Interviews
Human resource quality: Factor to attract foreign capital, VCCI
04 Aug '08
6 min read
The very rapid development of the insurance sector scaled up the demand for labour. The report showed that improvement in the quality of labour was an urgent requirement to ensure the development of new insurance products and services and the sustainable development of the insurance market.
Human resource quality: Factor to attract foreign capital
Mr Pham Quang Ngoc from VCCI said that during the 2004-2007 period the expanding presence of foreign investors in Vietnam.
Although pledged foreign capital has increased strongly in recent years, these results came from the increased trust of foreign investors in Vietnam.
&ldquoFDI capital disbursement showed worrying signals for Vietnams ability to attract capital. The divide between pledged capital and disbursed capital was getting wider and wider.
The growth rate of FDI capital disbursement is thus much lower than that of pledged FDI capital. The disbursement growth was 8 per cent in 2004), 16 per cent in 2005 and 20 per cent in 2006,&rdquo Ngoc said.
One of the important reasons for the weak absorption of FDI capital is the quality of human resources in Vietnam. Most FDI capital is injected into production, real estate development and service sectors like banking, insurance and tourism, not much in health and education.
Mr. Ngoc said that foreign garment companies need more labours. The workforce in food companies was also large but the demand would slow down in the coming years.
The construction and tourism sectors seemed unattractive to foreign investors. Thus, most jobs in these sectors were d by private and state-owned enterprises.
If workers in the processing industries are not necessarily well-trained, the training is decisive factor in service sectors like banking. &ldquoThe demand for high quality labour will increase quickly in FDI service companies, especially the banks,&rdquo Ngoc foreed.
Although jobs d by FDI insurance companies reduced significantly, the amount of workers in FDI companies was not smaller than those in private and state-owned enterprises. The demand for high-quality labour will increase in the coming year as FDI firms are needed.
Arguably, financial companies and banks attracted labourers from insurance companies because the former ensured higher incomes for them.
In general, FDI companies require labours of higher quality than state-owned and private enterprises. This made FDI companies difficult to attract desired labourers because those from state-owned and private enterprises are not on their targets.
At present, the labour supply to FDI companies in places where FDI projects are of majority is difficult, especially in labour-intensive sectors (garment and seafood).
Additionally, many workers at FDI companies in Mekong Delta are moving to work for private companies who offer higher working positions while the supplement seems beyond the demand.
With the government&rsquos effort to a business environment attractive to foreign investors, Vietnam is now in the top list of countries with the largest FDI capital. With the current FDI disbursement, foreign companies will not be able to find sui workers if the country cannot train capable workers.
Human resource quality: Factor to attract foreign capital
Mr Pham Quang Ngoc from VCCI said that during the 2004-2007 period the expanding presence of foreign investors in Vietnam.
Although pledged foreign capital has increased strongly in recent years, these results came from the increased trust of foreign investors in Vietnam.
&ldquoFDI capital disbursement showed worrying signals for Vietnams ability to attract capital. The divide between pledged capital and disbursed capital was getting wider and wider.
The growth rate of FDI capital disbursement is thus much lower than that of pledged FDI capital. The disbursement growth was 8 per cent in 2004), 16 per cent in 2005 and 20 per cent in 2006,&rdquo Ngoc said.
One of the important reasons for the weak absorption of FDI capital is the quality of human resources in Vietnam. Most FDI capital is injected into production, real estate development and service sectors like banking, insurance and tourism, not much in health and education.
Mr. Ngoc said that foreign garment companies need more labours. The workforce in food companies was also large but the demand would slow down in the coming years.
The construction and tourism sectors seemed unattractive to foreign investors. Thus, most jobs in these sectors were d by private and state-owned enterprises.
If workers in the processing industries are not necessarily well-trained, the training is decisive factor in service sectors like banking. &ldquoThe demand for high quality labour will increase quickly in FDI service companies, especially the banks,&rdquo Ngoc foreed.
Although jobs d by FDI insurance companies reduced significantly, the amount of workers in FDI companies was not smaller than those in private and state-owned enterprises. The demand for high-quality labour will increase in the coming year as FDI firms are needed.
Arguably, financial companies and banks attracted labourers from insurance companies because the former ensured higher incomes for them.
In general, FDI companies require labours of higher quality than state-owned and private enterprises. This made FDI companies difficult to attract desired labourers because those from state-owned and private enterprises are not on their targets.
At present, the labour supply to FDI companies in places where FDI projects are of majority is difficult, especially in labour-intensive sectors (garment and seafood).
Additionally, many workers at FDI companies in Mekong Delta are moving to work for private companies who offer higher working positions while the supplement seems beyond the demand.
With the government&rsquos effort to a business environment attractive to foreign investors, Vietnam is now in the top list of countries with the largest FDI capital. With the current FDI disbursement, foreign companies will not be able to find sui workers if the country cannot train capable workers.
Vietnam Chamber of Commerce and Industry
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