Dissertation summary: The foreign direct investment of major economic areas in the North of Vietnam

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INTRODUCTION
1. General overview of the thesis
The thesis "The foreign direct investment of major economic areas 
in the North   of Vietnam"  is  a  scientific independent research  which 
contains the author’s desire to study and discover during the years. This 
thesis has been completed under the help of the staff collective guidance 
and consultant economic scientists in and outside the military.
The theisis is based on abreast of the theoretical basis of
Marxism - Leninism and Ho Chi Minh’s ideology, policies and
guidelines of the Communist Party of Vietnam on international
economic relations, foreign investment attraction, as well as is
based on the FDI surveys results of the major economic areas in 
the North   of Vietnam. It has also consulted and inherited the
results of several scientific researches on in the country and
abroad which are involved.
The main contents of the thesis is presented in three
chapters. Chapter 1 presents the theory and experience of
FDI. In chapter 2 author generalize the process of formation,
development and potential and difficulties and challenges of the 
major economic areas in the North  of Vietnam for FDI; and survey
the status of FDI in the  major   economic  areas  in  the   North   of 
Vietnam period 2003 - 2013, show the emerging problems that
are solved in the future.
From the research results in chapter 1, chapter 2, the
author has proposed some perspectives and primarily
solutions to attract FDI in the  major economic  areas  in the North 
of Vietnam in the future (presented in chapter 3). The solution
systems are awareness agreement, thinking innovation;
building and improving the overall projects which have foreign
investment; upgrading economic- social infrastructure,

supporting industry development; human resource training;
raising the effectiveness of state management of FDI.
2. Reasons for choosing thesis topic
In the trend of international economic integration, and
the impact of modern scientific and technological revolution,
movement of resources through investment activities is
unavoidable and play an important role in the development
of the nations, especially the developing countries. The
practice shows that countries, territories attract the more
international capital and use it effectively, the more they


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have chances of economic growth, thereby overcoming
faster the economic backwardness situation compared with
the advanced countries.
In Vietnam, implementation of renovation policies by
Communist Party of Vietnam (1986), especially since the
Foreign Investment Law in effect (1988), foreign investment in
general and FDI in particular is increasingly becoming
popularity and actually become an important goal in the
process of industrialization and modernization of the country.
In the process of development, FDI has gradually affirmed
its position and role in the socialist-oriented market economy
which is reflected in the significant contribution of GDP growth,
investment of the social development, increasing export turnover
and total value of industrial production. The position and role of
this activity is also reflected in the spreading and development of
FDI in most of the provinces, cities, industries and sectors, the
major economic areas throughout the country, including the major

economic areas in the North of Vietnam .
The major economic areas in the North of Vietnam are
included Hanoi (centre), Hai Phong, Quang Ninh, Hai Duong,
Hung Yen, Bac Ninh, Vinh Phuc. This years, FDI in this areas
gained remarkable achievements in quantity, structure and
quality of the project. Thereby, it also adds a significant amount
of capital to invest in developing, exploiting and improving the
efficiency of use of resources in the region, creating a new
position and development force for the economy; promoting
rapidly service activities development; accelerate the process of
economic restructure towards modernization; make the major
economic areas in the North of Vietnam are deeper integration
into the economy of the region and the world.
However, FDI in the major economic areas in the North of
Vietnam in the years has some limitations and and are not
corresponding with the position and potential of the region and the
investment of the central Government. The FDI inflows are
instable, economic growth has been slow in recent years, small
and medium scale mainly; capital structure was unreasonable;
quality of FDI projects is not high because the technology of
production in FDI firms is low compared with other countries in the
region; especially there are the economic - social problems arise
during the operation of the enterprise which formed from FDI.


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These analysis shows that studying and assessing
comprehensively both FDI theories and practice in the major
economic areas in the North of Vietnam and proposing
perspectives and primary solutions to attract FDI inflows in

these region is urgent issues. So the author choose the topic
"The foreign direct investment of the major economic areas in
the North of Vietnam".
3. Research purpose and tasks
* Research purpose:
Clarify some theoretical issues, practices of the foreign
direct investment of the major economic areas in the North of
Vietnam; proposes main requirements and solutions to attract
the foreign direct investment of the major economic areas in
the North of Vietnam in the future.
* The tasks of the thesis:
- Clarify some theoretical issues and make the
experience surveys on FDI.
- Assess the practical situation of the foreign direct
investment of the major economic areas in the North of
Vietnam period from 2003 to 2013.
- Propose the opinions and basic solutions to attract the
foreign direct investment of the major economic areas in the
North of Vietnam in the future.
4. Objects and scope of research
* Objects of research: The theisis studies on the foreign
direct investment of the major economic areas in the North of
Vietnam.
* Scope of research:
- The contents:
+ The thesis focuses on researching issues related to the
attraction of the foreign direct investment of the major
economic areas in the North of Vietnam.
+ The thesis focuses on researching the joint-venture
enterprises and foreign-invested enterprises in the major

economic areas in the North of Vietnam
+ From the perspective of political economy, the thesis
research, propose methodological and oriented solutions.
- Scope of region: The thesis research on FDI in an
economic space delimited by 7 provinces and cities directly
under the Central Government as Bac Ninh, Ha Noi, Hai


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Duong, Hai Phong and Hung Yen, Quang Ninh and Vinh Phuc
in relations with Vietnam's economic space.
- Scope of time:
+ The thesis focuses on the research, assessing the
situation in FDI of the major economic areas in the North of
Vietnam from 2003 to the end of 2013.
+ The views, solutions to attract FDI is proposed in the
thesis focuses primarily to 2020.
5. Theoretical, practical basis and research methods:
* Theoretical basis of the thesis: is a viewpoint system
of Marxism - Leninism and Ho Chi Minh’s ideology; guidelines
and policies of the Party, State, and army on foreign relations
economy and other related theories to approach the object,
comment the research tasks of the topic.
* Practical Data source:
The authors used data from the report's agencies of the
State and the Communist Party of Vietnam, such as the
Central Executive Committee; Foreign Investment Department,
Institute of Development Strategy - Ministry of Planning and
Investment; Committee of coordinating the development of the
major economic areas in the North of Vietnam; GSO, Statistical

Office of the provinces and cities directly under the Central
Government in the major economic areas in the North of
Vietnam; the State management agencies in localities in the
major economic areas in the North of Vietnam; Results were
published in conferences, workshops, surveys, scientific
research projects by organizations and individuals at home
and abroad performing in recent times; the information and
data collected through field surveys of local individuals in the
major economic areas in the North of Vietnam.
* Research Methodology: The thesis uses a system of
methodology of dialectical materialism and historical
materialism, such as: approach to value, system - structure,
analysis and synthesis, logical and historical, abstraction, and
generalization methods. Combine with the methods of
sociological investigation and consultancy with experts, etc.
6. New contributions of the thesis
- Systematize some theoretical issues on FDI, the major
economic areas in the North of Vietnam.


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- Assess the practical situation of FDI in the major
economic areas in the North of Vietnam last time, show the
problems that need to solve.
- Proposal perspectives and solutions to attract FDI in
the major economic areas in the North of Vietnam in the future.
7. Theoretical, practical significances of the thesis
* Theoretical significance: The thesis contributes to
clarify some basic theoretical issues on FDI and the major
economic areas in the North of Vietnam.

* Practical significance:
- Providing the scientific foundation and as the basis for
managers and policy makers to make the right policy to attract
FDI for economic- social development in the major economic
areas in general, in the major economic areas in the North of
Vietnam in particular.
- The thesis can be used as references in political
economy teaching in the academy, military school.
8. Structure of the thesis
Include introduction, overview of research issues, three
chapters (7 periods), conclusions, list of scientific works of the
author related to the thesis, list of references and appendices.


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OVERVIEW OF RESEARCH ISSUES
1.The overseas typical scientific works researching
related the topic
The   work   of   the   Organisation   for   Economic   Co­operation 
and   Development   (OECD):  Foreign  direct   investment   in   China,  
challenges   and   prospects   for   regional   development  [125],  the 
World   Investment   Report   ­   United   Nation   ­   1996  [154]   of   the 
Committee   on   Trade   and   Development   of   the   United   Nations; 
Challenges and recommendations for Vietnam in attracting FDI  
in the future [16, tr.174­188] of the representative of the European 
Chamber of Commerce in Vietnam ­ EuroCham; The report of the  
Australian Business Association in Vietnam (AusCham Vietnam)  
about jointly investigate and evaluate the direct investment from  
overseas   in   Vietnam   for   25   years  [16,   tr.189­191];   the   Japan 
External   Trade   Organization   ­   JETRO  with   the   work:   The  

investment   environment   in   Vietnam  [16,   tr.192­197],;  The  
investment   environment   in   Vietnam  [16,   tr.198­204],   by   Mark 
Gillin­Vice   President   of   American   Chamber   of   Commerce   in 
Vietnam  (AmCham),  "The  Relationship  Between  Foreign Direct  
Investment and China's Provincial Export Trade" [156] of Zhang 
and   Felmingham;   “Foreign   Direct   Investment   and   Relative  
Wages: The Case of China” [157] của Zhao.
2.The typical scientific works in Vietnam researching
related the topic
2.1.   The   reference   books   and   monographs  researching 
related the topic
A group of authors (Nguyen Bich Dat editor) with the work: 
Economic area of foreign investment in the socialist­oriented market  
economy in Vietnam  [45];  Foreign direct investment and economic  
development in Vietnam  [136] by Nguyen Van Tuan;  The form of  
foreign direct  investment  in Vietnam ­ Policies  and practices  [87] 
that science works by authors Phung Xuan Nha edited, compiled on 


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the   basis   of   findings   of   special   topics   Range   Vietnam   National 
University forms of foreign direct investment in Vietnam;  Foreign 
direct investment in Vietnam, the situation and the solution [138] by 
Tran Xuan Tung; Policies to encourage investment in Vietnam [17] is a 
book   by   Tran   Thi   Minh   Chau   author­editor;  Economy   of   foreign 
investment in Vietnam today  [70] that the book was compiled by the 
group   of   scientists   from   the   Institute   of   Political   Economy,   Public 
Administration Institute in Ho Chi Minh City National (now the national 
Political Institute in Ho Chi Minh City), by Tran Quang Lam and An 
Nhu Hai as co­editor;  Foreign direct investment by the United States  

transnational companies in Vietnam  [85] is a monographic book of the 
author   Dang   Hoang   Thanh   Nga;   The   book   “Policy   of   sustainable  
development of the major economic areas in Vietnam” [83], by Nguyen 
Van Nam and Ngo Thang Loi.
2.2. The thesis researching related the topic
2.2.1. Thesis on foreign direct investment
The   doctoral   thesis   by   Tran   Anh   Phuong:  A   number   of  
measures   to   attact   direct   investment   in   the   G7   countries   in  
Vietnam  [92];   The   thesis   of   national   economic   history   field: 
Attraction   of   foreign   investors   in   the   process   of   international  
economic integration of China period 1978 ­ 2003: The current  
situation and experiences for Vietnam [63] of Dang Thu Huong; 
Economic   doctoral   theisis   of   Tran   Quang   Thang   “  The   social  
­economic issues arise in foreign direct investment of some Asian  
countries   and   solutions   for   Vietnam”   [110];   Economic   doctoral 
theisis of Tran Thi Tuyet Lan, published in early 2014 “Foreign  
direct investments towards sustainable development in the major  
economic region of the North of Vietnam” [68].
2.2.2. The thesis of the major economy areas in the North of  
Vietnam


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  Economic   doctoral   dissertation     of   Ta   Dinh   Thi   “The  
economic   restructuring   in   view   of   sustainable   development   in  the 
major economy areas in the North of Vietnam”  [111], the authors 
Bach   Thi   Lan   Anh   with   her   doctoral   thesis   of   political   economy 
“Sustainable   Development   of   traditional   village   in   the   major  
economy   areas   in   the   North   of   Vietnam”   [1];   Economic   doctoral 
thesis of Vu Thanh Huong “Sustainable development of Industrial  

zone in the major economy areas in the North of Vietnam” [64], the 
author; Economic doctoral Thesis of To Hien Tha “The development  
of industrial zone the major economy areas in the North of Vietnam  
towards sustainability [104].
2.3. Dưới dạng các bài viết, tham luận khoa học, đề tài khoa  
học 
2.3.1. Về đầu tư trực tiếp nước ngoài, kinh tế có vốn đầu tư  
nước ngoài
2.3. The articles, scientific presentations, researches related  
the topic
2.3.1. The articles, scientific presentations, researches related  
foreign direct investment,  foreign investment economy
The  summary   record   of   the   Conference   of   25   years   foreign 
direct   investment   in   Vietnam   [16]   is   a   set   of   26   scientific 
presentations   by   scholars,   politicians,   scientists,   managers   of   the 
ministries,   branches,   localities   and   some   representatives   of 
international   organizations   such   as:   EUROCHAM,   AUSCHAM, 
JETRO,   AMCHAM.  "Foreign   Investment   Policy   in   the   process   of  
international   economic   integration"   [13]   is   a   scientific   paper   of   the 
Ministry   of   Planning   and   Investment   which   was   presented   at   the 
International Conference of Vietnam is ready to join the WTO which 
was organized in Hanoi from May 3 to June 4, 2003 by The national 
center of Sciences and Humanities and the World Bank in Vietnam; the 
author Phan Huu Thang  with the article "Summarizing 20 years of the  


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Law on Foreign Investment in Vietnam" [108] was published in the 
Journal of Economics and forecasting, No. 1/2008 Tran Van Loi with 
his article " Development of foreign invested economy ­ The issues and  

some   solutions"   [77].   Scientific   paper   "Improving   the   investment  
environment in Vietnam in international economic integration" [51] by 
Nguyen Van Hao; The article "Some basic solutions for developing and  
using foreign investment sector" [93] by Dr. Dinh Van Phuong and Dr. 
Hoang Thi Bich Loan; the article of Mai Van Bao " The contribution of 
foreign   investment   Economy   for   promoting   economical­social 
development of Vietnam "[7]; The article of Ho Thanh Thuy "Practical  
situation and prospects for economic development of foreign investment  
in Vietnam"  [122]   and  "Investing  abroad  with  the   development  and  
exploitation of human resources Vietnam today  "[47] by Nguyen Thi 
Nhu Ha; the scientific work of Pham Ngoc Anh "Attracting foreign 
investment   ­   From   HCM   ideas   to   reality   of   development  "[3]   was 
published in the book of Vietnam on major road (1945 ­ 2005) for the  
target   of   rich people,   strong country,  social  justice,   democracy   and  
civilization;  “The   basic   investigation   of   elements   of   sustainable  
development in the major economical zone”  [101] is scientific reseacher 
by Nguyen Danh Son as chairman; “Synthesis Report of overall socio­
economic in the major northern areas Planning to 2020 and orientations  
to 2030” [14] is a serious and careful work by the Ministry of planning 
and Investment to implement.
Besides, we also find a lot of articles which talked about ideas the 
data, practices, policies, decisions on FDI activities, attracting FDI in 
economic   regions   development,   major   economic   regions,   socio   ­ 
economic development of localities which were published in magazines: 
Communism, Economics and Forecasting, Economy and Development, 
Economic Development, Economic Research, Economic Management, 
Social   Labor,   Education   and   reasoning,   Asia   Pacific,   Finance, 
Banking ... or the website of the Ministry of Planning and Investment, 

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the Government web portal Minister, the website of the Department of 
Planning   and   Investment   and   localities   with   the   title   abundant   and 
diverse. This is the key document in the course of study by a large 
amount of information, timeliness, many new ideas.
3. General evaluation of the result of published
scientific works and the research issues of the thesis
3.1. General evaluation of the result of published
scientific works
The project has clarified many theoretical and practical issues 
on FDI and generalized on some contents as follows:
First,  these   works   have   achieved   many   important   results   in 
building   concepts,   analyzng   the   characteristics   and   generalizing 
forms, and other several theoretical issues on FDI.
Second, many scientific projects typically has appeared in the 
review which have analysised, argued quite profound on the status of 
FDI in Vietnam.
Third, one of the remarkable success of the scientific works 
which   have   been   published   is   the   recommend   of   orientation, 
perspective, solutions to resolve the shortcomings.
3.2. The research issues of the thesis
First, completing the theoretical framework on FDI as a solid 
basis for surveying the status of FDI in the major economical areas in 
the north of Vietnam period 2003 to 2013.
  Second,  basing on the theoretical framework and surveys of 
FDI attraction situation in some countries of the world in order to 
draw the experiences of the field for the major economical areas in 
the north of Vietnam.
  Third,  basing   on   the   determined   theoretical   framework, 
especially  the  criteria  for   evaluating  the  results   of   FDI,   the   thesis 

conducted   a   survey   to   assess   the   status   of   FDI   in   the   major 
economical areas in the north of Vietnam period 2004­2013.


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  Fourth, the theories and practice have shown in Chapters 1 
and Chapter 2, the thesis suggests some basic and key measures to 
attract  FDI  inflows  in the major  economical  areas  in  the  north of 
Vietnam in the next period.


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Chapter 1
THE THEORY AND EXPERIENCES OF THE FOREIN
DIRECT INVESTMENT
1.1. The theory of forein direct investment
1.1.1. The process of formation and development; concept,  
characteristics and forms of foreign direct investment
1.1.1.1.  The process of formation and  development  of foreign  
direct investment
The bourgeois economists as A.Smith (1776), Thomas Malthus 
(1798),   D.Ricardo   (1817),   and   later   as   Vernon   (1966),   Kojima 
(1973), Hymer (1976), Dunning (1988 ) ... said the formation and 
development of international investment which had theoretical basis 
was   the   division   of   labor   based   on   comparative   advantage   and 
international trade.
The Marxist political economists and the typical representative 
as VILenin said that the growth of FDI is based on capital exports.
1.1.1.2. The concept of foreign direct investment
Researching,   inheriting   the   previous   research   results,   from 

practical   existence,   movement   of   FDI,   the   author   can   come   to   a 
concept that:
   Foreign   direct   investment   is   the   movement   of   capital,  
technology or legal asset classes move from investment countries to  
investment­receiving countries to establish new businesses or control  
the enterprise is operating on basis of international rules and laws of  
the host country, to business and profit.
1.1.1.3. The characteristics of  foreign direct investment .
FDI is not simply a transfer of capital resources but also to 
embrace the technology transfer process, aiming to help the major 
economical areas in the north of Vietnam become a bright spot, a the 
most developed centre of economic growth of the northern region 


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and in  the whole  country and    the major  economical  areas  in  the 
north   of   Vietnam   itself   integrate   with   many   favorable   factors   for 
realizing the goal of FDI.
To implement this, we should base on the practical situation of the 
country,   local   authorities   in   the   region;   Researching   and   selectively 
acquiring international experience to apply a creative way on the specific 
circumstances. In this chapter, the fellows were selected studies, surveys 
on   operational   experience   of   several   countries   of   FDI   which   has 
similarities,   from   which   to   draw   useful   lessons   for  the   major 
economical   areas   in   the   north   of   Vietnam.   That   is   the   lesson   of 
orientation towards FDI for each stages; lessons on mechanisms and 
policies for FDI by economic sector, economic regions to implement 
macro   objectives;   lessons   on   creation   of   investment   climate   and 
favorable business, competitive.
The next problem, the thesis must focus on the research, reviews 

the true state of FDI in  the major economical areas in the north of 
Vietnam  now,   clearly   identify   the   issues   to   be   addressed   from   that 
perspective proposals, solutions legal process  and use FDI  attraction 
next time in this economic area more effectively.


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Chapter 2
ACTUAL SITUATION OF FOREIGN DIRECT INVESTMENT IN 
THE MAJOR  ECONOMICAL AREAS IN THE NORTH 
OF VIETNAM PERIOD 2003­2013
2.1.   Outline   the   process   of   formation   and   development; 
potential,   strengths   and   difficulties   and   challenges   for   foreign 
direct investment of  the major economical areas in the north of 
Vietnam 
2.1.1. Outline the process of formation and development of  
the major economical areas in the north of Vietnam
The   major   economical   areas   in   the   north   of   Vietnam  was 
historically formed and developed from the early years of 90s of the 
twentieth   century   and   is   known   as     the   major   economical   areas 
included   7   provinces   are:   Ha   Noi;   Hai   Phong;   Quang   Ninh,   Hai 
Duong, Huong Yen, Bac Ninh, Vinh Phuc that is associated with the 
issuance of Resolution No. 15/2008 / NQ­QH12 on the adjustment of 
the administrative boundaries of Hanoi and related provinces adopted 
on May 29, 2008
2.1.2. The potential and strength the major economical areas  
in the north of Vietnam with foreign direct investment
First, the major economical areas in the north of Vietnam  have 
particularly   important   position   in   economy,   politics,   culture   and 
society in the north and in the country.

Second,  the major economical areas in the north of Vietnam 
has  diversity   of   natural   resources   and   humanitarian   resources   for 
economic­ social development and investment attraction.
Third,  the major economical areas in the north of Vietnam   has 
outstanding strengths of human resources compared with other regions.
Fourth, the major economical areas in the north of Vietnam 
has  technical infrastructure and social infrastructure development.
In addition, the market is also one of the strengths of the major 
economical areas in the north of Vietnam  for FDI attraction
2.1.2.   The   difficulties   and   challenges   for   foreign   direct  
investment of  the major economical areas in the north of Vietnam 


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That   is   the   difficulty   in   changing   the   land   use   purposes   to 
manufacturing   industry,   building   economic   infrastructure   ­   social 
service   investment   activities;   the   effects   of   weather   and   climate; 
quality human resources
2.2.   Results   of   foreign   direct   investment   in   the   major 
economic regions in the North of Vietnam period 2003 ­ 2013
2.2.1. The quantity and scale of project
2.2.1.1. The number of projects and total registered capital
2.2.1.2. Scope of project
2.2.2. Structure of projects of foreign direct investment in the  
major economic regions in the North of Vietnam
2.2.2.1. Foreign direct investment by economic fields
2.2.2.2. Foreign direct investment in the form of business
2.2.2.3. Foreign direct investment by nationality
2.2.2.4. Foreign direct investment by province
2.3. Achievements, limitations and problems faced by foreign 

direct investment  investment  in  the   major   economic   regions   in 
the North of Vietnam
2.3.1. Achievements and Causes
2.3.1.1. Achievements 
Firstly,  production and business investment in FDI enterprises in 
the major economic regions in the North of Vietnam have increased 
significantly,   contributing   additional   important   source   of   economic 
development.
Second, the scale and quality of human resources in the area of FDI 
increasingly   been   raised;   the   level   of   technology   in   enterprises   with 
foreign investment are also increasingly improved.
Third, the position of the role of FDI is increasingly high.
2.3.1.2. The cause of achievements
* The objective reasons.


16
First,  the  achievements   of   FDI   in  the  northern  major   economic 
region   is   due   to   the   correct   guidelines   and   policies   of   economic 
development   of   the  Party  and  State,   especially   policies   for   FDI   is   an 
important content.
Second, the priorities of the Central Government to the development 
of major economic regions, especially in the construction of economic ­ 
society infrastructure  has created for in the northern major economic region 
certain advantages for FDI.
* Subjective reasons.
First, the northern major economic region is a safe destination and 
attraction of foreign investors by the political security situation and 
social order and safety with stability.
Second, the perception of the role of FDI and the need to attract 

FDI have raised one step.
Third,  the locality of the northern major economic region has 
made great efforts in promoting the potential and strengths of each 
region and locality to FDI.
Fourth, one of the causes of the success of FDI of the northern 
major economic region in recent years is due to the development of 
industrial parks in this region.
2.3.2. Some restrictions and limitations cause
2.3.2.1. Some restrictions
First,  FDI   in  the   northern   major   economic   region  also   has 
limitations   and   shortcomings   in   terms   of   growth   rate,   size   and 
structure.
Second,  production   technology   in  the   FDI   enterprises   in  the 
northern major economic region despite achieving at the advanced level 
compared to the national average, but compared to other countries in 
the region, it is only in the universal level.
Third, human resources in FDI enterprises also have limitations 
and shortcomings.


17
Fourth,  there   were   some   economic­   society   problems   arise 
during the operation of FDI.
2.3.2.2. The cause of limitations
* Objective reasons.
   First of all, not to mention the state of the global economic 
slowdown due to the financial crisis, the currency took place in late 
2007 and lasted until the end in recent years and no clear recovery 
made commercial activities and investments influenced.
One reason is also very important as to the growth of FDI in the 

northern major economic region  last   time   is   not   desirable   from   the 
weaknesses of Vietnam's economy, an economy that was in low level 
of development, easily influenced by external factors.
* In addition to objective reasons, the limitations of FDI is the  
consequence of the subjective reasons below:
First, the aware of the position and role as well as the necessity 
of FDI have not really unified high.
Second,  while competition to attract FDI continued fierce and 
aggressive, the investment environment of Vietnam in general and 
localities   in   the   northern   major   economic   region   although 
significantly improved, but progress the gain is not fast, especially in 
comparison with the southern key economic region.
Third,  the management  of  the state of foreign investment  at 
both   central   and   local   first   time   reveals   a   lot   of   weaknesses,   just 
loose,   medium   deep   intervention   into   the   operation   of   foreign­
invested enterprises.
Fourth, investment promotion, despite many attempts, but has 
not really become active mainly of state authorities, not high quality.
Fifth, industry support (auxiliary) of Vietnam in general and in 
particular   the   northern   major   economic   region   inadequacies   still 
many   factors,   not   meeting   the   requirements   of   economic 
development ­ social, investment attraction.


18
2.3.3. The problems faced by foreign direct investment in the  
major economic regions in the North of Vietnam
2.3.3.1. Conflicts between the interests of investors with national  
and regional interests in the activities of foreign direct investment
2.3.3.2.   Conflicts   between   the   high   demand   for   resources,  

especially human resources of foreign investors with the status of local  
resources in the region, there are certain limitations
2.3.3.3. Conflicts between high requirements on the management  
of   state   for   foreign   direct   investment   and   the   state   of   the   state  
management in this area in the northern major economic areas still  
limited and inadequate
Conclusion of Chapter 2
FDI   activity   has   important   significance,   thereby   forming   a 
dynamic economic region, promoting the mobilization of the sector 
in various economic structures operating in the transitional period 
up socialism in Vietnam in general and in particular in  the northern 
major economic region.
In   the   context   of   globalization   and   international   economic 
integration   today,   attracting   FDI   in  the   northern   major   economic 
region  the  rule  issues,   an  economic  necessity  in  order   to  put   the 
local   in   the   rapid   progress   on   the   path   of   industrialization 
modernization.
Recognizing the importance of the issue, FDI in these areas has 
had   important   developments   the   years   with   the   efforts   of   the 
subjective   levels,   sectors   and   people.   Thereby   the   addition   of 
investment   capital   for   development   that   making  the   region's   GDP 
growth is high continuously for years, the economic structure shifted 
towards modern, creating jobs and raising incomes for many workers 
... However, considering the potential and available advantages and 
investment from central government, this development is not really 


19
adequate, especially considering the southern major economic region; 
the amount invested has manifested slowdown in recent years, the 

investment  structure  was  unreasonable;  have  economic  problems  ­ 
social arise in attracting FDI.
From   assessing   the   situation   of   FDI   in   the   northen   major 
economic regon, we could see some emerging problems to resolve 
that   concern   to   the   interests   of   each   parner   in   FDI   projects; 
regarding the mobilization and use of resources, especially human 
resources for FDI; relating to the management of the State on FDI. 
Therefore,   the   important   thing   now   is   to   set   out   the   research, 
selection   and   effective   way,   and   to   remove   the   obstacles   and 
attract FDI in this economic area next time.


20
Chapter 3
VIEWPOINTS AND SOLUTIONS ATTRACTING FOREIGN 
DIRECT INVESTMENT IN THE NORTHERN MAJOR 
ECONOMIC REGION IN THE FUTURE
3.1. Viewpoint attracting foreign direct investment in the 
northern major economic regions 
3.1.1. Attracting foreign direct investment should be placed  
in close relationship with domestic investment attraction
During the period of transition to socialism, the northern major 
economic regions as well as other areas in Vietnam, and exist many 
types of ownership, which is the existence of many economic sectors, 
including   FDI.   The   economic   area   exists,   although   there   are 
differences   in   the   position   and   role   in   the   overall   development 
process, yet there are close relationships with each other, influence 
each  other   dialectically.   The  development   of   any  economic   sector 
have a direct impact in varying degrees to the development of the 
sector   remain.   Therefore,   FDI   in   the   northern   major   economic 

regions   should   be   placed   in   close   relationship   with   domestic 
investment, FDI sector development should be placed in relation to 
the   development   of   various   areas   of   the   background   economic, 
forming a unified body of the development.
3.1.2. Taking economic­ social efficiency, defense ­ security as  
basic   standards   in   attracting   foreign   direct   investment,   aiming   at  
sustainable development
Views of Vietnam in general and the northern major economic 
regions in particular in evaluating the effectiveness of the investment 
project to regional development and FDI is taking progressive social 
stability as a basis, but the economic ­ social effects, defense ­ security 
must be regarded as the leading standard.
These standards, particularly the evaluation criteria of economic 
­ social efficiency, defense ­ security of an investment project is quite 
complex   and   needs   to   be   thoroughly   studied   and   taken   seriously, 
contributing   to   economic   development   in  the   northern   major 
economic regions socially sustainable way.
3.1.3.   Promoting   the   independence,   initiative   in   attracting  
foreign direct investment
In the context of the capitalist forces that govern the process of 
economic globalization, the dominant fields of trade and investment 


21
and to attract FDI effectively but keep up the socialist orientation, 
maintain national cultural identity of regions to uphold the initiative 
in the development process.
Proactively in attracting FDI is the process of self perceived 
objectivity   of   the   process   of   development,   voluntarily   choose   the 
form, pace and appropriate way ; to promote the autonomy of the 

State management agencies all levels and departments, businesses ... 
ensures the development process does not cause adverse mutation, 
maintaining stability in all areas but primarily economic stability ­ 
social of the localities in the region.
Proactively   in   attracting   FDI   requires   as   well   the   study 
forecasts the economic situation in the country, the region and the 
world, the trend of movement of foreign investment flows to time 
there   have   policy   decisions   correctness,   mechanisms   and   policies 
accordingly.   Along   with   that,   the   need   to   adjust,   change   as 
decentralized and suggest adjustments, changing the system policies 
and   laws   to   adapt   to   the   fluctuations   of   the   real   situation   and 
international rules; Steps also have to create economic restructuring 
towards   best   exploiting   existing   advantages   to   enhance   the 
competitiveness of the economy.
Proactively   in   attracting   and   using   FDI   to   persevere   motto 
multilateralisation   and   diversification   of   international   economic 
relations,   promoting   the   advantages   of   the   region   in   international 
labor division, boosting production and development strong direction 
for   export;   while   exploiting   the   resources   from   many   different 
directions   to   serve   the   diverse   needs   of   industrialization   and 
modernization.
3.1.4. Attracting foreign direct investment on the basis of the  
leadership of the Party and the administration of the State
Socialist orientation in attracting and using FDI as matters of 
principle should be thoroughly grasp and perform consistently to the 
fullest the opportunities and minimize to the lowest level of negative 
impact economic ­ society development as a whole of the region.
The essence of the socialist­oriented hold in attracting FDI in 
the   northern   key   economic   region   is   now   on   building   an 
independent   economy,   sovereignty,   towards   the   development   of 

FDI   in   implementing   the   socio   ­   economic   goals   of   the   region,  
making the position and force of the increasingly high up in every 
step   of   the   FDI   sector,   contributing   to   the   country's   overall 


22
objectives   are:   rich   people,   strong   country,   democracy,   fair   and 
civilized.
To keep the socialist orientation in attracting FDI in the current 
the   northern   major   economic   regions  should   note   the   following 
fundamental issues:
Firstly,  often uplifting revolutionary vigilance, ready to frustrate 
any   conspiracy   and   sabotage   tactics   of   enemy   forces   with   peace 
movements in the economic field.
Secondly,  the leadership of the Party and State's management at 
both central and local must constantly be strengthened.
Thirdly,  maintain the principle of  equality, mutual benefit and 
cooperation in investment.
3.2.   Solutions   to   attract   foreign   direct   investment   in   the  
northern major economic regions
3.2.1.   Unity   awareness,   innovative   thinking   in   attracting  
foreign direct investment
This is a solution that is extremely important, as the basis for 
the implementation in practice, because awareness is the basis for 
action,   there   is   a   new   awareness   right   there   right   action,   thereby 
overcoming the deviant tendencies in attracting FDI.
In doing so, it should focus on the content requirements of the 
following:
First, make the levels and sectors and all citizens have the right 
perception, full of the role of FDI.

Second, along with the affirmation of the positive impact of 
FDI   on   economic   ­   society   development   should   also   indicate   the 
reverse of FDI.
Third,   clarify   the   necessary   objectivity   to  attract   FDI   in  the 
northern   major   economic   region   in   particular   and   in   Vietnam   in 
general.
Fourth, innovative thinking in attracting FDI. Accordingly, the 
northern major economic region should make significant changes to 
attract FDI from site run by volume alone to select the projects with 
quality,   high­tech,   environmentally   friendly   and   suitable   for 
orientation economic restructuring of each sector and local ...
3.2.2. Research building, completed master plan projects with  
foreign investment


23
Directive   32/1998   /   CT­TTg   of   September   23,   1998   of   the 
Prime   Minister   has   been   clear,   planning   is   one   of   the   important 
stages   of   the   process   of   planning   the   national   economy. 
Accordingly, if the strategy is the basis for the zoning plan will be 
the   basis   for   planning   economic   ­   social   development.   The 
formulation   and   implementation   of   development   planning   FDI   is 
expressed concretely in the implementation of the guidelines  and 
policies of the Party and State in the field above. Business planning 
is also one of the important tools for central government to local 
levels   perform   their   management   function.   Only   on   the   basis   of 
planning, overall planning, science, new feasible to create favorable 
conditions for the implementation of foreign investment projects.
The building, completed master plan for FDI projects in  the 
northern   major   economic   region  should   keep   abreast   of   specific 

requirements and comply with a strict process.
First,   the   government   should   direct   the   agencies   and 
departments   concerned   as   well   the   investigation,   examined   the 
situation of foreign investment in recent years in the province areas, 
evaluate   the   impact   and   effectiveness   of   foreign   investment 
activities.
Second, conduct research, acquire experience in building the 
overall   planning  of   the  FDI   projects   in  economic   zones   and  key 
economic regions in the country, foreign experience.
Third, based on the survey results, survey and the experiences 
gained   in   other   regions,   conducted   in   drafting   planning, 
consultation   of   the   functional   departments,   economic   experts, 
consult the people.
3.2.3.   Construction,   upgrading   economic   ­   social  
infrastructure;   development   of   supporting   industries   to   create  
attractive for foreign investors
The   construction   and   upgrading   of   economic   ­   social 
infrastructure future years should note the following issues:
Firstly, new construction combined with the upgrade, stop the 
degradation of the transport system in the whole region.
Second,   the   need   to   invest   in   building   new   and   upgrading 
existing power grid to meet the demand for electricity for production, 
particularly in the industrial zones, industrial complexes where many 
FDI enterprises operate.


24
Third, expand and upgrade their telecommunications system in 
the province.
Along   with   the   development   of   economic   ­   social 

infrastructure,   strong need  to  develop supporting  industries   on the 
basis of the following measures:
First, the creation of the investment environment, encouraging 
the development of production and business.
Second, the state should develop and promulgate a system of 
technical   standards   of   product   quality   according   to   international 
standards as a basis for industrial development, oriented support in 
the northern major economic region.
Third, to enlist walk fast, strong, effective programs to build 
long­term   cooperation   with   strategic   partners,   companies, 
multinational corporations of industrial development in general and 
industrial supported in particular.
Fourth, accelerate the construction of infrastructure.
Fifth,   create   favorable   conditions   for   small   and   medium 
enterprises access to long­term loans for development investment.
Sixth, early build effective database.
3.2.4.   Gradually   develop   human   resources   to   meet   the  
requirements to attract foreign direct investment
In the basic resource for economic ­ society development in 
general and FDI in particular, human resources have a decisive role.
With  a   rich  cultural   tradition,   from   the   achievements   of   the 
renewal   process   of   the   country,   the   years,  the   northern   major 
economic   region  has   trained   a   team   of   experienced   workers   in 
various fields and this team has really is the main factor determining 
the quality of economic growth, promote FDI developed with high 
speed.   Nevertheless,   the   human   resources   service   of   economic 
development   ­   economic   development   zone   are   still   many 
shortcomings factors, including human resources working in foreign­
invested enterprises. The irrationality on should be overcome in time 
to meet the requirements of a new period of development. In doing 

so,   it   should   thoroughly   understand   and   implement   the   following 
fundamental issues:
First, continue to promote the socialization of education and 
training.


25
Second,   build   new   and   enhanced   facilities   for   vocational 
schools and vocational training centers, technical centers synthesis.
Third, improve the quality of teaching staff and managers in 
the training facility.
3.2.5.   Improve   effectiveness   of   State   management   of   foreign  
investment
The enhancement of management efficiency state, the northern 
major economic region FDI in the future should focus on some of the 
following measures:
Firstly,   study   and   complete   policies   to   encourage   foreign 
investment.
Second, continue to reform administrative procedures towards 
simple, compact, creating favorable conditions for foreign investors.
Third,   strengthen   the   supervision  of   licensed  businesses   and 
active.
Fourth, as well the promotion of investment.
Fifth,   the   continuous   improvement   of   state   management 
apparatus of FDI.
The conclusion of chapter 3
Foreign   direct   investment   in  the   northern   major   economic 
region  by experts assess as potential and development opportunities 
in the future. However, the growth was achieved in the extent, scope 
and level of how sustainable or unsustainable depends largely on the 

willingness   of   the   subjective   state   management   agencies   in   the 
Central Foreigners , of the Party, the government and the local people 
here through the grasping and implementing the basic perspective, 
the key measures outlined how.
Accordingly, the basic point must thoroughly understand is: 
Attracting FDI must be associated with investment in the country; 
taking economic ­ social efficiency, defense ­ security as the basic 
criterion   in   attracting   FDI;   to   uphold   the   independence   and 
initiative  in attracting FDI;  to sustain the principles   of   equality, 
mutual benefit is actually resolved harmoniously benefit relations 
between   the   parties   in   attracting   FDI;   to   sustain   socialist 
orientation in attracting FDI.
The solution implemented concern include unified awareness, 
innovative thinking in attracting FDI; complete master plan projects 
the   FDI;   construction,   upgrading   economic   ­   social   infrastructure,