TEAM DISAGREE

Foreign Direct Investment is Detrimental to

Vietnamese Companies and Wider Society

Our Argument Points

Argument Point Speaker

FDIs bring employment opportunities and human capital Shafiar
development (e.g. employee training)
Bring technology transfer and new capabilities TJ
Bring potential accelerated economic growth (e.g. GDP Shadman
growth)
Strengthen human rights Lorenz
Strengthen environmental laws Vi
Promote more ethical business practices, aligned with Katie
internationally accepted standards
Increased international business network opportunities Shadman
Increased awareness of cross-cultural business and social Vi
behaviours (creative capital?)
Improved policy making capabilities of the country Lorenz
“Where there is trade, there is peace” Improved bilateral Shafiar
relationships
Improved country infrastructure from FDI TJ

 Statistics from the Ministry of Planning and Investment (MPI) show that from
pledged and disbursed FDI of US$1.56 billion and $262.5 million, respectively,
in the 1988-1990 period, the 30th anniversary of the FDI law in 2017 saw the
figures hit record highs of $35.88 billion and $17.5 billion.
 Firstly, FDI provides important capital to improve Vietnam's economic growth. The FDI inflows
into Vietnam have created a boost for Vietnam's economy in the context of low savings of
economy for investment. In the period 2000-2018, FDI accounted for an average rate of 21.3% of
 the total investment of the economy (see Figure 2). The average growth rate of FDI reached
18.3%, higher than the average growth rate of the total investment of the economy (15%).
 Secondly, FDI creates jobs for Vietnamese laborers. Up to now, there are more than 4 million
direct employees in FDI enterprises. Besides, FDI enterprises also have pervasive influence and
create significant indirect jobs for the Vietnamese economy. By means of working in FDI
enterprises, Vietnamese laborers also receive advanced foreign business knowledge and
management skills from foreign investors, thereby increasing their capacity.
 Thirdly, FDI enterprises contribute to promoting export, expanding foreign economic relations
and improving Vietnam's competitiveness in the process of international economic integration.
FDI enterprises have a large export turnover, accounting for about 75% of the country's total
export turnover up to now.
 Fourthly, FDI activities contribute to the transfer of advanced and high technology to Vietnam.
FDI is an effective technology transfer channel that many countries, especially developing
countries, have paid attention to and issued many policies to encourage in order to achieve the
goal of strengthening national technological capacity. For Vietnam, through attracting
international investment flows, Vietnam has the opportunity to receive source technology from
developed countries. Many economic sectors of Vietnam have received and approached the
world's modern technology such as banking, post and telecommunications, oil and gas,
transportation, etc.
 In the first 11 months of 2020, foreign investors invested US$17 billion in Vietnam
with a significant portion of these projects targeted at manufacturing, processing,
real estate, and electricity production and distribution.
 Statistics from the Ministry of Planning and Investment (MPI) show that from pledged
and disbursed FDI of US$1.56 billion and $262.5 million, respectively, in the 1988-
1990 period, the 30th anniversary of the FDI law in 2017 saw the figures hit record
highs of $35.88 billion and $17.5 billion.
 By 2025, Vietnam’s digital economy could expand to US$52 billion. Sub-sectors of
the digital economy such as e-commerce, digital banking, and online gaming
represent nascent and high-growth areas of consumer demand that investors could
target. Therefore, while the Vietnamese consumer remains a driver of FDI, it is
possible that the routes foreign firms need to take to reach the consumer could
change.

Bring potential accelerated economic growth:

The economy is one of the most important if not the single most important reactor
towards a nation's prosperity. Vn is no exception. And we strongly disagree with the
motion.
Back in 1986 the pathway to FDI in Vietnam was led by introducing Doi Moi. Looking at
the statistics from the Ministry of Planning and Investment (MPI) show that from pledged
and disbursed FDI of US$1.56 billion and $262.5 million, respectively, in the 1988-1990
period, the 30th anniversary of the FDI law in 2017 saw the figures hit record highs of
$35.88 billion and $17.5 billion.
The FDI sector has contributed 20 per cent to GDP growth, 50 per cent to industrial
output, 70 per cent to export turnover, and created 13 million direct and indirect jobs.
The Government’s affirmation that the success of FDI is also the success of Việt Nam is
testament to the importance the sector is accorded.
By 2025, Vietnam’s digital economy could expand to US$52 billion. Sub-sectors of the
digital economy such as e-commerce, digital banking, and online gaming represent
nascent and high-growth areas of consumer demand that investors could target.
Therefore, while the Vietnamese consumer remains a driver of FDI, it is possible that
the routes foreign firms need to take to reach the consumer could change.

Ethical Business Practice (US Department of State) Speaker 3 - Katie

A current shift social expectations around business responsibilities in Vietnam.
Slowly starting from the Doi Moi policy. Promote more ethical business practices,
aligned with internationally accepted standards.

In Vietnam, most multinational companies implement:

- Corporate Social Responsibility (CSR) programs that contribute to improving

the business environment,
- Applying the Sustainability Accounting Standards Board (SASB) & GRI
standards into their annual report
- OECD Due Diligence Guidance for Responsible Supply Chains of Minerals
from Conflict-Afflicted and High-Risk Areas.
- The 2005 Law on Enterprises in theory regulates corporate governance in
line with OECD corporate governance principles.
- The regulations on the labor rights (Labor Code) which ethically improve the
labor relationships arising in labor using process
The Vietnam Chamber of Commerce and Industry (VCCI) conducts CSR training and
partnership with the UN, & AmCham has a CSR group that organizes events and
activities to raise awareness of social issues. Non-governmental organizations
collaborate with government bodies, such as the VCCI and the Ministry of Labor,
Invalids, and Social Affairs (MOLISA), to promote business practices in Vietnam in
line with international norms and standards. Discussions on ethical business
standards during negotiations of the Trans-Pacific Partnership (TPP) and the CPTPP.

=> raise awareness of CSR programs is increasing among large domestic companies
such as Vingroup with its Sustainable Finance Framework, Vietjet with its
sustainable development annual reports.

Vietnam may make additional strides in labor rights and ethical business practices
in its revised Labor Code, due for discussion by the National Assembly in 2019.

Decree 158/2016/ND-CP came into effect in January 2017 and provides guidelines
for implementing the Mineral Law, which may improve transparency in the mining
sector.

The Penal Code 2015, which went into effect on 1 January 2018, criminalizes
bribery, which is defined as a person in a position of power receiving a payment of
VND2 million or more to do or to refrain from doing something, for the benefit or at
the request of the person making the payment.

The Anti-Corruption Law 2018 went into effect on 1 July 2019 and requires all non-
state enterprises and organisations to establish an anti-corruption compliance
programme. All enterprises and businesses must issue an Anti-Corruption Code of
Conduct which addresses conflicts of interests and corrupt acts and promotes a
corporate culture which discourages corruption. This Code of Conduct should also
address business ethics applicable to employees and management.
 TEAM AGREE

Coronavirus demonstrates that the vulnerabilities and risks created by trade

and economic integration outweigh the benefits

Our Argument Points

Argument Point Speaker

“Free flow” of trade and “openness of economies” have led
inevitably to the accelerated spread of the virus.
Shortage of essential goods in specific industries, e.g.
Pharmaceutical products
Re-locating of critical/essential industries back to home
country, and not depend too much on GVC
Over-dependency on China and India – breaking down of
global supply chain (e.g. mobile phones, batteries in
Bangladesh)

Trade and Economic Integration – Vulnerability and Risks were greater than
Benefits

Economic Impact - Katie

Political Impact --- Shadman
Social Impact
Environmental Impact