Since national reunification in 1975, Vietnam’s economy has grown from strength to strength. Senior economist Nguyen Mai writes about how the economy has developed in that time, with foreign direct investment serving as one of the key driving forces.

As the country faces an unexpected economic crisis, industrial zones are reeling to protect enterprises vulnerable to diseases, especially those labour-intensive businesses that play an important role in the nation’s exports.

The growth of FIEs in Vietnam has recently raised increasingly complicated tax concerns. These problems arise primarily from the practical issues of determining the transaction price between FIEs and their related parties.

The number of businesses established in 2019 increased by 5.2 percent, but the number leaving the market rose more sharply, by 20.2 percent, compared with 2018.

Local authorities are trialing ways to prevent multinationals from structuring affairs in order to divert profits to low tax jurisdictions.

The Vietnamese government is on the way to remove roadblocks for foreign-invested enterprises to raise public capital on local bourses, in a signal to attract more overseas attention.

Vietnam has borrowed big money to develop industrial infrastructure, but this has mostly brought benefits to foreign invested IZs (industrial zones) and FIEs (foreign invested enterprises).