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Most of Vietnam's FDI companies use outdated technology

HANOI, May 8 (Xinhua) -- Nearly 85 percent of Vietnamese companies with foreign direct investment (FDI) are reported to use outdated technology which could reduce the country's probability of achieving its stated goals of reaching net-zero emissions by 2050, Vietnam News reported on Monday.

FDI has been a key driver of Vietnam's economic growth as FDI companies account for more than 70 percent of the Southeast Asian country's exports. Vietnam received 8.9 billion U.S. dollars of FDI as of April 20 this year, down 17.9 percent from a year earlier, according to the General Statistics Office.

However, most of the country's FDI companies use old technologies that are already outdated, capital-intensive and have a detrimental impact on the environment.

Only 5 percent of FDI companies have applied high-tech solutions, said Nguyen Van Toan, vice chairman of Vietnam's Association of Foreign Invested Enterprises.

More FDI in green technology and environmental protection-related industries should enhance Vietnam's green transition since FDI companies have financial resources, management experience and modern technologies, said Nguyen Anh Tuan, deputy director of the Foreign Investment Department under the Ministry of Planning and Investment.

Businesses in Vietnam, including foreign-invested firms and local private companies, have invested about 9 billion dollars in green growth projects or 2 percent of the country's GDP as green investments in Vietnam have grown between 10 percent and 13 percent over the past two years, the senior trade official added.

Each year the circular economy generates about 4-5 trillion dollars and creates a lot of new jobs through new business models, according to statistics of the Business Council for Sustainable Development.

Science and technology will help Vietnam achieve the goal of net zero emissions by 2050, said Nguyen Quang Vinh, vice chairman of the Vietnam Chamber of Commerce and Industry, stressing the need to impose zero-carbon high-technology requirements on foreign companies.

As the government is moving to stabilize the macro-economy, reform administrative procedures, and create a foundation for the business community, the business community should be proactive in taking advantage of the incentives offered by the country, said Vinh.

Vietnam's push for green transition will offer unprecedented opportunities for both local businesses and foreign companies in key sectors for low-carbon emissions, said Minister of Planning and Investment Nguyen Chi Dung.