Saturday, September 8, 2007

Investment brokerage, new ‘job’ in Vietnam

11:38' 07/09/2007 (GMT+7)

The inauguration ceremony of two plants of Foxconn Group.

VietNamNet Bridge – At the recent groundbreaking ceremony of the two hi-tech plants of Taiwan’s Foxconn group, the busiest person was the Chairman of the Saigon Investment Group, Dang Thanh Tam, an ‘outsider’.

At the ceremony, Mr. Tam was busy shaking hands and speaking with foreign partners in Vietnamese, English, and Chinese. He was like the host of this event rather than a guest.

Mr. Tam didn’t hide his pride when he was praised for being a good broker who led the way for Foxconn to enter Vietnam.

“It began very simply. A Taiwanese official came to Vietnam to attend the APEC Summit in Hanoi last November and he then introduced Vietnam as an investment destination for his cousin, who came to Vietnam last December to survey the market. This cousin, Chairman of Foxconn group, Mr. Terry Guo, decided to invest in Vietnam after several days surveying this market,” Mr. Tam reminisced.

When the Chairman of Foxconn paid a visit to the north of Vietnam in late 2006, the Saigon Investment Group was the organiser of this trip. After returning to Taiwan, Mr. Terry Guo sent his representatives to Vietnam once again to seek more information and this time Saigon Investment Group was also the information supplier.

Mr. Tam said that it was not easy to convince Taiwanese investors. “Though they had our reports already, they still hired others to verify our information,” he said.

Investment brokerage – a difficult job

The people who play the role of investment brokers must have broad relations and especially relations to important persons to be able to convince foreign investors. They also have to be experts of local laws and investment processes.

There was a case in which a province had only attracted $20 million over 20 years and when a big foreign investor came to seek information about the province’s investment climate, local officials didn’t know what to do. Mr. Tam, who worked as a lawyer in the past and had 10 years of experience in investment promotion, helped the province in this task. He explained to foreign guests about the development of the province, its labour forces and even wrote reports and sent them to the investor.

Le Huu Quang Huy, Director of the Investment Promotion Centre of the Central Region, said that investment promotion was no longer as simple as organising workshops to introduce the potential and then wait for foreign investors to come. Investment promoters now have to supply foreign investors with detailed information about each project.

Mr. Huy has many times brought foreign investors to potential areas for investment in the central region. Most recently, he hired a naval ship to bring investors to wild areas of the central province of Thua Thien-Hue and the Central Highlands province of Khanh Hoa. He also paddled in shallow water with guests on a field trip. Finally, the representative of Singapore’s Bonwest Holdings decided to invest in a resort on nearly 100ha of land in the central region instead of on 15-20ha as his previous plan.

Head of the Foreign Investment Department under the Planning and Investment Ministry, Phan Huu Thang, commented that personal relations in investment promotion were very important. Sometimes regional investment promotion centres are unable to cover everything so they need brokers who have broad relations and high prestige in the circle of investors.

“In some cases investors know those brokers’ reputation so they directly make contact with them to be consulted about the investment environment in Vietnam,” said Mr. Thang.

Mr. Dang Thanh Tam said that when meeting with foreign partners, only focusing on the goal of inviting investment into a project is not good enough. At the beginning when he worked as a ‘broker’ for foreign investors, he didn’t think that they would invest in his industrial zone or any others but investing in Vietnam is okay. However, gradually he realised that acting as investment brokers could bring prestige for himself and his company.

“Now many local and foreign companies know me as an investment broker,” he said proudly. Moreover, many foreign investors have cooperated with his company, the Saigon Investment Group, to perform investment projects in Vietnam.

The Saigon Investment Group has recently signed an agreement with the US’ TETCO to invest in the HCM City Hi-tech Park and with the Foxconn Group to implement a thermo-power project in Binh Dinh province.

Mr. Tam revealed that in late September 2007 he would lead the representatives of some American hi-tech companies to survey the investment environment of HCM City.

According to the Foreign Investment Agency, around 50 projects worth $50 billion are being promoted. The country’s plan to attract $12 billion of foreign investment capital in 2007 is feasible because the volume of foreign capital drawn in the past eight months is on par with the plan and many big projects can be licenced from now to the year’s end.

The top official of the Foreign Investment Agency, Phan Huu Thang, said that investment brokerage was welcomed if brokers understood the laws and were warm-hearted about attracting foreign investment for Vietnam. When Vietnam is exerting itself to draw foreign investment, it is better to have more resources contributing to call for investment

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