According to the statistics of the Ministry of Planning and Investment, in 11 months of 2018, the total outward investment capital of Vietnam that is newly granted has increased by 357.5 million USD. Laos, Cambodia and Myanmar are ranked 1st, 2nd and 8th respectively in Vietnamese business’ investment destinations. Although direct outward investment brings economic benefits to Vietnam as well as the recipient countries and communities, it also faces potential risks, especially agricultural investment. In addition to traditional risks such as weather, natural disasters, and markets, agricultural investment has been challenged by environmental and social risks due to high demand for land and human resources. It becomes even more apparent when most of Vietnam's agricultural investment projects abroad focus on countries such as Laos, Cambodia, and Myanmar, where land registration and management system have not yet been completed and labor practices have not been thoroughly formed.
Photo: CPV
The conference launches the “Voluntary guidelines on Mitigating socio – environmental risks for Vietnamese outward investors in agriculture in the Mekong sub-region”, the first of its kind. The guidelines were developed in a “bottom-up” approach, on the bases of the UN Guiding Principles on Business and Human Rights, field research results and lessons learned from practical outward investments of Vietnamese enterprises in Laos and Cambodia who are members of the Pioneer Business Group consisting of six leading Vietnamese enterprises and two associations in agricultural outward investment.
Mr. Dau Anh Tuan, Head of Legal Department, VCCI said: “We developed the Guidelines to provide an overview of the outward investment procedure from Vietnam to the host countries with potential social and environmental risks in investment steps in terms of relevant policies and legislation. This Guidelines will help investors minimize the risks and access to useful information and contacts to help the parties easily connect and find information to improve investment efficiency”.
The Guidelines has been piloted by the Vietnam Rubber Group and DakLak Rubber Company who were supported to review their policies and practices and to develop a strategic pathway to increase their interactions and participation with local communities in Laos and Cambodia.
According to Mr. Trinh Le Nguyen, Director of PanNature, “The Guidelines were developed based on the study of Vietnam investment in the Mekong subregion, especially in Laos and Cambodia, examples or references are particularly focused on these countries. The Guidelines are mainly applied for Vietnamese businesses with investment activities in agriculture in Mekong Subregion countries, but the Guidelines’ authors also referenced international experiments and documents, especially the UN Guiding Principles on Business and Human Rights, so it may still be a valued reference in other countries if suitable”.
The conference also hosts a panel with participation from the Vietnamese Ambassador to Cambodia, Vietnamese investors, government representatives and lawyers to discuss opportunities and risks in agricultural investments in Mekong Region.
This is an activity of the “Vietnamese Cross-border Agricultural Investment in the Mekong Sub-Region” project implemented by VCCI, Oxfam in Vietnam and PanNature started in 2015.
Ms. Babeth Ngoc Han Lefur, Country Director of Oxfam in Vietnam, shared: “An increase in cross-border investments in agriculture in the Mekong Region has impacted on the life of local people, both positively and negatively. The investments have created new jobs for local people but also taken away traditional livelihoods of local people without sufficient and comprehensive solutions to compensate and support local people to create new and sustainable livelihood in their home land. Many social and environmental risks of those investments have not been properly mitigated, leading to negative impacts to local life and society as well as to the sustainability of those businesses. That fact triggers the joint efforts of Oxfam, VCCI and PanNature to promote principles and good practices for responsible agricultural investment in the Mekong Region, aiming to secure life and sustainable livelihood for local people”.
The conference witnesses participation and sharing from business representatives, policy makers, NGOs, international organizations in Vietnam, Laos, Cambodia, and China./.