Support and incentives to be provided to startups under new Decree.
Vietnam’s startup community will now have easier access to funding following the release of Decree No. 118/2015/ND-CP, providing guidance on the implementation of certain articles of the Law on Investment, in which the government has expanded the list of prioritized investment fields.
The government said it will provide support and incentives to investment projects involved in high-tech nursery, biotechnology development, information technology software manufacturing, and recycling and clean energy production.
The announcement has excited some in the domestic startup community. “This is a positive development and I’m very optimistic about Vietnam’s startup ecosystem,” Founder of taembe.com, Mr. Phan Kim Don, said. “I think the current startup situation is picking up and will develop sharply after this decree.”
According to the CEO of Emotiv System, the Decree will create the conditions for investors to deploy plans and business operations. It provides a legal framework facilitating investment with incentives in infrastructure, production areas, and operations as well as taxes, which are issues for startups in Vietnam. He added that it opens up the prospects for Vietnam’s software technology development in line with today’s global trends, such as big data.
Vietnam’s startup community has held meetings with Deputy Prime Minister Vu Duc Dam at the Office of the Government, where many said there was inadequate government support, including a lack of tax incentives for internet-based service providers, while barriers in receiving foreign capital remained significant.
While startups contacted by VET were aware of the Decree they were still largely in the dark. “I’ve heard about it but haven’t researched it fully, and I think we need clearer instructions to help us access the incentives,” a representative from a software manufacturer said.
“The Decree needs to clearly state what benefits businesses can access,” he added. The government, he went on, should assist the startup community to bring ideas to the market and connect with investors and funds, and create a clearer legal framework that guides the community to operate more effectively.