Summary of Doctoral thesis: The impact of foreign investment on economic security in Vietnam

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INTRODUCTION
1. Rationale for the study
In   1987,   the   National   Assembly   promulgated   the   Law   on 
Foreign Investment in Vietnam, effective from January 1, 1988. Over 
the  past  30  years,  attracting  and  using FI  in  Vietnam,  on  the  one 
hand,   FI   has   made   important   contributions   to   the   socio­economic 
development,   contributing   to   the   improvement   of   the   market 
economy   institution,   improving   business   investment   environment, 
developing foreign relations, co­operation, international integration, 
ensuring national security and enhancing our country's reputation and 
position in the international arena. The reality of the past 30 years 
also shows that FI has always played a role as one of the important 
components,   a   driving   force   in   the   development   of   the   economy 
towards industrialization and modernization. With US $ 184 billion 
out of a total of US $ 334 billion disbursed in 30 years, FI has added 
an   important   capital   source   to   the   total   social   investment   capital 
contributing to the formation of some key industries of the economy 
such as oil and gas, telecommunications, electricity, electronics ...; FI 
contributes to the development of many high quality services such as 
finance ­ banking, insurance, auditing, legal consultancy, shipping, 
logistics,   education   ­   training,   health,   tourism   ...;   transferring 
agricultural   structure,   improving   the   value   of   export   agricultural 
products, expanding export markets, promoting the transformation of 
export commodity structure and gradually bringing Vietnam to join 
production networks and global value chains. On the other hand, FI 
in   Vietnam   has   also   caused   certain   adverse   impacts   on   socio­
economy in general and economic security in particular. First of all, 
the   spreading   effect   of   the   linkage   between   the   foreign   invested 
sector and the domestic sector is still limited, the productivity is not 
high and there are signs of encroachment. Technology transfer has 

not   achieved   the   expected   results.   The   investment   proportion   of 
transnational corporations (TNCs) is still low; Investments from the 
United States and the EU into Vietnam are not commensurate with 
the   potential.   Some   foreign   investment   projects  have   not   strictly 
complied with the provisions of the law on environmental protection. 
There is still a situation where foreign­invested enterprises use old 


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generation machines and equipment which are not suitable and cause 
environmental pollution. In particular, there have been a number of 
projects   causing   serious   environmental   pollution.   Some   foreign­
invested enterprises violate the law, declaring false losses and true 
profits,   seeking   ways   to   transfer   prices   regularly   and   very 
sophisticatedly   to   avoid   taxes,   causing   great   losses   to   the   state 
budget. In fact, many Vietnamese enterprises have to withdraw from 
joint   ventures,   enterprises   to   become   100%   foreign   capital.   The 
dispute   of   labour   contracts,   benefits   leading   to   the   situation   that 
strikes in foreign invested enterprises tend to increase, causing social 
instability ... In some cases, the attraction of foreign investors has not 
been  fully  calculated,   all   elements   related  to  national   defense   and 
security have not been thoroughly considered.
In   the   open   trend   of   integration,   attracting   foreign 
investment,   the   special   attention   of   the   countries   to   the   economic 
benefits and national economic security makes the issue of economic 
security become an important factor, having an important impact not 
only   on   the   NS   but   also   on   regional   and   international   security. 
Meanwhile,   the   awareness   about   the   threats   of   national   economic 
security due to the impact of foreign investment in Vietnam is still 
inadequate and has not kept up with the rapid development of the 

situation,   especially   the  issues   of   Finance   Security,   Food   Security 
and Energy Security. We still have gaps in the strategy of attracting 
and   using   foreign   investment   in   state   management   and   national 
security ensure in general and economic security in particular.
Theories   and   practices   of   the   impact   of   FI   on   countries 
receiving investment in many fields, especially economic security, 
have  attracted  the   research  interest   of   many   scientists   in   different 
angles, different areas and achieved certain results. However, until 
now,   there   has   not   been   any   research   project   that   fully   and 
systematically   studies   the   impact   of   FI   on   economic   security   in 
Vietnam from the perspective of political and economic science, the 
requirement is to continue to clarify the theory and practice of the 
above issue, thereby propose points of view and solutions to promote 
positive impacts, limit negative impacts of FI on economic security 
in Vietnam. In that sense, the author chooses the topic "The impact of 


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foreign   investment   on   economic   security   in   Vietnam"   as   his 
economics doctoral thesis, majoring in political economy.
2. Purposes and tasks of the thesis
* Purposes: 
Clarifying practical and theoretical basis of the impact of 
FI on ES in Vietnam by assessing the current situation, proposing 
viewpoints and solutions to promoting positive effects and limiting 
the negative ones of FI on ES in Vietnam in the time to come.
* Tasks:
Giving an overview of research situation related to the thesis.
Building theoretical foundations about the impact of FI on ES; 
indicating the concepts, contents of the impact of FI on ES in Vietnam.

Investigating, assessing the current situation of negative and positive 
effects of FI on ES, pointing the causes and issues need dealing with from the 
current situation of impact of FI on ES in Vietnam.
Proposing viewpoints and solutions to promoting positive effects and 
limiting the negative ones of FI on ES in Vietnam in the time to come.
3. Object and scope of the thesis
* Object of the thesis: The impact of FI on ES.
* Scope of the thesis:
In terms of content: The study focuses on the impacts of FI 
on ES including financial security, food security and energy security.
In terms of space: In the territory of Vietnam.
In terms of time: Data obtained from 2011 to 2018.
4. Theoretical, practical basis and methodology
* Theoretical basis: The thesis is based on the viewpoint of 
Marxism­Leninism,   Ho   Chi   Minh's   thoughts   on   capitalist   export, 
foreign economic development and ES in the market economy with 
the state management.
*   Practical   basis:  The   thesis   is   conducted   by   making 
surveys,   analysing,   assessing   and   sintering   the   actual   situation   of 
different cities and provinces in the country dealing with the impact of 
FI   on   ES   in   recent   years;   consulting   the   data   and   findings   of   the 
foreign and domestic researches published previously; reports of the 
Government,   instructions   and   directives   of   different   branches, 
Ministries and People’s Committees in the country related to the study.


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* Methodology:  The thesis uses the methodology of dialectical 
materialism   and   historical   materialism,   combined   with   the   use   of 
methods of analysis and synthesis; history and logic; generalization 

and   abstraction;   sociological   investigation   methods   to   fulfil   the 
purposes and tasks of the dissertation.
5. New contributions of the thesis 
The thesis builds up its own concept and interprets different 
contents and influential factors of FI on ES in Vietnam.
The analyses and assesses the current situation of positive and 
negative impact of FI on ES in Vietnam in the 2011 ­ 2018 period, 
identifying the causes and five urgent issues need addressing regarding 
to the impact of FI on ES in Vietnam.
Base on the practical and theoretical basis, the causes and 
rising issues, the study proposes four viewpoints and five solutions to 
promoting the positive effects and limiting negative ones of FI on ES 
in Vietnam in the time to come.
6. Theoretical and practical significance of the thesis 
The   thesis   contributes   to   clarify  some   practical   and 
theoretical basis about the impact of FI on ES in Vietnam. The findings 
of the thesis serve as practical and theoretical basis for references for 
different departments in giving directions to attract FI and ensure ES in 
Vietnam   today.  The   dissertation   it   can   be   used   as   references 
researching and teaching related to the impact of FI on ES in Vietnam.
7. Structure of the thesis 
The   thesis   includes:   Introduction,   4   chapters   (9   periods), 
Conclusions,   list   of   scientific   works   of   the   author   related   to   the 
dissertation, list of references and Appendices.
Chapter 1
OVERVIEW OF THE THESIS­RELATED RESEARCH 
SITUATION
1.1. The foreign works related to the thesis
1.1.1. The works on security and economic security
“The   link   between   economics,   stability   and   security   in   a  

transforming economy” by Katarzyna Zukrowska (1999); Report of a 


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workshop   organized   by   the   Institute   of   Defence   and  Strategic 
Studies   (IDSS)  (2003),  “Globalization   and   Economic   Security   in  
East Asia ­ Governance and Institutions;  “Economic security in an  
era of globalization: definition and provision” by Miles Kahler (2004); 
“Some   Opinions   on   the   Relation   between  Security   Economy   and  
Economic Security”  by Valeriu Ioan ­ Franc (2010);  “Globalization, 
security, and economic well­being” by Stephen M.Carmel (2013).
1.1.2. The works on international trade, foreign investment  
and impacts of security on foreign investment
“Analysing the impact of foreign direct investment on the  
development of domestic firms” by Salvador Barrios, Holger Gorg, 
Eric Albert Strobl (2004);  “Foreign direct investment in Africa: The  
role of natural resources, market size, government policy, intuitions and  
political   instability”  by   Asiedu   (2006);  “The   Interplay   between  
Foreign Direct Investment, Security and European Integration: The  
Case of the Central and Eastern European Countries”  by  Carmen 
Raluca Stoian  &  Roger Vickerman (2005);  “The  Impact of Inward  
FDI   on   Host   Countries:   Why   Such   Different   Answers”  by  Robert 
E.Lipsey and Fredrik Sjoholm (2006); “Foreign Direct Investment in 
Developing Countries: Impact on Distribution and Employment”  by 
Faramarz   AKARAM   (2008);  “FDI   and   Economic   Growth   in  
Malaysia”  by   Mohammad   Sharif   Karimi   and   Zulkornain   Yusop 
(March   2009);  “Non­equity   Modes   Of   International   Production   And  
Development”  by  World   Investment   Report   (2011);  “International 
Trade,   Foreign  Direct   Investment,   and  Security”  by  Avinash  Dixit 
(2011); The Impact of National Security on Foreign Direct Investment  

in   Nigeria:   An   Empirical   Analysis”  by  Dickson   Oriakhi   Presley 
Osemwengie   (2012);  Foreign Investment, the National Interest and  
National Security ­ Foreign Direct Investment in Australia and China” 
by   Viviane   Bath   (March   2012);  “Why   Do   Companies   Invest  
Overseas?” by John Dunning (2014).
1.2. The domestic works related to the thesis
1.2.1. The works on foreign investment
“Foreign direct investment in the key economic areas in the  
South   ­   issues   for   security   work”  by   Đinh   Văn   Hồng   (2002); 
“Foreign direct investment with industrialization and modernization  
in   Vietnam”  by   Nguyễn   Trọng   Xuân   (2002);  “Foreign   direct  


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investment in Vietnam ­ Current situation and solutions” by Trần 
Xuân   Tùng   (2005);  “Socio­economic   issues   arising   in   foreign  
direct investment: Chinese experience and reality in Vietnam”   by 
Đỗ Đức Bình, Nguyễn Thường Lạng (2006),  Nguyễn Thị Tuệ Anh 
(2006); “The impacts of foreign direct investment on economic growth  
in  Vietnam”  by  Nguyễn  Thị   Tuệ   Anh   (2006);  “Strikes   in   foreign  
invested companies ­ Issues for the work of security and order” by 
Nguyễn   Mạnh   Thắng   (2008);  “Foreign   direct   investment   in   the  
direction of sustainable development in the key economic areas in  
the north”  by  Trần Tuyết Lan  (2014);  “Impacts of foreign  direct 
and indirect investment on ASEAN economics” by Nguyễn Trung 
Thông (2016); “30  years of attracting foreign investment in Vietnam, 
insight and new opportunity in the new era” by Ministry of Planning 
and Investment (2018).
1.2.2.  The works  on economic  security,  national  security  
protection

“Strengthening the State management on national security in  
our country today” by Trần Đại Quang (1996);“Reality and solutions 
for economic security protection in FDI in Hung Yen province” by Bùi 
Mậu Quân  (2001 ­ 2002);  “Violation of national security in FDI ­  
current   situation   and   solutions   of   Institutions   of   Security”  by   Bùi 
Trung Thành (2001);  “Economic security protection in the current period  
in our country today ­ theoretical and practical issues” by Bùi Trung Thành 
(2002);   “Security in foreign investment in Ho Chi Minh city and some  
Southern provinces”  by  Trần Kim Ngọc (2003) and  “Nguyễn Xuân 
Thắng  (2006);  “Different   levels   of   development   and   economic  
security   in  ASEAN”  by  Nguyễn   Văn   Dũng   (2007);“FDI   in   the  
border provinces in the North ­ Rising issues for ensuring security  
and order” by Nguyễn Thường Lạng (2008); “Security in foreign  
investment   in   Vietnam   in   the   international   integration   era”   by 
Nguyễn Xuân Yêm (2008); “economic security in the integration era 
and WTO” by  Nguyễn Hồng Hải (2010);  “The work of protecting  
economic security for Vietnam’s import­export with America” by Đỗ 
Ngọc   Quang   (2011);   “Some   challenges   for   national   security   in  the  
international   integration   era”  by    Nguyễn   Thị   Kim   Hồng   and 
Nguyễn Thị Bé Ba (2011);“Food security in the Mekong Delta River”  
by Phạm Ngọc Hiền, Nguyễn Văn Lan;  “International economic  
integration   ­   rising  issues   for   the   Police   work”  by  Nguyễn  Văn 


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Việt, Lê Thị Quỳnh (2011);  “Ensuring environment security for the  
country’s   sustainable   development   in   the   new   situation”  by  Trần 
Minh   Tơn   (2014);  “Ensuring   security   for   the   industrial   areas   in  
Hanoi   city”  by  Lê   Minh   Thảo   (2014);  “The   work   of   ensuring  
argicultural economic security ­ practical and theoretical issues” by 

Nguyễn Ngọc Thế (2014); “Monetary financial security in Vietnam  
in the changes of the world financial market”  by  Nguyễn Thị  Mùi 
(2015);  “Non­traditional   security   in   the   international   integration  
time”  by   Tô   Lâm,   Nguyễn   Xuân   Yêm   (2017);  “Non­traditional 
security ­ practical and theoretical issues” by Tạ Ngọc Tấn, Phạm 
Thành Dung, Đoàn Minh Huấn (2018).
1.2.3. The works on the impacts of foreign investment
 “Foreign sponsor and investment in Tay Nguyen and their rising  
issues on security” by Trần Xuân Dung (2006), “Rising socio­economic  
issues   in   foreign   direct   investment   of   some   Asian   countries   and  
solutions   for   Vietnam”  by  Trần   Quang  Thắng   (2012),  “Anti­prize 
transforming and some financial issues related to FDI” by Vũ Đình 
Ánh (2012),  “Negative impacts of FDI and some rising issues for  
economic security in our country today” by Phạm Văn Thừa (2013), 
“Global   financial   crisis:   the   world   and   Vietnam’s   response”  by 
Nguyễn Thị Thu Hoài (2014).
1.3. Overview of the findings of the published scientific 
works and issues need addressing in the thesis
1.3.1. Overview of the findings of the published scientific  
works related to the thesis
The   above   mentioned   works   show   that   the   foreign   and 
domestic authors have touched upon a variety of aspects of FI, ES 
and impacts of FI on ES.
Firstly:  These   works   present   the   concepts   and   categories   of 
economy   and   ES.   However,   the   concepts,   categories,   relations   and 
impacts of ES are only in general in the region and in the world. Security 
and ES in the global world and its impacts should be specialized in each 
aspect and each country. These works help this thesis’s author better 
understand the names and relations between economy and ES.
Secondly: Some works touch upon impacts of ES on attracting 

FI   and   the   role   of   the   Government   in   maintaining   the   security 


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stability to promoting FI. However, these works only show the policy 
to   attract   investment   or   compare   interests;   only   few   works 
specifically mention the negative effects of FI on ES.  
Thirdly, these works point out rising issues in FDI in terms of 
human resources, economy and society. Some present the fact that 
FDI in the north and some key provinces in the South contributes to 
the sustainable development and security insurance. However, there 
have been no works touching upon the impacts of FI on ES.
Fourthly:  Some   works   give   an   analysis   on   security   in 
integration   and   FI   and   point   out   impacts   of   FI   in   Vietnam   and 
challenges   of   national   security   in   the   integration   process.   These 
authors   also   propose   solutions   to   ensuring   ES   in   socio­economic 
development. Some works state the reality; solutions to the protection 
of   ES  in  FDI   and  the  cities   and  provinces’   industrial   areas,   other 
works mention the sabotage of ES made by the hostile forces in the 
name   of   FDI.   Some   works   add,   complete   the   theory   of   security, 
security   protection   and   give   advisory   for   leaders   to   manage   the 
investment activity. Some other works analyse systems of specialized 
theory on ES protection and propose solutions to promoting the task 
of ensuring ES of the police in terms of FI. The point that interests 
this thesis’s writer is the negative and positive effects of FI on ES in 
different regions in the whole country. Therefore, both negative and 
positive factors of FI affecting ES should be taken into consideration. 
Fifthly, these works touch upon negative impacts of FDI on 
socio­economic   problems   and   ES.   These   impacts   are   shown   in   the 
security sabotage by investment and sponsorship.

So far, there have no works thoroughly and systematically 
researching on negative and positive effects of FI on ES in Vietnam. 
Thus,   “Impacts   of   FI   on   ES   in   Vietnam”   needs   systematically 
researching both theory and practice and specialized knowledge of 
ES   in   the  integration   period   to   promote  positive   effects   and   limit 
negative effects of FI on ES in Vietnam in the time to come.
1.3.2. Issues need further addressing in the thesis
From the above overview of the published works overseas 
and in the country, the thesis’s author finds out some scientific gaps in 
the impacts of FI on ES in Vietnam. Firstly, what are FI and ES? What 


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is  the conception  of  FI  on ES  in Vietnam?  What  are  its  contents? 
Secondly, the reality of negative and positive effects of FI on ES in 
Vietnam? The causes and issues need dealing with in the coming time? 
Thirdly, which solutions and views should be conducted to promote 
positive effects and limit negative ones of Fi on ES in Vietnam?
In order to answer the above questions, the thesis interprets and 
clarifies the following issues: Firstly, building the theoretical frame on FI, 
ES and impacts of FI on ES in Vietnam; Secondly, making surveys and 
assessing objectively the current situation of  impacts of FI on ES in 
Vietnam, indicating the causes and issues need addressing in the coming 
time;  Thirdly,   proposing   systems   of   views   and   solutions   to   promote 
positive effects and limit negative effects of FI on ES in Vietnam in the 
time to come.
Summary of Chapter 1
Chapter 1 gives an overview of 16 works by foreign authors; 
33   works   by   domestic   researchers   in   such   different   types   as 
textbooks,   doctoral   dissertation   and   articles.   Accordingly,   this 

thesis’s   author   generalizes   achievements   and   shortcomings   of   the 
above works and points out issues need dealing with in this study.
Chapter 2
THEORETICAL BACKGROUND TO THE IMPACT OF 
FOREIGN INVESTMENT ON ECONOMIC SECURITY IN 
VIET NAM 
2.1. Overview of foreign investment and economic security 
2.1.1. Conception, forms and roles of foreign investment 
2.1.1.1. Conception of foreign investment
With the 2014 Investment Law, there are a lot of new points about 
FI in Vietnam. Under this law, the forms of investment in Vietnam are 
generally applied to investors (under Section 13, Article 3 of the 2014 
Investment Law, “Investors are organizations and individuals performing 
the activities of business investment, including domestic investors, foreign 
investors and foreign­invested economic organizations”.
2.1.1.2. Forms of investment: The 2014 Investment Law clearly 
stipulates investment forms in Vietnam. Accordingly, there are 4 forms 
of   investment   as   follows:   Investment   in   establishing   economic 


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organizations; investment in the form of capital contribution, purchase of 
shares or capital contributions to economic organizations; investment 
contracts   in   the   form   of   public­private   partnerships   (PPP   contracts); 
business cooperation contract (BCC contract).
2.1.1.3. Roles of foreign investment 
1)  Add an important  source of  capital  to  the  development 
investment in the country, solving difficulties in internal capital for 
investment countries; 2) Contribute to changing the structure of the 
economy towards industrial development and potential exploitation; 

3)   Promote  the  transformation  of   technology,   technique,   advanced 
and modern management  methods directly and quickly,  creating a 
premise   for   technological   innovation   and   promoting   domestic 
capacity and development goals; 4) Create conditions for countries 
receiving   investment   to   access   to   the   world   market,   explore   and 
promote the advantages of their own and times’, help participate and 
compete internationally; 5) Create more jobs for domestic workers on 
the basis of developing new industries or general services; 6) Help 
countries   receiving   investment   participate   in   various   international 
and regional forums, creating advantages of bilateral and multilateral 
relations both economically and politically, step by step improving 
position in the international arena.
2.1.2. Economic security
2.1.2.1. Conception of Economic Security 
From the above analytical study, the author argues that: ES is a  
part of national security, the state of an economic with a stable  
development, with little or no risk of threats to the nation's core  
economic interests, able to effectively prevent and deal with the  
effects   of   domestic   and   international   factors;   ES   includes  
finance security, energy security and food security.
National ES is the state of a stable development economy ­ a 
self­control economy having ability to compete internationally in the 
key manufacturing industries. The economy has little or no risk of 
threatening the nation's core economic interests; the economy has the 
ability to effectively prevent and deal with the effects of domestic 
and international factors.
The contents of ES include: finance security, energy security and 


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food security. It is a reflection of the nation's core interests, the basis of 
other security relations in a country
2.1.2.2. Components of Economic Security
* Finance security is the category indicating a stable, safe,  
strong, non­crisis financial status, being able to effectively prevent  
inside   and   outside   negative   impacts   in   the   process   of   developing  
market economy and international economic integration.
* Food security: In 1996, FAO defined food security, which 
the author agrees very well: Food security exists when everyone, at  
all times, can access to the society both materially and economically  
to food in a full, safe and nutritious manner, meeting the people’s  
eating needs and preferences for an active and healthy life.
*  Energy   security:  The   conception   of   energy   security   has 
undergone many different debates  and approaches,  but  the  current 
notions   in   Vietnam   are   relatively   unified,   the   author's   thesis   also 
agrees that: Energy security is a guarantee of enough energy in many  
different forms, clean and reasonably priced.
2.2. Conception, and contents of the impact of foreign 
investment on economic security in Vietnam 
2.2.1. Conception of the impact of foreign investment on  
economic security in Vietnam 
From the analysis of some arguments, the author gives the notion: 
The impact of foreign investment on economic security in Vietnam is the  
activity of foreign investment with the participation of the entities creating  
positive and negative changes affecting elements of economic security such  
as finance security, food security, and energy security in the process of  
developing a socialist­oriented market economy.
The conception clearly points out the following issues:
In reality, the impact of FI on economic security is reflected 
in a number of issues such as: Firstly, FI with its subject is a large, 

transnational group; FI has become a decision­maker at the backstage 
of   the   process   of   forming   foreign   policy   of   a   sovereign   state. 
Secondly,   the   core   of   the   foreign   investors'   concern   is   only   the 
difference in the rate of return compared to the factors and resources 
of different countries and regions for working capital.  Thirdly,  the 
promotion of foreign investment on a large scale has a great impact 


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on host countries in both positive and negative aspects.
2.2.2.   Contents   of   the   impact   of   foreign   investment   on  
economic security in Vietnam 
2.2.2.1. Impacts of foreign investment on finance security in Vietnam 
* Positive impacts of foreign investment on finance security 
Firstly,   developing   and   stabilizing   domestic   finance   security; 
secondly, increasing the total indirect investment of society; thirdly, positively 
affecting the development of the financial market in particular, the completion 
of the institutions and market mechanisms in general.  Fourthly, enhancing 
opportunities and diversifying investment methods, improving the quality of 
human resources and income of many people. Fifthly, the impact as a boost to 
improve the capacity and efficiency of the state management according to the 
principles and requirements of market economy and international integration.
* Negative impacts of foreign investment on finance security
Firstly,  multinational companies (TNCs) can intervene and 
manipulate the market economy, affecting financial autonomy.
Secondly, the proportion of foreign investment is too large, 
overwhelming domestic investment; currency speculation activities, 
sudden capital withdrawal leading to a market dependent economy.
Thirdly,   foreign   investment   is   very   limited   in   transferring 
new technologies that are highly competitive.

Fourthly, creating inflation impetus in the economy.
Fifthly,  increasing   the   level   of   sensitivity   and   economic 
instability related to foreign factors.
Sixthly, increasing the risk of acquiring, merging, controlling 
and manipulating finance for enterprises and securities issuers.
Seventhly,   increasing   the   scale,   nature   and   urgency   of 
fighting international economic crimes
2.2.2.2. Impacts of foreign investment on food security in Vietnam 
* Positive impacts of FI on food security in Vietnam  
Firstly, foreign investment contributes to the supplement of  
capital for agricultural development investment.
Secondly,   increasing   the   opportunity   to   participate   in   the  
world agricultural supply chain.
Thirdly:   Foreign  investment   creates   agricultural   economic  
restructuring   towards   modernization   and   diversification   of  


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agricultural products to introduce to the market.
Fourth: Foreign investment improves the quality of human  
resources and creates jobs in the agricultural and rural economy.
* Negative impacts of FI on food security in Vietnam 
Firstly,   there   are   not   many   foreign   investment   projects   in 
agriculture,   the   capital   is   low   and   they   are   unevenly   distributed   in  
different fields affecting food supply.
Secondly, altering the structure of resources that are detrimental  
to food security.
Thirdly, increasing competitive pressure on the domestic market.
Fourthly, the strong impact of "technical barriers" on businesses  
and farmers ­ the supply of food security.

Fifthly, causing insecurity to the business environment and the  
living environment of the population in the area of investment.
2.2.2.3. Impacts of foreign investment on energy security  
in Vietnam 
*   Positive   impacts   of   foreign   investment   on   energy  
security in Vietnam 
Firstly,   affecting   energy   prices,   power   supply   and   energy  
policy improvement in Vietnam.
Secondly,   shifting   the   agricultural   economy   using   energy  
mainly based on traditional biomass fuels to the industrial economy  
using synthetic and modern forms of energy.
* Negative impact of FI on energy security in Vietnam 
Firstly, many risks in the national electricity supply.
Secondly, adverse impacts on energy resource management  
and energy price mechanism.
Summary of chapter 2
In chapter 2, the author has developed a theoretical framework. 
This is an important basis for the researcher to continue studying the 
current   situation   of   attracting   foreign   investment   and   the   impact   of 
foreign investment on economic security, thereby proposing the views 
and solutions to promote the positive impacts and limit the negative 
impacts of foreign investment on economic security in the coming time
Chapter 3
CURRENT SITUATION OF THE IMPACT OF FOREIGN 


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INVESTMENT ON ECONOMIC SECURITY IN VIET NAM 
3.1. Overview on foreign investment in Vietnam over the past time 
The   thesis   has   summed   up   the   results   of   the   situation   of 

attracting foreign investment up to 2018: After more than 30 years of 
"welcoming" FDI, from 1988 to August 2018, 63 provinces and cities of 
the country attracted 26,438 FDI projects of 129 countries and territories 
which are still valid with a total registered capital of US $ 333.83 billion 
and realized capital is estimated at US $ 183.62 billion, equal to 55% of 
the total valid registered capital disbursed in 30 years, FI has added an 
important capital source to the total social investment capital.
Through   the   overview   of   foreign   investment   in   Vietnam 
over the past time, the researcher has come to assert that: In some 
cases,   the   attraction   of   foreign   investment   has   not   been   fully 
calculated, attracting investment by all means, leading to the risk of 
imbalance, threatening the economic security such as: (i) the growth 
rate is still low, the quality of growth is not really sustainable; (ii)  
There  was   mainly   a  deficit   in   the   trade  balance   in   the   period  of 
2001­2017; (iii) The state budget deficit tends to increase due to  
low   efficiency   in   production   and   investment.   This   is   one   of   the  
factors that threaten the sustainability of economic security in the 
current period.
3.2.   Current   situation  of   positive  and  negative   impacts   of 
foreign investment on economic security in Vietnam 
3.2.1. Impacts of foreign investment on finance security 
* Positive impacts of foreign investment on finance security 
Firstly,   foreign   investment   replenishes   capital,   increases  
state budget revenue through taxes.
Based on an overview of the attraction of foreign investment 
over  the past  30 years,  up  to  August  2018,  there  were  more  than 
26,500   FDI   projects   with   the   registered   capital   of   more   than   334 
billion USD, the realized capital of about 184 billion USD. Foreign 
investors have contributed nearly 20% of GDP and are an important 
additional source of capital for investment and development with a 

proportion of about 23.7% of the total social investment capital. The 
Ministry   of   Planning   and   Investment   also   said   that   FI   plays   an 
important   role   in   boosting   the   economic   growth   of   Vietnam,   the 


15
contribution of the foreign investment sector in the country's GDP 
increased from 9.3 % in 1995 to 19.6% in 2017.
Secondly,   FI   affected   Finance   Security   in   the   national  
financial market.
  FI   is   fully   qualified   to   participate   in   developing   the 
financial   market,   including   the   stock   market.   In   2016,   the   stock 
market   capitalization   reached   about   VND   2.53   million   billion 
(reaching 56% of GDP in 2016), increasing 30% compared to the 
end of 2016; for the bond market, outstanding loans are equivalent 
to about 30.09% of GDP. In 2017, FII capital through investment  
activities  to contribute capital,  bought  shares of foreign investors 
amounted to 6.2 billion USD (up 45.1% compared to 2016). This 
means   that   nearly   140,000   billion   dong   of   FII   capital   has   been 
poured into Vietnam by foreign investors. FII inflows into Vietnam 
is a good signal for both the economy, the stock market, insurance 
and   arrangement,   innovation   and   equalization   of   state­owned 
enterprises to continue to be synchronized.
* Negative impacts of foreign investment on finance security 
Firstly,   foreign   investment   intervenes,   manipulates   the 
market economy, destabilizing the national finance.
Fraudulent activities, money laundering activities, funding 
activities for illegal businesses and terrorist activities together with 
different types of crimes and other non­traditional security threats. 
The resonance of criminal activities and the negative effects of the 

above capital flows, especially when they occur in an "organized" 
way of speculators or international political hostile forces, they will 
harm healthy economic activity much or less; even in some cases,  
they discredit the state, influence and indirectly interfere in politics, 
making the government cabinet to collapse.
Secondly, too much foreign investment  will dominate and decide 
domestic production activities.
Monetary speculation and sudden capital withdrawal led to the 
market economy being easily dependent on the outside. The increase in 
the percentage of  holding  shares  of  investment   in  manufacturing  and 
financial   markets,   especially   establishment   stocks   and   shares   up   to   a 
certain level of "surpassing" will allow them to directly dominate and 


16
decide production activities.
Thirdly,  FI   in   Vietnam   is   often   old,   backward,   causing 
environmental pollution and less transformation of new technologies.
According to Deputy Minister  of  Planning and Investment 
Dao Quang Thu, statistics show that over 80% of FDI enterprises use 
the world's average technology, 5­6% use high technology, 14% is 
low and backward. Many cases of foreign investors take advantage of 
the loopholes of law to import outdate machinery and equipment into 
Vietnam, increase import value and value of technology transfer.
Fourthly,   FI   has   caused   psychological   instability   for 
domestic investors. 
Fifthly,   FI   has   made   the   domestic   stock   market   develop 
unsustainably.
Sixthly,   economic   crimes   with   foreign   factors   have   been 
increasing and more and more sophisticated and complicated.

3.2.2. Impacts of FI on food security 
* Positive impacts of FI on food security 
Firstly, FI helps to accelerate capital flows in the world,  
especially   FDI   inflows   into   Vietnam,   thereby   increasing   capital  
investment in agriculture.
According to the Foreign Investment Agency (Ministry of 
Planning and Investment), as of February 2018, total foreign direct 
investment   (FDI)   in   agriculture   was   USD   350   million   with   514 
projects.   If   compared   with   the   accumulated   investment   in   the 
Agriculture   sector,   this   capital   only   accounts   for   about   1%.   This 
capital is mainly from Japan.
Secondly,   FI   initially   contributes   to   the   restructuring   of  
agricultural   economy   towards   modernization   and   diversification   of  
agricultural products.
FDI projects have implemented the policy of agricultural and 
forestry restructuring, product diversification. Up to now, there have been 
more than 50 countries and territories investing in the field of agriculture, 
forestry and fisheries of our country. The leading countries are: Korea, 
Japan, Taiwan, Hong Kong, Malaysia. Japan is a major investor in this 
field, so far, there have been projects successfully implemented in the 
application of Japanese science and technology to Vietnam.


17
Thirdly, meeting the demand for food and foodstuff in the country 
Agriculture in our country has basically met the demand for 
domestic   food   and   foodstuff,   ensuring   food   security,   has   formed 
relatively large agricultural commodity production areas, the rate of 
goods increased rapidly.
Fourthly, increasing the export value of Vietnamese agricultural products.

  Total   export   turnover   in   10   years   (2008­2017)   reached 
261.28 billion USD, an average increase of 9.24% / year; In 2017 
alone, it was 36.52 billion USD, increased by 20.05 billion compared 
to 2008 and was expected to reach 40 billion USD in 2018. Vietnam's 
agricultural   products   have   been   present   in   180   countries   and 
territories. Vietnam's agricultural exports ranked the 2nd in Southeast 
Asia and the 16th in the world.
Fourthly,   contributing   to   training   high   quality   staff   and 
creating jobs for agricultural workers.
According to the statistics of the General Statistics Office, as 
of July 1, 2008, labourers working in the foreign­invested economic 
sector accounted for a total of 1831.4 thousand labourers, of which 
the agricultural sector accounted for about 8.2% of employees
* Negative impacts of foreign investment on food security 
Firstly, it has not attracted big investors into agriculture, it  
was unevenly distributed.
FI projects in agriculture mainly come from investors in Asia 
with high technology that have not really been developed such as Thailand, 
Taiwan, Indonesia ... There are not many investors from countries with high 
level of development in agriculture such as the US, Japan, EU ... 
Secondly,   changing   jobs   and   income   of   workers,   creating  
instability for sustainable development in agriculture.
The quality of life of food production people is not improved 
and vulnerable. Currently, labourers living in rural areas account for 
about 70% of the total labour force. Therefore, the lack of careful 
calculation of foreign investment in the agricultural sector may affect 
the employment of most rural workers.
Thirdly, low agricultural labour productivity increases the  
competitive pressure on the domestic market.
Fourthly,   competitive   pressure,   quality   assurance   of  

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domestic agricultural producers in the international market. 
Fifthly,   agricultural   land   is   narrowed   and   habitat   is  
destroyed.
3.2.3. Impacts of foreign investment on energy security 
* Positive impacts of foreign investment on energy security 
Firstly,   increasing   foreign   investment   in   clean   energy,  
renewable   energy,   boosting   high­tech   usage,   low   energy  
consumption,   and   improving   the   environment   to   ensure   national  
energy security.
So far, 9 countries have invested in green energy FDI projects 
including Korea, Germany, France, India, the United States, Singapore, 
Russia, Belgium and China. Of these countries, the first is Korean with a 
total registered investment capital of over US $ 371 million, accounting 
for 48%; Germany ranked the second with a total registered investment 
capital   of   226.68   million   USD,   accounting   for   29.3%   of   the   total 
registered investment capital in the green energy sector. Followed by 
French, Indian and US investors with total registered capital of 77.12 
million USD; 59.22 million and 26 million USD respectively. 
Secondly, FI affects the reasonable energy price mechanism  
and the development of energy infrastructure in Vietnam
* Negative impacts of foreign investment on energy security
Firstly, the national electricity supply is not sustainable
FI projects on electricity gas are often behind the schedule 
(gas source Block B, Blue Whale gas source and new power source 
projects), leading to a shortage of electricity from 7.2 to 7.5 billion 
kWh / year. The power sources which have been started to be put into 
operation   in   the   coming   time   are   very   low   compared   to   the 

requirements, currently only 7 coal thermal projects with 7,860 MW 
have been started and are under construction.
Secondly, energy management and energy price mechanism  
are very precarious and unstable.
Vietnam has attracted 16 FDI projects in the green energy 
sector. Countries investing in green energy projects are all developed 
and   emerging   economies   such   as   Korea,   Germany,   France,   the 
United   States,   Belgium   and   Singapore,   India,   Russia   and   China. 


19
However, the number of FDI projects in the green energy sector is 
not commensurate with the potential and strength of Vietnam.
3.3. Causes of the situation and the issues that need to be addressed 
in the impact of foreign investment on economic security in Vietnam 
3.3.1. Causes of positive impacts of foreign investment on  
economic security in Vietnam 
Firstly,   the   objective   trend   of   international   economic  
integration   increases   foreign   investment   and   ensures   economic  
benefits and security of nations.
Secondly, the economic and binding cooperation among the  
countries   in   the   development   process   facilitates   the   attraction   of  
foreign investment and the beneficial impact of foreign investment on  
economic development, and economic security.
Thirdly, the product cycle, the transfer and exploitation of  
technology   and   experts   and   the   access   to   natural   resources   are  
encouraging foreign investment promoting positive impacts, ensuring  
investors’ benefits and the investment recipients’ benefits.
Fourthly, the relationship between domestic enterprises and foreign  
enterprises has certain openness ensuring the interests of the parties.

Fifthly,   the   State   guarantees   policies   and   laws   for   foreign  
investment.
          Sixthly, the capacity of domestic enterprises to join the supply  
chain for foreign invested enterprises is gradually affirmed.
Seventhly,   initially   promoting   the   role   of   agencies,  
departments, local authorities and organizations in enterprises in  
foreign investment activities, ensuring Economic Security on the  
impact of foreign investment.
3.3.2. Causes of negative impacts of foreign investment on  
economic security in Vietnam 
Firstly, impact the reverse of globalization
Secondly,   the   world   economy   has   fluctuated   and   caused  
indirect   instability   for   Vietnam's   economy,   FII   directly   affected  


20
Vietnam's financial security.
Thirdly,   global   issues   are   complicated   and   unpredictable,  
leading   to   more   complicated   foreign   investment,   causing   national  
security instability.
Fourthly,   some   of   the   foreign   investors   because   of  
maximizing   profit   and   surplus   value   have   defied   all,   taking  
advantage of foreign investment to against us in economics.
Fifthly,   it   is   the   lack   of   synchronization   of   mechanisms,  
policies, laws and documents regulating foreign investment.
Sixthly, a part of cadres and people are aware of and act on  
laws   and   the   threat   of   national   security   in   foreign   investment  
activities insufficiently.
3.3.3.   Issues   arising   from   the   real   impact   of   foreign  
investment on economic security in Vietnam

Firstly,   the  conflict   between  imbalance   in  attracting  foreign  
investment with dynamism and flexibility in investment promotion and  
foreign investment management.
Secondly, the contradiction between the requirement to improve 
the   efficiency   of   foreign   investment   and   ensure   long­term   economic  
security   with   the   unreasonable   strategy,   high   added   value   and   the  
content of knowledge technology in foreign investment attraction.
Thirdly, the conflict between the need to overcome the negative  
impacts of foreign investment and economic security with the internal  
difficulties of the economy is slowly removed.
Fourthly, the conflict between attracting foreign investment by  
all means with limitations in the strategy of using and managing foreign  
investment effectively. 
Summary of Chapter 3
In   chapter   3,   the   researcher   has   analysed   and   evaluated 
achievements,   limitations   of   foreign   investment   attraction   and 
assessed   the   impact   of   foreign   investment   on   Economic   Security, 
pointed out the causes and problems posed to the impact of foreign 
investment   on   Economic   Security   in   Vietnam   over   the   past   time; 
Along with the research results in chapter 2, the research results in 


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chapter   3   will   be   the   basis   for   the   researcher   to   continue 
implementing the content of chapter 4 of the thesis.
Chapter 4
VIEWPOINTS AND SOLUTIONS TO PROMOTE THE 
POSITIVE IMPACTS, LIMITE THE NEGATIVE IMPACTS 
OF FOREIGN INVESTMENT ON ECONOMIC SECURITY IN 
VIETNAM IN THE COMING TIME

4.1.   The   viewpoint   of   promoting   positive   impacts   and 
limiting   negative   impacts   of   foreign   investment   on   economic 
security in Vietnam in the coming time 
4.1.1.   Consistently   implementing   the   view   that   foreign  
investment is an important part of the economy, economic security  
plays the central role in national security.
Firstly,   the   right   perception   of   foreign   investors   must  
encourage long­term development of foreign investment and create  
the right direction.
Secondly, proper awareness of foreign investment position in  
new conditions must implement foreign investment cooperation with  
more extensive internal functions.
Thirdly, be aware of the position of Economic Security and solve  
the relationship between foreign investment and Economic Security well.
4.1.2. Attracting foreign investment must go hand in hand  
with ensuring national, ethnic benefits and economic security 
Firstly, consistently implementing the viewpoint of ensuring  
national and ethnic interests in attracting foreign investment.
Secondly, properly orientating foreign investment activities,  
ensuring economic security.
4.1.3.   Improving   the   efficiency   of   attracting   foreign  
investment to minimize its negative impacts on socio­economic and  
economic security
Firstly, it is necessary to institutionalize the Party's lines and  
views in this area with legal documents.


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Secondly, it is necessary to actively cooperate with foreign  
investment   in   accordance   with   socio­economic   development  

requirements and national economic security.
Thirdly,   it   is   necessary   to   intensify   monitoring   and  
supervising foreign investment activities to limit its negative impacts  
on social economy and economic security.
4.1.4. Closely combining foreign investment attraction with  
ensuring national defense and security
Firstly, improving the role of participants in combining economy 
with national defense and security in foreign investment activities.
Secondly, improving the role and management capacity of  
the State in combining economy with national defense and security in  
foreign investment activities.
Thirdly, continuing to create a legal basis to meet practical  
requirements   of   combining   economy   with   national   defense   and  
security in foreign investment activities.
Fourthly,   improving   the   effectiveness   of   coordination   of  
participating forces in combining economy with national defense in  
researching and forecasting foreign investment situation.
Fifthly,   it   must   be   conducted   regularly,   synchronously,  
comprehensively and with a focus on activities to combine economy  
with national defense in foreign investment activities.
4.2. Solutions to promote positive impacts, limit negative 
impacts of foreign investment on economic security in Vietnam in 
the coming time
4.2.1. Heightening the role of the State in attracting foreign  
investment with ensuring economic security 
Firstly, maintaining socio­political stability.
Secondly, maintaining macroeconomic  stability, creating a  
favourable environment for foreign investment activities
Thirdly,   improving   the   legal   framework   related  to  foreign  
investment and economic security.

4.2.2. Capital restructuring, investment structured towards  
improving foreign investment efficiency 
Firstly,   restructuring   foreign   investment   capital   in   the  


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direction of having a focus.
Secondly,   implementing   investment   restructuring   of   the  
foreign invested sector.
4.2.3. Ensuring economic security in attracting foreign investment 
Firstly,   it   is   necessary   to   innovate   the   thinking,   the  
awareness of the role, the position in ensuring economic security in  
the strategy of national security protection.
Secondly, it is required to ensure finance security.
Thirdly, it is required to ensure food security.
Fourthly, it is required to ensure energy security.
4.2.4. Improving the quality of human resources to meet  
the requirements in the area of foreign investment 
Firstly, it is to strengthen combining businesses with training  
institutions.
Secondly, it is to strengthen retraining central and local cadres  
on knowledge and capacity to implement foreign investment policies,  
ensuring economic security.
Thirdly, it is to raise the level of human resources to catch high  
quality foreign investment projects.
 4.2.5.   Closely   coordinating   forces   in   managing   foreign  
investment activities and ensuring economic security 
Firstly, it is necessary to comply with the program, plan and  
determine the right coordinative forces.
Secondly, it is necessary to clearly define the content, form of  

coordinative forces.
Thirdly, it is necessary to clearly identify the agency in charge  
of coordinating activities of forces.
Fourthly,   the   Army   and   the   Police   actively   participate   in  
coordinative activities.


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Summary of Chapter 4
From   theoretical   and   practical   research   on   the   impact   of 
foreign investment on economic security, on the basis of assessing 
the impact of foreign investment on economic security in Vietnam 
over the past time, the fourth chapter of the thesis has studied and 
proposed 4 viewpoints and 5 solutions to promote positive impacts 
and   limit   negative   impacts   of   foreign   investment   on   economic 
security in the coming time.
CONCLUSION
1.   Economic   Security   in   attracting   foreign   investment   in 
Vietnam   is   a   very   complex   issue,   it   contains   many   interwoven 
relationships   which   are   diverse   and   at   many   levels,   requiring   clear 
analysis and evaluation methods. This requires a deeper study of the 
impact of foreign investment on economic security as well as the need to 
demonstrate   appropriate   and   effective   long­term   viewpoints   and 
solutions to promote positive impacts and limit negative impacts of FI in 
national security in different stages of national economic development. 
Therefore, studying the topic "foreign investment impact on economic 
security in Vietnam" as a doctoral thesis topic is an important issue both 
on the economic and political level.
2. Foreign investment is a very complex economic activity. It 
is   even   more   complicated   when   capitalists   invest   in   a   socialist 

country.   Therefore,   the   impact   of   foreign   investment   on   economic 
security in Vietnam today needs to focus on many issues implemented 
in   many   stages   and   steps   with   the   participation   of   many   subjects. 
However, under the approach of the political economics department, 
with   the   method   of   scientific   abstraction,   the   thesis   focuses   on 
researching the impact of foreign investment on economic security in 
Vietnam on three main contents: Positive impacts, negative impacts of 
foreign  investment   on Finance Security;   Food Security  and  Energy 
Security. Because these are the core basic contents that when deployed 
and implemented well in the field of attracting foreign investment in 
Vietnam today will have a decisive meaning to the quality, efficiency, 
management of foreign capital for socio­economic development of the 


25
country and ensuring economic security.
3. The impact of foreign investment on economic security in 
Vietnam is influenced by the many objective and subjective factors, 
of which it is mainly due to: Economic developments in the country 
and   in   the   world;   globalization   and   international   economic 
integration;   policies   and   guidelines   of   the   Party,   socio­economic 
development  strategy  of   the  country,   mechanisms  and  policies  for 
attracting   foreign   investment   and   ensuring   economic   security; 
awareness   and   responsibility   of   the   leadership   and   management 
agencies of the Party, the State and the management apparatus in the 
field of attracting and using foreign investment capital and ensuring 
economic security. The precise identification of the impact factors is 
very important in pointing out the causes, achievements, limitations 
and at the same time is one of the bases for setting out the views and 
solutions   to   promote   the   positive   impacts   and   limit   the   negative 

impacts of foreign investment on economic security in Vietnam.
4. In the coming time, attracting foreign investment in multi­
dimensional relationships, intertwining very complexly of the world 
and   foreign   investors   entering   Vietnam   will   give   a   rise   to   a   new 
series of comments such as: Finance Security becomes a focus of 
Economic   Security;   Energy   Security   becomes   an   especially 
important and sensitive issue in Economic Security, even affecting 
the  political   and   military  security;   Food   Security   is   the   basic   and 
long­term issue of Economic Security. From these assessments, the 
thesis offers four views and five solutions to promote the positive 
impacts   and   limit   the   negative   impacts   of   foreign   investment   on 
Economic Security in Vietnam in the coming time.
5.   In   order   to   promote   the   process   of   attracting   foreign 
investment effectively and ensuring Economic Security in Vietnam in 
the   coming   time,   according   to   the   author,   along   with   thorough 
understanding and raising awareness of basic points, it is necessary to 
seriously implement the main solutions that the thesis has mentioned. 
Especially, it is necessary to strengthen the leadership of the Party, 
the   management   of   the   State   and   the   close   coordination   between 
functional   agencies   and   departments   in   attracting,   managing   and 
using foreign investment capital and ensuring economic security. The 
leadership of the Party, the management of the State is a decisive