ad to lie long in inventories. Typical of these weree cement, iron, and steel, garments. New FDI products in Vietnam such as motor cars, motorcycles were also very slow moving, causing substantial difficulties to these enterprises. Competition between domestic and foreign invested enterprises: In 1996, Vietnam imported goods worth over US$ 11 billion, the majority of these being goods that Vietnam could not produce as yet. Therefore, it was the objective of many enterprises with foreign invested capital to produce goods that Vietnam still had to import, something which many Vietnamese had been endeavouring to do. As a result, fierce competition arose between them in the domestic market and over time the sales of good produced by these enterprises were slow, entailing a decrease in FDI.2. Investment environment High price index and dual price system: Vietnam’s cost of living, price of labors, prices of services are too high as compared to other countries in the region. According to statistics of Corporate Resources Group, price index of HCMC (97.8) and Hanoi (96.8) is higher than that of Seoul, Sydney, New Delhi, just lower than Singapore (109,4), London (111.6). In addition, the dual price system makes foreign investors pay higher price, thus this policy considerably topples Vietnam’s competitiveness. Backward infrastructure: our infrastructure system not yet meets the requirements of foreign investors, especially as we compare with infrastructure of neighbor countries such as China, Thailand... Bad services quality: some improvements have been recorded in the quality of investment services, but they are still far from meeting the requirements of investors. Besides, the fee to be paid for investment services is not uniform. Poor qualification of Vietnamese management: In joint ventures, representative for Vietnamese side is primarily state-owned enterprises. Vietnamese officials are po...
