The Ministry of Finance in Vietnam has voiced an opinion that it may be worth reviewing the country’s policies regarding the investments of offshore companies that they need to pledge in order to receive authorisation to participate in the development of an integrated resort (IR). At the moment the minimum investment is set at $2 billion, which does not do much to attract the interest of foreign parties.
The Necessary Payment Could Be Calculated Differently
Not only is the minimum investment high as it is, according to the current regulations $1 billion of that sum has to be paid just to be granted the permission to invest. Since that does not invite overly many applicants, the Ministry of Finance suggested to the Prime Minister that while calculating the base amount of capital which has to be disbursed to obtain the authorization, they could include investor money contributed to other special administrative-economic zone projects (SAEZ).
The prepayment could thus be significantly cut down making it more feasible for foreign companies to take part in the IR construction. Moreover, the parts of the country which are underdeveloped would receive a substantial boost, so that rural districts such as Van Don may receive some attention, which was avoiding them so far due to the excessive requirements. Van Don in Quang Ninh province has been picked out as a potential location for SAEZ. Two other areas are being considered: Bac Van Phong in Khanh Hoa, and Phu Quoc in Kien Giang.
Not Everyone Is on Board with the Idea
The proposal of the Ministry of Finance was met by opposition from the Ministry of Planning, which claimed it would be inappropriate at the present time, even though it did not specify why. The Ministry of Defense was of a similar opinion but it provided a bit more tangible response stating that it would not be fair to those who have already made sizeable investments into the IR.
The Country May Be Growing Less Opposed to Gambling
While the citizens of Vietnam are currently not allowed to enter into any of the seven casinos in the country, the government initiated a research last year focused on whether or not locals should be permitted to participate in legal gambling. As part of the program, three of the casinos will accept Vietnamese players in their properties. First of them started welcoming the locals in January and it was the Corona Resort. Second of them, backed by Suncity Group, is due to begin receiving them by the end of this fall. The last venue has yet to be announced.
The financial reports from the Royal Casino in Quang Ninh suggest that if the current requirements on the $2-billion investment stay in place, the country is not likely to receive many more applications from foreign companies. In 2018, the casino’s after-tax profit was only $731,263 and that was the first time in three years that the number was positive.