Vietnamese enterprises are being encouraged to tap into business opportunities in Canada as the nation actively calls for foreign investment in the wake of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) officially coming into effect.

 

In the workshop “Business opportunity with Canada through CPTPP” on Friday in HCM City, chairman of Canada Trade Link Bryon Wilfert said Canada wanted to take advantage of CPTPP to promote co-operation through lowering the tax base.

 

Wilfert said businesses from the two countries have a unique opportunity to increase trade and investment with tariffs – the biggest impediment to economic co-operation – being removed.

 

Under the pact, Canada will cut tariffs on 95 per cent of imports from Việt Nam to zero, covering 78 per cent of Việt Nam’s total export revenue to Canada.

 

Canada’s trade with Việt Nam has only strengthened recently with two-way trade turnover reaching US$1.46 billion in the first four months of this year, up 30 per cent year on year. Of the total, Việt Nam exported goods worth $1.18 billion to Canada, up 43.7 per cent.

 

Despite the recent growth, these figures were significantly lower than Việt Nam’s trade turnover with its largest trading partners China, the US, Japan and South Korea.

 

According to Wilfert, the two sides’ export structures complement each other. Through CPTPP, Việt Nam could boost exports in areas of strength such as seafood, wooden products, textiles, footwear and agricultural products.

 

He said Canada wanted to promote co-operation in its strongest areas such as clean energy and technology, waste treatment and water treatment.

 

Canada also hopes to increase investment in infrastructure development projects in Việt Nam and with other ASEAN countries through Việt Nam.

 

Facilitate investment

 

CPTPP was the first free trade agreement between Việt Nam and Canada and it provides an important legal basis for not only trade but also investment activities for enterprises of both countries.

 

According to Vince Lalonde, director of the Immigration-Investor Service of Pace law firm, Vietnamese enterprises can take advantage of the pact and Canada’s preferential foreign investment policy to transition from “passive” to “active” investors in Canada.

 

“Passive investment” is a popular investment scheme in which Vietnamese people invest a sum of money in the Canada and get back the money after five years along with permanent residency for investors and their family.

 

There was no risk involved in this scheme but also no profit, Lalonde said.

 

He said that under CPTPP, Vietnamese investors could be more active and become the owner of an enterprise in Canada by hiring local employees. To lure more foreign investors, the Canadian government has also relaxed the requirement for investors to stay in the country.

 

Now, it is not compulsory for an investor to stay in Canada for 24 months to obtain a residence permit. Family members and employees of the company are also acceptable, Lalonde said

 

However, according to him, Canada is a very large country and each area has different investment conditions, meaning investors need to hire professional firms that understand the local law before deciding to invest to minimise risks. — VNS