if Vietnam is excluded from the Trans-Pacific Strategic Economic Partnership Agreement (TPP), said Frederick Burke, Managing Partner of Baker & McKenzie.
While Vietnam has been involved in the TPP talks since their inception, Burke warned that the exclusion had an unfortunately high likelihood of taking place, for many reasons, from opposition of the textile industry in the US to the Vietnamese government's unwillingness to further open its market to foreign competition.
As exportation continues to drive of Vietnam's economy, this may prove a hindrance to the country's growth, he said.
"We are doing very well exporting seafood, but if we lose our level playfield and others can export at 28 percent less than we can because they are TPP signatories, then we may never catch up," said Burke.
Despite all these problems, experts still expressed high hopes for the coming year, taking into account that the Vietnamese economy may be at a low point.
Mr. Andy Ho, Managing Director and Chief Investment Officer of VinaCapital estimated that the GDP growth for 2013 will be around 5.7 percent, with 7-8 percent inflation and the CPI at 7.5 percent, all improvements over 2012.
"When the Prime Minister openly admitted that the economy had been mismanaged, I think that was the first sign that change is coming," said Mr. Ralf Matthaes, Regional Managing Director of TNS.
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