Among those proposal, Chairman of Korea Chamber of Business in Vietnam (Korcham) - Ryu Hang Ha listed out some legal issues under the Vietnam’s current law which causes difficulties for Korean investors.
According to him, in the past, the Export and Import Tax Act and the Enforcement Decree stipulated that “the export duties shall not be imposed on the manufactured products of which raw materials were imported for the purpose of export.” Therefore, export duties had not been imposed in the past.
However, the Export and Import Tax Act (seventh clause of the article 16, 107/2016/QH13) was revised on April 6th, 2017, and the Enforcement Decree (the article 12, Decree 134/2016/NDCP) became effective on September 1st, 2016. And, the phrase “the export tax shall not be imposed” was deleted. Therefore, the relevant government agencies are interpreting this as imposition of export duties. As of now, export duties are imposed on products.
Chairman of Korea Chamber of Business in Vietnam - Ryu Hang Ha
“For example, 7 to 10% of export duties are imposed on aluminum products. For this reason, many aluminum product manufactures are faced with difficulties while exporting those products from Vietnam, because they have lost price competitiveness in overseas markets. As of now, the Korean government and the Chinese government do not impose export duties on aluminum products. This is to contribute to the development of domestic industries by securing price competitiveness in the overseas markets. We would like to request the Vietnamese government to exempt export duties for aluminum products. This would enable aluminum product manufacturers to secure price competitiveness and contribute to the industrial development in Vietnam”, Ryu Hang Ha said.
It has already been 25 years, since Korea and Vietnam established diplomatic relationships. Therefore, this year is incredibly meaningful. In the meantime, the two countries have built a strong relationship for economic cooperation. The bilateral trade volume has greatly increased thanks to the Korea-Vietnam FTA. Korea‟s investment in Vietnam has been increasing year by year. And, now, Korea is the no.1 investor in Vietnam. The global companies in Korea as well as the Korean SMEs are choosing Vietnam as their new investment destination.
According to the survey conducted with Korean companies, which invested in Vietnam, at the end of last year, 46.1% of the respondents said they would increase their investment while 44.7% of the respondents said they would remain at the current level for their investment. In addition, 71% of the respondents said they are satisfied with their business management in Vietnam.