Improving the investment environment for joint ventures in Ho Chi Minh city, Viet Nam

Since 1986, Viet Nam has embarked on a comprehensive economic renovation program to transform itself from a centrally-planned to a market economy. Foreign direct investment has played an important role in the development process, in which joint ventures (JVs) has emerged as the most preferred form of foreign investment. As host country, Viet Nam expects to acquire capital, new technology and job from JVs. From the other side, foreign partners hope to utilize Vietnamese cheap labor and abundant resources and the incentives offered by the Vietnamese government. However, current developments started showing signs of change in the foreign investment pattern. Foreign investors have been increasingly choosing the form of 100% foreign-own capital rather than a joint venture. There are many difficulties and obstacles which stand in the way of the foreign investors who want to proceed their investment in the form of JV. The major impediments can stem from the country’s environment, the government policy and the local partners. The research attempts to understand the situation and suggest some recommendations to improve the investment conditions to promote JVs in the future.