A new decree intended to encourage international investment in science-and-technology (S&T) research will become effective on Wednesday, September 1. A new decree intended to encourage international investment in science-and-technology (S&T) research will become effective on Wednesday, September 1. The Science and Technology Ministry’s Technology Assessment and Inspection Department wrote the decree that will replace all of Viet Nam’s prevailing laws governing international investment and co-operation in science and technology. It will also make the formalisation of any agreements for international co-operation through contracts or memorandum mandatory. One of its major objectives was to persuade international investors to establish S&T research institutes in Viet Nam, said the department’s director Do Hoai Nam.

Investment from organisations and individuals would be sought for basic research in the natural sciences; applied research in information technology; biotechnology; automation and electronic mechanics, nuclear and alternative energies, space science, mechanics; agricultural produce and cooking processing, waste treatment technology; high-technology personnel training and development as well as technology and related services transfer.

Promotion

Money to promote S&T development in Viet Nam would also be sought.

The decree would allow the establishment of entirely foreign-owned S&T enterprises in Viet Nam provided they meet criteria that include qualified personnel and adequate infrastructure for research.

“Foreign investors have favoured several fields that promise a quick return while the benefits from spending on S&T field are often seen as long-term,” said Nam.

Only one entirely foreign-owned enterprise had been confirmed as having dedicated itself to S&T research.

Major maker of semi-conductor systems for mobile phones and automobiles, Japan’s Renesas Electronics Co-operation, had opened a research centre in HCM City’s Tan Thuan Export Processing Zone in 2007.

The centre was dedicated to developing sophisticated multifunction System-on-Chips.

“Viet Nam is well-known for its software outsourcing, but the Renesas approach is different,” said the director.

The achievements harvested from its research in Viet Nam will be repatriated to its headquarters for mass production.”

Prestigious research institutes in developed countries would also be encouraged to open in Viet Nam.

“Although we have no official data about demand, it seems promising,” he said.

“Global corporations are very likely to need research-and-development centres in addition to manufacturing factories.

“We do not expect foreign investors to transfer all of their technology to Viet Nam.

“But we believe that if R&D centres are opened in Viet Nam, their main tasks will be to develop specific components so as to customise their products to suit Viet Nam’s particular conditions,” he said.

Viet Nam’s workers might not be initially proficient, but their intellectual capabilities would quickly flourish with proper training.

The cost of their labour was also cheaper than elsewhere.

Another incentive would be a Finance Ministry-regulated preferential tax regime.

Nam said although international co-operation was thriving, it was voluntary and hence the need for proper management.

Intellectual property needs protection

Nam Hung Law Firm director Nguyen Van Nam warns that Vietnamese workers could suffer if intellectual property rights stemming from the S&T research are not properly managed.

“The participation of different parties in S&T innovation always carried the potential for conflict,” he said.

Viet Nam’s Intellectual Property Law basically accorded with The Agreement on Trade-Related Aspects of Intellectual Property Rights – the minimum requirement for any World Trade Organisation member.

But the opening of S&T research to international investors could raise the question as to what extent the intellectual property a Vietnamese employee created was protected.

The Vietnamese inventor might be granted the patent but the company would have the right to utilise the invention.

“Unless the law is strengthened, it’s very likely the aim of boosting S&T investment will have the reverse effect,” the lawyer said.

Source: VNS