In only about 3 months (from December 2019 to the present), the world and especially China have suffered from the terrible devastation and attacks of the nCoV virus (nCoV). The influence of nCoV has been not only upon human life and health but also strongly extended to the world economy; Chinese FDI enterprises in Vietnam are no exception. In this article, Bizlawyer will present some typical nCoV’s impacts on Chinese FDI enterprises in Vietnam.

Firstly, the trade has been restricted.

On January 31, 2020, the Prime Minister issued Directive No. 06/CT-TTg which puts a temporary ban on any entry and exit of on-foot travelers across the borders and discourages trade between Vietnam and China.

According to this regulation, import and export activities between China and Vietnam are limited and strictly controlled.

There are stagnations in import activities from China: Chinese FDI enterprises are unable to bring facilities, technical equipment, modern technology, and input materials from China to Vietnam for serving production and business activities, especially in the garment, electronics, healthcare, and dentistry industries. Meanwhile, the Vietnamese market is unable to address this demand itself. Meanwhile, the Vietnamese market is unable to address these demands itself.

There are also stagnations in export activities from Vietnam to China which were previously considered as an advantage of Chinese FDI enterprises in Vietnam, are now being limited

Secondly, the immigration of investors and workers from China are strictly restricted and controlled.

According to Directive No. 06/CT-TTg, the Prime Minister requests:

• Temporarily suspend flight permits for all flights from Chinese epidemic areas to Vietnam and vice versa, except for special cases where the consent of the Prime Minister is required.
• Temporarily suspend issuing tourist visas for foreigners (including Chinese tourists) who have been in China for the past 2 weeks, except for the visa duty in special cases.
• Suspend the exit and entry through border travel certificates for tourism purposes.
• Prohibit traveling through the trails in the Vietnam – China border area.
• Strictly control passersby at all border gates; Suspend tourist transportation activities; prohibit sending Vietnamese workers to China for working.
• Strictly monitor Chinese citizens, workers used to work in Vietnam are coming back to Vietnam after Tet holiday; Strictly monitor the suspected cases of being infected within 14 days; promptly isolate, monitor and treat the suspected cases of being infected;
• Sterilize the suspected epidemic spots according to regulations.

Chinese FDI enterprises often employ large numbers of Chinese workers and experts. The restriction on entry and exit between the two countries right after the Tet holiday leads to a labor shortage to operate the plants. Besides, the operation and management of Chinese investors also are cut

Thirdly, there is an apprehension of people, state agencies, partners, customers in Vietnam over Chinese FDI enterprises.

In the context that the disease outbreak is still unpredictable, there are many recommendations about nCoV on mass media making most people, state agencies, partners, and customers in Vietnam be very afraid of, or minimize and even refuse to contact with Chinese FDI enterprises. Consequently, the exchange and market expansion activities of Chinese FDI enterprises are also significantly affected

Conclusion

To conclude, there are three typical impacts of nCov on Chinese FDI enterprises in Vietnam. Hopefully, this article has provided you with useful information. Bizlawyer is a provider of legal services for foreign investors, especially Chinese investors in Vietnam. If you are interested, please contact us directly via our email: Info@bizlawyer.vn or Hotline Call: (+84)86.888.1900 for timely advice and support.