Vietnam govt encorages bank to invest in Laos
The Government of Vietnam has asked its leading bank to help support an expansion of Vietnamese investments abroad and particularly in Laos after its outbound investment to this country decreased last year.
An aim of the move is to boost Vietnamese investment in Laos which should further generate benefits to both nations.
Vietnamese Prime Minister Nguyen Xuan Phuc was speaking at a ceremony in Hanoi recently to mark the 60th founding anniversary of the Bank for Investment and Development of Vietnam (BIDV).
The PM was quoted in Vietnamese News as saying that the BIDV must consider assistance to Vietnamese companies as its international mission, helping to speed up Vietnam's global integration and enhance its prestige, with stronger initial focus on Laos, Cambodia and Russia.
The Vietnamese PM also urged the bank to assist in engagement in the reform of credit institutions, focus on settling bad debts and monitoring banks with poor performance, as the largest joint stock commercial bank in the country.
At the same time, the BIDV was encouraged to continue improving its financial management, thus entering the list of top 25 largest commercial banks in Asean.
The BIDV's current charter capital of about US$1.5 billion remains lower than that of many regional banks.
Laos is already one of the largest destinations for outbound investment from Vietnam as a result of the enhanced special solidarity and comprehensive cooperation enjoyed between the two neighbouring countries.
Vietnam is the third largest foreign investor in Laos after China and Thailand.
As of January 2017, Vietnam had channeled US$21.4 billion into 1,188 projects across 70 countries and territories worldwide.
Of the total, some US$5.12 billion and US$2.89 billion, respectively, was invested in the two neighbouring countries of Laos (270 projects) and Cambodia (91 projects).
Other popular investment destinations included Russia and Africa.
According to a recent Vietnam News report, the Vietnamese government has been working to better enable its domestic investors move beyond borders.
At present Vietnamese investment in Laos is mainly in the resource sector, notably in the mining, hydropower development, agriculture and construction sectors.
Last year, China overtook Vietnam to claim the number one position as the largest foreign investor in Laos, according to a latest annual report from the Ministry of Planning and Investment.
China's investment last year soared to over US$1 billion compared to US$88.9 million in 2015 while Vietnam's investment decreased by US$4.5 million in 2016 after registering US$466 million in 2015.
However, economists are optimistic that Vietnamese investment in Laos will continue to grow despite any regional economic setbacks.
The economists also note that several Vietnamese investment projects in Laos that had been delayed had now been revitalised, including shopping centre construction projects, giving new hope that the two countries would boost their economic cooperation.
Laos and Vietnam are not only good neighbours but also key trading partners.
Relevant officials from both sides are in regular contact and meet annually to discuss how to enhance their cooperative relations in all areas including economic aspects.