Real estate top investment for Viet Kieu

A survey on Viet Kieu (overseas Vietnamese) investment at a conference on establishing the Overseas Vietnamese Businesses’ Association revealed that most wish to invest in real estate.

Secretary General of the Overseas Vietnamese Businesses’ Association Pham Thieu Hoa stated that the main Viet Kieu investment areas in the next few years will still be real estate, tourism and technology transfer.

The Viet Kieu Village project in Hai Phong, underwritten by Viet Kieu investors in the UK, received a license on January 10, 2010. The project for an international hospital with 300 beds was also licensed on the same day.

According to Hoang Van Ke, Deputy Chairman of Hai Phong People’s Committee, Hai Phong has 20 Viet Kieu projects. These include a garment factory employing 4,000 workers by Pham Minh Nam, a Viet Kieu in the UK, and  a villa complex capitalized at 20 million dollar by a Viet Kieu in Germany.

Viet Kieu projects in Hai Phong have been carried out mostly via relatives in Vietnam. According to the Hai Phong Branch of the State Bank of Vietnam, Hai Phong has received some $500 million worth of “kieu hoi” (overseas remittances) in the last five years.

Overseas remittances have been stable at $150 million per annum since 2008.

A portion of the kieu hoi has been injected into investment projects, though there has been no survey that clarifies the exact percentage.

Hai Phong has attracted some three billion dollars worth of foreign direct investment (FDI), including $70 million in investments from Viet Kieu. Many projects are well known in Hai Phong thanks to their high efficiency, such as the $30 million Vietnam-Australia Steel project and Thien Vinh footwear project invested by a Viet Kieu in Japan.

Le Truong Son, Member of the Executive Board of the Overseas Vietnamese Businesses Association in Russia, noted that a lot of Vietnamese businesses in Russia have returned to Vietnam to invest. They have become the main shareholders in some Vietnam’s large banks such as Techcombank, VIB Bank, or big trade centres such as Melinh Plaza, Furama Hotel, and Eurowindow.

Son said that Viet Kieu investment will increase if they can receive updated information about investment incentives and projects calling for investment.

Pham Van Thanh, Chairman of the Vietnamese Entrepreneurs in Canada, observed that much of the kieu hoi sent from the US, Canada and Australia to relatives in Vietnam cannot find investment opportunities.

Thanh warned that kieu hoi will reduce in 10-20 years, when there are no more people who have close relatives in Vietnam. Their children, grandchildren and next generations will not have money to send to Vietnamese relatives like their parents or grandparents do.

Thanh said that there are not many “millionaire Viet Kieu,” but there are numerous Viet Kieu who have assets of $500,000 dollar to one million. They want to purchase houses to live in Vietnam or to set up small businesses, but they are still reluctant to make the investment.

VietNamNet/TP

Tags: vietnam real estate market