Analyzing the conditions and policies to attractforeign direct investment capital of brazil, therebydrawing lessons and practical experiences for vietnam

UNIVERSITY OF INTERNATIONAL ECONOMY INSTITUTE OF INTERNATIONAL TRADE AND ECONOMY DEPARTMENT OF INTERNATIONAL ECONOMY PERSONAL EXERCISES FOR INTERNATIONAL ECONOMY SECTION Thesis: Analyzing the conditions and policies to attract foreign direct investment capital of Brazil, thereby drawing lessons and practical experiences for Vietnam Student's full name : Vu Anh Quan Student code : 11218039 Specialties : Management Science Part class : International Economics (222)_09 System : Regular Instructor : Assoc Prof Dr Nguyen Thuong Lang Email : langnt@neu.edu.vn , langnguyen3300@gmail.com Tel : 0983478486 Period of study : Semester of the academic year 2022-2023 phone number : 0965230663 Student email : quanvu389203@gmail.com Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng GUARANTEE I hereby declare that this assignment is entirely my own work The quotations and materials used in the exercise are completely honest, are sourced from and guaranteed to the highest degree of accuracy to the best of my knowledge If it is not as stated above, I take responsibility for my assignment Hanoi December 23, 2022 Students perform THANK YOU First of all, I would like to express my deep gratitude to the lecturers of the National Economics University in general and the lecturers of the Institute of International Trade and Economics in particular, who have dedicatedly taught and communicated to us valuable knowledge and experience Especially, I would like to thank Assoc.Prof.Dr Nguyen Thuong Lang, who directly guided me throughout the course of the exercise During the time working with you, I have not stopped learning to accumulate a lot of useful knowledge for myself, but also have learned the spirit of serious and effective work, these are very necessary things for me in my career future study and work Finally, I would like to express my sincere thanks to my family and friends who have always encouraged, contributed ideas and helped in the process of studying and researching to complete this exercise Hanoi, December 23, 2022 Students perform Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Table of contents Prologue .3 Chapter : Theoretical basis of FDI capital 1.1 Theory of FDI Important characteristics of FDI capital Brief statistics and movements of FDI in recent times 1.1.1 Foreign Direct Investment (FDI) .6 1.1.2 The role of FDI capital 1.1.3 Factors attracting FDI inflows 1.2.1 Brief statistics and movements of FDI in recent times 11 Chapter Outstanding achievements in attracting FDI in Brazil Analyze the characteristics and conditions of Brazil in attracting foreign capital .13 2.1 The situation of attracting FDI in Brazil .13 2.1.1 The situation of FDI capital invested in Brazil in recent years 13 2.1.2 Major investment countries 13 2.1.3 Major investment industries .14 2.2 Conditions and policies of Brazil in attracting FDI 15 2.2.1 Market size .15 2.2.2 The stability of the economy 16 2.2.3 Labor costs and productivity 16 2.2.4 Business environment 17 2.2.5 Tax incentives 17 Chapter 3: Experiences and practical lessons that Vietnam has learned from Brazil's conditions for attracting FDI 18 3.1 Current situation of FDI inflows into Vietnam 18 3.2 Current conditions and policies to attract FDI in Vietnam 20 3.2.1 Market size .20 3.2.2 The stability of the macro-economy 20 3.2.3 Commercial expansion 21 3.2.4 Infrastructure 22 3.2.5 Tax incentives 24 3.3 Experiences and practical lessons that Vietnam has learned from Brazil's FDI attraction activities 25 Conclusion 27 List of references 28 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Heading The necessity of choosing a topic Brazil is a mixed economy country developing countries , by 2020 the country is the twelfth largest economy in the world by nominal gross domestic product (GDP) and the eighth largest by purchasing power parity According to estimates by the International Monetary Fund (IMF), Brazil's nominal GDP in 2020 is 7.348 trillion Reals equivalent to 1.363 trillion US dollars Brazil is the 83rd country in the world in terms of GDP per capita with an income of US$6,450 per person Brazil is a country rich in natural resources At the start of the new century , Brazil experienced an economic boom that lasted until 2014 The boom lifted 29 million people out of poverty and narrowed the inequality gap between the poorest and richest , income increased by about 4.4% for the population as a whole (World Bank, 2016) But this boom, interpreted as a "growth miracle", has put Brazil on the list of BRIC countries; Brazil, the Russian Federation, India and China, first identified by Jim O'Neill of Goldman Sachs in 2001 and then again in 2003, as the four countries expected to grow the fastest and become an important opportunity to expand abroad However, after 2014, the situation reversed and Brazil once again fell into a deep recession, with growth slowing, inflation rising and unemployment rising Part of the economic crisis stems from a drop in the global price of raw materials, to which Brazil is vulnerable due to its status as an exporter of raw materials The economic crisis was closely intertwined with the deepening political crisis in early 2016 At the time, incumbent President Dilma Rousseff was accused of covering up the budget deficit by borrowing from state-owned banks and therefore not through congress the deficit This political crisis has left the government paralyzed and incapable of taking concrete action to get out of the economic crisis In addition to the economic downturn and political turmoil, a major corruption scandal involving Brazilian state oil company Petrobras and several construction companies has been exposed, eroding trust and creating many more political instability During this time, a new downward trend has been noticed in the Brazilian economy, where the inflation rate is once again increasing while the GDP growth rate is decreasing However, the topic of this exercise will not be about Brazil's economic slowdown, but instead will focus on Brazil's period of explosive economic growth from 20 to 2014 Learn about the regulatory policies, Brazil's outstanding advantages in attracting FDI from abroad, which played a big role in Brazil's miraculous growth Bài tập học phần Kinh tế Quốc tế 2.1 GVHD: PGS TS Nguyễn Thường Lạng Research objectives and tasks Target On the basis of actual analysis, assessing the advantages and limitations of Brazil's FDI attraction policy, thereby drawing experience and practical lessons in the policy of attracting FDI capital from abroad of Vietnam 2.2 Mission To achieve the above research purpose, the study will perform the following research tasks: First, introduce the economic achievements of Brazil in the period 2010-2014 Second, analyze the advantages in natural conditions, Brazil's policies in attracting FDI from abroad Third, draw experiences and practical lessons and make recommendations in Vietnam's policies to attract FDI from abroad Object and scope of the study 3.1 Object: Brazil's FDI attraction policy 3.2 Scope: FDI inflows into Brazil and orientation for Vietnam's FDI attraction policy Research Methods The thesis uses the method of analysis, synthesis, comparison to solve the posed problem The data is collected from documents and documents belonging to a number of individuals and international organizations in the world Structure of the topic In addition to the introduction, the end, the table of contents, the list of references, the topic is presented in chapters: Chapter 1: Theoretical basis of FDI capital Chapter 2: Brazil's outstanding achievements in attracting FDI Analyze the characteristics, conditions and policies of Brazil in attracting foreign capital Document continues below Discover more from: Kinh tế quốc tế TMKQ11 Đại học Kinh tế Quốc dân 999+ documents Go to course Kinh tế quốc tế - dịch chuyển quốc tế vốn 30 Kinh tế quốc tế Chính sách tỷ giá hối đoái Việt Nam từ năm 2011 đến Kinh tế quốc tế 26 100% (6) Trình bày phân tích phương thức tốn tín dụng chứng từ ngân hàng thương mại Việt Nam Kinh tế quốc tế 100 100% (7) 92% (13) THÚC ĐẨY PHỤC HỒI KINH TẾ VÀ CẢI CÁCH THỂ CHẾ SAU ĐẠI DỊCH COVID-19: ĐỀ XUẤT CHO VIỆT NAM Kinh tế quốc tế 100% (5) Chiến lược thâm nhập thị trường Việt nam Honda 17 Kinh tế quốc tế 100% (5) Cac dang bai tap mon kinh te quoc te thi cuối kỳ Kinh tế quốc tế tế Quốc tế tập học phần Kinh Bài 100% (5) GVHD: PGS TS Nguyễn Thường Lạng Chapter 3: Experiences and practical lessons that Vietnam has learned from Brazil's FDI attraction policies, thereby making recommendations for Vietnam's FDI attraction policies Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Chapter 1: Theoretical basis of FDI capital 1.1 Theory of FDI Important characteristics of FDI capital Brief statistics and movements of FDI in recent times 1.1.1 Foreign Direct Investment (FDI) In search of economic advantage and productivity enhancement, offshore investment is becoming more and more popular among MNEs There are two types of investments that can be made internationally: Portfolio Investment and Foreign Direct Investment Portfolio investments refer to investments in foreign stocks, bonds or assets without the intention of controlling them The second type of international investment, and one of the concerns of this thesis, is called Foreign Direct Investment (FDI) FDI refers to the investment or acquisition of property in another country for the purpose of controlling it This can be done in a variety of ways; buy property or equipment from a foreign company or enter into cooperation with local companies, known as joint ventures Alternatively, a company can what is known as green FDI by simply building a local base from scratch Typically, FDI is part of a long-term strategic plan in which a company seeks to increase output or access markets Foreign direct investment has the potential to bring many positive economic effects to both the "host" and "home" economies, such as creating long-term cooperation between economies, improving competitive position and open up new markets for investors, a fact that is especially true for developing and emerging markets the past few decades , the world has seen a rapid increase in FDI and although most FDI moves between developed countries, a large part of FDI flows into developing countries a very important factor in the global economy For emerging markets FDI is particularly important for economic development, as it facilitates the exchange of skills and technology and provides access to international markets Because of the possible benefits of FDI, developing and emerging markets take actions to become more attractive to FDI 1.1.2 The role of FDI capital For all social interactions, everything has two sides Of course, FDI capital is no exception, it brings both positive and negative effects to both the Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng investing country and the receiving country Here, based on the context of learning how to attract FDI, we will only consider the effects of FDI on the host country 1.1.2.1 Positive role Firstly, FDI adds capital to the economy: FDI not only adds capital for development investment but also is a more stable capital flow than other international investment flows, because FDI is based on a long-term perspective limited on the market, on growth prospects and does not create debt for the host country's government, so it is less inclined to change in adverse circumstances Second, FDI provides new technology for development: It can be said that technology is the decisive factor for the growth and development of every country, for developing countries, this role is even more important clearly confirmed Therefore, enhancing technological capabilities is always one of the top priority development goals of every country However, to realize this goal requires not only a lot of capital but also a certain level of development of science and technology Third , FDI helps to develop human resources and create jobs: Human resource development and job creation are important factors in promoting economic growth The objective of foreign investors is to obtain maximum profits, strengthen their foothold and maintain a competitive position in the world market Therefore, they are particularly interested in taking advantage of cheap labor in host countries The number of direct workers in FDI enterprises is increasing rapidly in developing countries In addition, the activities of providing services and outsourcing for FDI projects also create more job opportunities In fact, in developing countries, labor-intensive FDI projects train many young women This not only brings them the benefit of high income, but also makes an important contribution to the cause of women's liberation in these countries Fouth, FDI helps to expand markets and promote exports: Export is an important factor of growth Thanks to the promotion of exports, the comparative advantages of factors of production in the host country are exploited more effectively in the international division of labor Developing countries, although capable of producing at competitive costs, still find it difficult to penetrate international markets Therefore, Bài tập học phần Kinh tế Quốc tế 2.2 GVHD: PGS TS Nguyễn Thường Lạng Conditions and policies of Brazil in attracting FDI Based on the characteristics of incentives and factors to attract FDI, Brazil proved to be a promising country for other countries to invest in 2.2.1 Market size According to the literature, market size or market opportunity as measured by GDP per capita is one of the stronger determinants of FDI It is clear that the large market has a positive effect on FDI inflows for foreign companies that engage in horizontal or market-seeking FDI because a large market yields a larger consumer base GDP Per Capita Current US$ $14,000.00 $12,000.00 $10,000.00 $8,000.00 $6,000.00 $4,000.00 $2,000.00 $2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Axis Title Year GDP per capita in Brazil has grown rapidly over the past decades From $5,144 in 1996 and the government trying to clean up their underperforming economy, to $11,728 in 2014 The most significant increase can be seen from 2002 to 2021 when GDP averages per capita more than quadrupled to reach a maximum of $13,039 in 2011 After peaking in 2011, GDP per capita declined slightly for the first time, indicating a declining standard of living This is due to the economic and political crisis among other factors Furthermore, one can also perceive the great social disparities that exist in Brazil, where wealth is unevenly distributed between regions and individuals Although living standards have increased, the annual growth rate of GDP per capita has been quite volatile since 1996 with a peak of 6.5% in 2010 16 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Some studies also measure market size with population or population growth as a proxy The Brazilian market is large: population is 211 million in 2021, making Brazil the 6th most populous country in the world after China, India, the United States, Indonesia and Pakistan 2.2.2 The stability of the economy Brazil has been a subject of interest in macroeconomic studies for several decades In the 70s, the country experienced a boom and was expected by some to grow to become the world's next economic power During this period, the country experienced a high annual growth rate However, in the early 80's, the economy was rocked by a debt crisis that resulted in reduced growth rates and sometimes negative growth During the 1980s, the Brazilian economy experienced a severe recession due to a severe debt crisis, which resulted in unstable and sometimes negative growth rates in the 80s and 90s In 1996, the dong New Real money was introduced and the economy improved, although affected by the economic crisis of 2008-2009 when the growth rate fell along with the rate of many other countries at the time GDP GROWTH (ANNUAL%) 10.00 8.00 6.00 4.00 2.00 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 19 19 19 19 19 19 19 19 19 19 19 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 (2.00) (4.00) (6.00) Year 2.2.3 Labor costs and productivity 17 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Brazil's average salary was 1,982 BRL in 2016 The salary of highly skilled workers was 4,100 BRL, production workers earned an average of 2,010 BRL and low skilled workers were 1,200 BRL per month In recent years, wages have risen and inequality between income groups has decreased Wages are also higher in metropolitan areas such as São Paulo and Rio De Janeiro As labor costs are an important factor in both the resources and markets for which FDI is sought, it is perhaps more important that in labor-intensive industries such as manufacturing, the host country compared to other countries How different is the labor cost is very important A report conducted by the Boston consulting group compared manufacturing costs in the world's top 25 exporting countries in 2004 versus 2014 The study compared 25 countries in terms of labor costs, costs, and costs electricity and production costs natural gas as well as the exchange rate against the US dollar Brazil has shown a strong increase during this period, from one of the lower cost countries in 2004 to one of the more expensive in 2014 2.2.4 Business environment Brazil's business environment is known to be quite good for foreign investors as the government in general does not make any distinction between Brazilian and foreign companies in terms of rules and regulations Some industries are regulated for foreign investors such as healthcare, mass media, telecommunications, maritime, aerospace and air transport On the other hand, there are sectors that are sought after and encouraged for investment such as automotive, renewable energy, life sciences, oil and gas and transportation infrastructure In these cases, there are more favorable conditions for investment as it will spur innovation and hopefully spur growth For example, the average cost of opening a business in Brazil is quite low However, there are aspects that act as barriers when opening and operating a business in Brazil For example, the time it takes to open a new business can be seen as a barrier: the process takes 80 days on average in Brazil (the world average is 21 days) 2.2.5 Tax preferences There are incentives that the government in Brazil offers to foreign investors in the country These incentives depend on the location and industry of the 18 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng investment For example, the Manaus free trade zone, incentives for infrastructure projects, the oil and gas industry and the auto industry Incentives from the municipal level exist in the form of value-added tax and service tax incentives in the energy, logistics and transportation sectors Although there are tax incentives depending on location and industry, there are no special federal incentives to attract foreign investment and domestic and foreign investors are treated equally Tax incentives exist that must be approved by the government agency, promoting projects contribute to the development of an area or the diversification of an industry Brazil has negotiated tax agreements with a number of countries, including Sweden, since 1975 These tax agreements serve the goal of reducing corporate and individual income taxes from double taxation This by stating that income generated in Brazil is subject to Brazilian income tax only Chapter 3: Experiences and practical lessons that Vietnam has learned from Brazil's conditions for attracting FDI 3.1 Current situation of FDI inflows into Vietnam According to information from the Foreign Investment Department, Ministry of Planning and Investment, as of September 20, 2022, the total newly registered capital, adjusted and contributed capital to buy shares, buy contributed capital of foreign investors foreign market reached more than 18.7 billion USD, equaling 84.7% over the same period in 2021 and down 3% compared to August 19 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Specifically, 1,355 new projects were granted investment registration certificates (up 11.8% over the same period); There were 769 times of projects registered to adjust their investment capital (up 13.4% over the same period), the total additional registered capital reached over US$8.3 billion (up 29.9% over the same period) In addition, foreign investors have invested in 18 industries out of a total of 21 national economic sectors The processing and manufacturing industry continued to lead with a total investment of over 12.1 billion USD, accounting for 64.6% of the total registered investment capital The real estate business ranked second with a total investment capital of over 3.5 billion USD Next are the fields of professional science and technology, wholesale and retail In terms of the number of new projects, the wholesale and retail sectors, the manufacturing and processing industries and professional science and technology activities attracted the most projects, accounting for 30%, 25.7% and 15 percent, respectively .9% of total projects According to the Foreign Investment Agency, there were 97 countries and territories investing in Vietnam in the first months of 2022 In which, Singapore led with a total investment capital of over 4.75 billion USD, accounting for 25 3% of total investment capital in Vietnam Korea ranked 20 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng second with over 3.8 billion USD Japan ranked third with a total registered investment capital of over $1.9 billion Foreign investors have invested in 53 provinces and cities across the country in the first nine months of 2022 Ho Chi Minh City leads, Binh Duong ranks second, Bac Ninh ranks third 3.2 Current conditions and policies to attract FDI in Vietnam 3.2.1 Market size Vietnam is a developing country with the highest GDP growth rate in the region and in the world According to data from the General Statistics Office, Vietnam's average GDP growth in the period 2011-2020 is 5.96% In 2020, although the economy was heavily affected by the Covid-19 epidemic, Vietnam's GDP still grew by 2.91%, reaching $ 271.2 billion , while many other countries are seeing an increase negative GDP growth $4,000.00 $3,500.00 $3,000.00 $2,500.00 $2,000.00 $1,500.00 $1,000.00 $500.00 $2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 With a total population of nearly 100 million people and a GDP per capita of about 3,700 USD/person in 2021 (World Bank, 2022), Vietnam is becoming a large and potential consumer market for consumer goods foreign As a country with a young population (about 55.5% of the population under the age of 35), the consumption needs of Vietnamese people are also quite diverse and quickly grasp new and modern consumption trends 21 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng 3.2.2 The stability of the macro-economy Vietnam is really one of the countries with the most stable macroeconomics in the world For example, at a time when the Covid-19 epidemic has had a heavy impact on the entire society of many countries around the world, Vietnam is still one of the few countries with positive GDP growth rates and many achievements previous achievements Specifically, the macro-economy continues to be stable; core inflation in 12 months increased by 0.81%; the average consumer price index (CPI) for the whole year increased by 1.84% over the previous year, the lowest increase since 2016; major balances are secured; gross domestic product (GDP) from negative growth of 6.02% in the third quarter of 2021 (the deepest decline since Vietnam calculated and announced quarterly GDP to date) has reversed impressively in the fourth quarter, increase GDP in 2021 by 2.58%; total export and import turnover of goods increased by 22.6%, reaching 668.5 billion USD - the highest level ever, putting Vietnam in the top 20 countries in the world in terms of international trade; the stock market developed rapidly, the capitalization scale increased by 44.7% compared to the end of 2020; trade surplus is estimated at billion USD; Vietnam ranks in the top 10 global logistics markets; agriculture continues to affirm its supporting role of the economy; despite the pandemic, many large and multinational corporations continue to trust and invest in Vietnam; total foreign investment capital registered in Vietnam as of December 20, 2021, including newly registered capital, adjusted registered capital and value of capital contribution and share purchase by foreign investors reached 31 15 billion USD, up 9.2% compared to 2020; There were 985 turns of projects licensed from previous years registered to adjust investment capital, increasing by US$ 9.01 billion , up 40.5% over the previous year 3.2.3 Commercial expansion According to a report by market researcher Fitch, Vietnam ranks 5th out of 35 Asian countries in terms of economic openness “Vietnam is emerging as an important manufacturing hub in East and Southeast Asia, supported by government-led economic liberalization efforts and integration into global supply chains, through trade agreements and membership of regional and international blocs," commented Fitch Solutions 22 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng According to Fitch Solutions' Vietnam Trade and Investment Risks report for the third quarter of this year, Vietnam scored 74.6 out of 100 in terms of economic openness, higher than the Asian average of 46 and the average globally is 49.5 points Vietnam's economic openness compared to the region and the world 80 74.6 70 61.1 60 58.9 59.3 50 50 46 49.5 49.6 40 30 20 10 Viet Nam East and Southeast Asia Economic openness Asia World Column1 Regarding trade and investment risks, Vietnam was scored 61.1 points, higher than the average in Asia and the world With this criterion, the lower the score, the higher the risk Vietnam ranks 9th regionally and 57th globally in terms of trade and investment risks Vietnam is also a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and various free trade agreements The report assesses this as further supporting economic and trade diversification efforts 3.2.4 Infrastructure Investment in public infrastructure has been one of the important drivers of Vietnam's economic development in recent decades 53% of the total Official Development Assistance (ODA) received between 2010-2017 was used for infrastructure construction Vietnam has focused on investing in the development of transportation, especially the system of roads, airports and seaports Investment from the public and private sectors in infrastructure in Vietnam has reached 5.7% of GDP in recent years, the highest in Southeast 23 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Asia and the second highest in Asia, just behind China (6) .8% GDP) The promotion of infrastructure development on the one hand meets the requirements of investment projects; on the other hand, helping to boost economic growth and create more jobs Moreover, the rapid urbanization in Vietnam is also a strong driving force for the development of transport and utilities It is estimated that with 50% of the population currently living in major cities, population growth has exceeded the capacity of existing connectivity and utility systems Recently, the Government of Vietnam approved a plan to spend 43-65 billion USD to build and upgrade road, railway, inland waterway, sea and air transport infrastructure in the country period 2021-2030 The government has also issued a new Public-Private Partnership (PPP) Law, effective from March 29, 2021, to support and regulate private investment to scale up infrastructure upgrades, especially in the fields of transport, grid power and power plants The move is intended to attract more private investment to reduce the burden on the nation's public debt and fiscal policy According to the 2019 Global Competitiveness Report of the World Economic Forum, Vietnam ranked 77/141 in terms of overall infrastructure quality, 66th in transport infrastructure and 87th in terms of infrastructure utility infrastructure 24 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng 3.2.5 Tax incentives Over the past time, Vietnam has continuously improved its financial institutions and preferential policies to attract and better manage foreign investment resources The Government has issued many documents and policies to attract and manage FDI in Vietnam, such as the Law on Investment, the Law on Corporate Income Tax (CIT), the Law on Import and Export Tax, and the Law on History non-agricultural land use along with guiding documents on mechanisms and policies to encourage FDI enterprises to invest in Vietnam The preferential policies mainly focus on the following areas: Firstly, creating a legal framework to ensure foreign direct investment activities: Policies related to FDI enterprises all create favorable conditions for foreign investors, there is no discrimination between investors domestic investment with foreign investors The Investment Law specifically stipulates 13 groups of fields and types of priority areas for investment; clearly 25 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng stipulate conditions, procedures, business registration process as well as forms of investment and implementation of investment projects Second, tax incentives for enterprises: the Law on CIT and guiding documents specifying levels of tax exemption and reduction incentives for all types of enterprises; abolish the provisions on additional CIT; abolish regulations on tax on remittance of profits abroad The annual tariff reduction in accordance with regional and international commitments for raw materials also helps enterprises, including FDI enterprises, to significantly reduce a part of input costs and improve competitiveness price for the product Thirdly, preferential policies for land and ground use: The Land Law and its guiding documents agree on the viewpoint of eliminating the distinction between different types of enterprises in the opportunity to access and use land and fulfill financial obligations for land use activities 3.3 Experiences and practical lessons that Vietnam has learned from Brazil's FDI attraction activities From the experience of Brazil, Vietnam can draw valuable lessons as follows: Firstly , promote the initiative and uphold the dialogue perspective of the organizational system to ensure the interests of stakeholders in attracting FDI into industrial development Second , develop appropriate policies to attract foreign investment according to each stage of national development to ensure that these resources serve the development of domestic production Promote the attraction of high-tech investment projects, grant special investment incentives for these types of projects Third , in terms of investment procedures, foreign investors implementing investment projects must carry out investment procedures with a strict process, with the participation of licensing and appraisal of many specialized ministries Fourth , maintain and develop FDI capital evenly across regions and effectively decentralize management Fifth , attracting FDI into priority areas according to different development stages of the economy Vietnam can actively pursue the policy of building industrial clusters and special economic zones with legal institutions that go beyond the unified national institution to create conditions for foreign investors to develop 26 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Sixth , Vietnam needs drastic reform in the quality of human resource training: labor costs are not high, but the region's minimum wage changes continuously, which causes concern for investors Seventh , there is an investment promotion mechanism, close coordination between the Ministry of Planning and Investment and the provincial Departments of Planning and Investment Eighth , Vietnam needs to attach importance to sustainable development and attract FDI in the context of implementing FTAs, according to which it is necessary to remove non-tariff measures applied to trade and investment in energy production replicated experience from Brazil 3.4 The achievements in trade and investment that Brazil and Vietnam have achieved in recent years Areas in Vietnam that Brazil invests mainly Over the years, the two sides have been actively cooperating in many fields such as politics, economy, military and culture The two countries have always supported each other, served socio - economic development in each country, and coordinated closely at international organizations and multilateral forums The bright spot in Vietnam and Brazil relations is economic-trade Trade between the two countries has consistently maintained continuous growth in recent years, reaching more than USD billion in 2021 and in 10 months of 2022 has reached USD 5.5 billion up 16% over the same period last year In particular, priority areas of investment, researched by Deputy Prime Minister oriented Brazilian enterprises include: manufacturing industry, high technology, infrastructure development, agro - forestry - fisheries, renewable energy, information technology, pharmaceutical, biological, construction, services as well as joining strategic partners in the state-owned enterprises of Vietnam has been and will equitize and divest Specifically, exchanging with many corporations, businesses Brazil's leading industry federation (FIESP) (the organization representing 133 major leagues with more than 13,000 member companies); Embraer group specializing in aviation, defense and security industries; Eurofarma Pharmaceutical Group; Brazilian fisheries Promotion Association The two sides also mentioned specific contents, such as: FIESP as a focal point in cooperation with Vietnamese ministries, sectors and economic organizations 27 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng to promote and promote trade and investment cooperation between the two countries in the coming time Welcome Embraer to work, contact with Vietnamese partners on the provision of aircraft; sharing experience; technical transfer Coordinate, support the Abipesca Association in sharing experience in the field of Fisheries, fishing, especially in the issue of offshore fishing, preserving frozen fish In addition to agreeing with the opinion of the Vietnamese side; Brazilian corporations and enterprises expect to achieve investment efficiency when implementing the project in Vietnam with the commitment to research investment and business in the Vietnamese market Conclusion Attracting FDI from abroad is always one of the important topics that the Party and leaders of Vietnam pay attention to Chapter one presents a theoretical overview of FDI The roles and factors play an important role in attracting FDI to the host country Chapter two presented outstanding achievements of Brazil in attracting FDI capital from abroad Present the characteristics, economic conditions, society, policies of Brazil in attracting foreign capital Chapter three mentioned the situation of attracting FDI capital of Vietnam, analyzed the economic, social and policy factors of Vietnam compared to Brazil From there, make recommendations and recommendations to promote attracting FDI in Vietnam One of the important factors that helps a country to exploit FDI is investment in industry and services The host country needs to achieve a minimum level of high-quality labor to be able to both attract quality FDI inflows and thereby maximize the increase in source value labor in the presence of FDI inflows Statistics show that from 2005 onwards, Brazil has made strong investment in science and technology and the investment value is increasingly narrow compared to other developed countries and is now only lower than that of other developed countries several countries in the world Meanwhile, countries that receive a lot of FDI inflows but without the right strategy will easily fall into the situation of outsourcing, which has the lowest 28 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng value in the global production chain For these outsourcing countries , FDI flows only focus on exploiting natural resources and cheap labor The localization rate of FDI enterprises will be very low when almost domestic supporting industries not have enough technological capacity to coordinate production with FDI enterprises The majority of raw materials and production components will be imported from abroad, which can create pressures on the country's current account So Vietnam not only has to figure out how to attract capital, but also has to pose a problem to use that investment capital properly List of references Các kinh tế hút đầu tư https://www.mpi.gov.vn/en/Pages/tinbai.aspx?idTin=12096&idcm=138 Nguồn vốn vào Brazil giảm mạnh https://bnews.vn/nguon-von-fdi-vao- brazil-giam-manh/204918.html Brazil – Ngôi sáng đồ FDI Mỹ- Latinh https://baotintuc.vn/kinh-te/brazil-ngoi-sao-sang-tren-ban-do-fdi-o-mylatinh-20121128094032602.htm Giám đốc quốc gia ADB: Dòng vốn FDI phiếu tín nhiệm với Việt Nam https://vneconomy.vn/giam-doc-quoc-gia-adb-dong-von-fdila-mot-la-phieu-tin-nhiem-voi-viet-nam.htm Dự báo dịng vốn FDI có chất lượng “đổ” vào Việt Nam https://www.vietnamplus.vn/du-bao-dong-von-fdi-co-chat-luong-honse-do-vao-viet-nam/820699.vnp Thế giới dự báo kinh tế Việt Nam: Điểm sáng năm 2023 https://tuoitre.vn/the-gioi-du-bao-kinh-te-viet-nam-diem-sang-nam2023-20221219073716459.htm Bộ trưởng Nguyễn Chí Dũng: Cần tập trung nhóm nhiệm vụ định hướng kinh tế 2023 https://vneconomy.vn/bo-truong-nguyen-chi-dungcan-tap-trung-8-nhom-nhiem-vu-va-dinh-huong-dieu-hanh-kinh-tenam-2023.htm Kinh tế Việt Nam 2023: Ổn định kinh tế vĩ mô, bảo đảm cân đối lớn, vững vàng vượt qua thách thức https://vccinews.vn/news/45492/kinh-te-viet-nam-2023-on-dinh-kinhte-vi-mo-bao-dam-cac-can-doi-lon-vung-vang-vuot-qua-thachthuc.html 29 Bài tập học phần Kinh tế Quốc tế GVHD: PGS TS Nguyễn Thường Lạng Sổ tay doanh nghiệp: Tận dụng EVFTA để xuất nhập hàng hóa Việt Nam Đức https://trungtamwto.vn/an-pham/19607-so-taydoanh-nghiep-tan-dung-evfta-de-xuat-nhap-khau-hang-hoa-giua-vietnam-va-duc 10 Quy mơ thị trường Việt Nam https://trungtamwto.vn/thi-truongduc/19550-quy-mo-thi-truong-viet-nam 11 Fitch Solutions: Việt Nam đứng thứ Châu Á độ mở kinh tế https://vnexpress.net/fitch-solutions-viet-nam-dung-thu-5-chau-a-vedo-mo-kinh-te-4503010.html 12 Foreign investment in Brazil reached its highest value in almost two years https://www.gov.br/en/government-of-brazil/latestnews/foreign-investment-in-brazil-reached-its-highest-value-inalmost-two-years#:~:text=04%3A40%20PM-,Foreign %20investment%20in%20Brazil%20reached%20its%20highest %20value%20in%20almost,in%20the%20last%2011%20years 13 Brazil: Foreign Investment https://santandertrade.com/en/portal/establish-overseas/brazil/foreigninvestment 14 Foreign Direct Investment (FDI) in Brazil https://www.lloydsbanktrade.com/en/marketpotential/brazil/investment 15 Foreign Direct Investment on Brazilian Economy https://www.ukessays.com/essays/economics/impact-of-foreign-directinvestment-on-brazilian-economy-economics-essay.php 16 Brazil Foreign Direct Investment https://tradingeconomics.com/brazil/foreign-direct-investment 17 Brazil Foreign Direct Investment 1970 – 2022 https://www.macrotrends.net/countries/BRA/brazil/foreign-directinvestment 18 Foreign Investment in Brazil at 10 year high https://www.clbrief.com/foreign-investment-in-brazil-at-10-year-high/ 19 Brazil – Gross domestic product in current prices https://knoema.com/atlas/Brazil/GDP#:~:text=Though%20Brazil %20GDP%20fluctuated%20substantially,by%20our%20digital%20data %20assistant 30