Ảnh hưởng của đầu tư trực tiếp nước ngoài lên thị trường lao động tại các nước ASEAN

Nội dung text: Ảnh hưởng của đầu tư trực tiếp nước ngoài lên thị trường lao động tại các nước ASEAN

1. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 THE EFFECTS OF FDI ON THE LABOR MARKET OF ASEAN COUNTRIES ẢNH HƯỞNG CỦA ĐẦU TƯ TRỰC TIẾP NƯỚC NGOÀI LÊN THỊ TRƯỜNG LAO ĐỘNG TẠI CÁC NƯỚC ASEAN Le Thai Phong, Nguyen Thi Sam Foreign Trade University lethaiphong@ftu.edu.vn ABSTRACT The characteristics of foreign direct investment and labor market have been listed and analyzed carefully. The effects of foreign direct investment (FDI) on the labor market of ASEAN countries are quite mixed and need to be further analyzed by in-depth models. In general, FDI has brought positive impacts on the labor market of ASEAN countries, but these effects are not well adapted due to both subjective and objective reasons. The labor force of ASEAN still faces a lot of difficulties in taking advantage of huge FDI capital from outside. Therefore, some solutions have been proposed to help ASEAN labor force in general and Vietnamese labor in particular get access to this type of investment and gradually raise their capabilities to work abroad. Keywords: FDI, labor market, Asean countries. TÓM TẮT: Bài viết nhằm đánh giá tác động của đầu tư trực tiếp nước ngoài lên thị trường lao động tại các nước ASEAN. Số liệu về FDI và thị trường lao động được lấy từ các nguồn đáng tin cậy của khu vực ASEAN và quốc tế. Kết quả cho thấy FDI có tác động lớn đến thị trường lao động ở nhiều khía cạnh như chi phí lao động, nhu cầu lao động Từ khóa: FDI, thị trường lao động, các nước ASEAN. 1. Research Rationale FDI has played a strategic role in the economic growth of ASEAN and in many other economic cooperation regions around the world. FDI is seen as an important channel for obtaining employment opportunities, human capital development, higher wages, technology transfer, and infrastructure improvement. In other words, FDI is often seen as a vehicle for an increase in productivity and efficiency, and consequently as a driver for economic growth. FDI is likely to have direct and indirect effects on host economies. Increasing capital formation, employment and trade is the direct effects of FDI, whereas receiving a beneficial transfer of know-how and technology, and management skills from home country responds to indirect effects of FDI. With the advantages of cheap labor and capital resources of member countries, ASEAN has built an attractive business environment for multinational corporations seeking profits through the implementation of different channels of FDI. With aforementioned advantages as well as drawbacks of labor market, ASEAN countries need to work closely to reduce transaction costs, strengthen FDI promotion policies and harmonious development of the economy among member countries in order to utilize FDI inflow. This paper provides information about FDI and labor market and deepens its analysis of FDI and labor market in ASEAN. After that, based on the current status of labor market in Vietnam, the paper shall give several implications for Vietnam‟s labor market. 2. Current situation of FDI into ASEAN countries 2.1. ASEAN is one of the most attractive destinations for foreign investment of the world After 51 years of establishment, cooperation and continuous development, ASEAN consists of 10 members in Southeast Asia, the third largest market in Asia with over 620 million people, accounting for 8.59% of total population. GDP per capita reached US$ 4,305, which is expected to double by 2030, making ASEAN the seventh-largest economic community in the world, with a combined GDP of US$ 2,766 billion. 478
2. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 ASEAN has become the world's largest FDI attraction with US$ 136.2 billion, marking the third consecutive increase of FDI. In 2013, for the first time, ASEAN exceeds China in terms of attracting FDI (US$ 128.4 billion versus US$ 117.6 billion). FDI continued to grow in 2014-2015. This is a very impressive figure given the decline in global investment by 16% in 2014. Improving the regional investment environment as well as the process of integration towards the forthcoming AEC has contributed to ASEAN's attraction to FDI inflow. According to the Ministry of Industry and Trade of Viet Nam, ASEAN has become an attractive destination for foreign investment, with FDI inflow in 2017 reaching US$ 137 billion compared with US$ 22 billion in 2000 and US$ 1/3 billion in 1967. Intra-regional investment also rose to a record US$ 24 billion in 2016, accounting for a quarter of FDI inflow into the region, increasing from 5.6% to 24.7% in 2016. Services sector accounted for the largest proportion of FDI in ASEAN, up from 50.8% in 1999 to 80.8% in 2016, followed by industry, energy and agriculture. Figure 1: FDI flows into ASEAN member states in 2017 Source: ASEAN Secretariat (2017) UNCTAD estimates 2.2. Major Powers in the world invest more in ASEAN due to the strong internal force Figure 2: FDI in ASEAN Source: UNCTAD, 2017 While Japanese investors are interested in industrial manufacturing, Chinese investors focus on finance, wholesale and retail, transportation and real estate. Investors from Australia, the EU and US are interested in services, mainly financial services. EU FDI in manufacturing has declined, while investment into finance and other services (in particular in wholesale and retail trade) increased substantially, along 479
3. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 with renewed interest in mining activities. Over time, the industry pattern has changed. EU FDI has become more concentrated in finance and other services, which contributed to at least 85% of all EU FDI in ASEAN in 2011–2016. Figure 3: EU services FDI flows in ASEAN, 2000-2016 Source: ASEAN Secretariat, ASEAN FDI database 3. Current situation of the labor market of ASEAN countries 3.1. Abundant and young labor force Economic growth of ASEAN is impressive, with an average annual real growth rate slightly higher than 5%. Along with a young population – where 60% are below the age of 30 – this translates to an immense potential in labor.The association has the third largest labor force in the world behind China and India. Current World Bank estimates place ASEAN‟s labor force at 350.5 million. In order to make full use of the wealth of labor, ASEAN member countries must do more to realize its economic ambitions. Cambodia Lao Myanmar Indonesia Low skilled Viet Nam Thailand Medium skilled Philippines Malaysia Singapore 0 20 40 60 80 100 120 Figure 4: Employment share of ASEAN in 2017 Source: WEF, 2018 3.2. Lack of skilled workers In a commentary published by the S. Rajaratnam School of International Studies, Senior Analyst with the Centre for Multilateralism Studies (CMS), Phidel Vineles (2010), argues that the region – especially the ASEAN-5 (Singapore, Malaysia, Thailand, Indonesia, and the Philippines) – lacks industry-ready skilled workers in spite of its vibrant demography. In Singapore, the nation‟s dependence on foreign workers and a lack of innovation in the Singaporean education system as primary challenges to its labor force. Malaysia and Thailand face similar challenges in equipping their respective workforces with engineering and science skills. Besides 480
4. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 that, Indonesia and the Philippines have high youth unemployment rates due to a workforce that is ill- equipped with skills and knowledge needed by key industries. Brunei, which is moving away from oil dependence to a knowledge-based economy, is finding it difficult to equip its labor force with necessary research and development skills. CLMV (Cambodia, Lao, Myanmar and Vietnam) economies broadly lack coherent technical education which is necessary for industrial development. 3.3. Facing a lot of difficulties Other problems that labor market of ASEAN countries is facing are as follows. Firstly, the mechanisms, policies and laws of each country are not consistent with the general agreement of ASEAN. In spite of the mutual recognition agreement, the provisions of this agreement are not uniform and have not received the consent of all member countries, which makes it difficult to obtain visas for skilled workers when moving to another country. Therefore, the workers who want to move smoothly should refer to the bilateral agreements of the member countries. Secondly, the skilled labor force of the member countries is very scarce, which in turn leads to the limitation of skilled migrants to ASEAN member countries. Fierce competition among countries to recruit skilled labor comes as a result. Thirdly, the level and quality of labor among ASEAN member countries are different. Obviously, a graduate student in Singapore will certainly be more highly qualified than a college graduate in Vietnam. Because of the difference in the level, the labor productivity of each country will be different. This would be a very difficult barrier for skilled workers in countries of lower qualification and productivity who want to move to a member country that is considered to have a quality workforce with higher productivity. Fourth, language proficiency is also a difficult challenge for the labor force. Workers tend to move to countries with cultural or linguistic similarities rather than to a country with many differences. Therefore, the desire to attract high quality workers is also greatly limited by this factor. 4. Effects of FDI on the labor market of ASEAN countries FDI expands the production set of the economy toward more sophisticated goods or introduces more advanced technology, thereby increasing the demand for skilled labor. This results in higher overall labor demand, higher wages for skilled labor, leading to a higher skill premium and increased average wages, and higher labor productivity. These eff ects are especially large in countries where skilled labor is scarce and the technological gap is substantial. 4.1. Effects of FDI on labor cost Wage is considered to be an important part of labor cost. In this paper, other components would be temporarily excluded. FDI does create more jobs for workers in Laos, Indonesia and Viet Nam but does not bring the workers much better income. As more FDI enterprises join domestic market, the demand for workers rises. In fact, a huge number of workers in these countries left domestic enterprises for FDI enterprises dreaming of better life with higher income. In ASEAN, foreign invested enterprises mainly focus on manual labor because the supply of labor is excessive. The supply exceeds the demand. Therefore, they do not seem to “worry” when workers quit. Higher income is a trick to attract workers whose understanding, vision is quite limited. Thus, labor cost is relatively cheaper since it does not take much time, effort for the employers to recruit staff, especially low-skilled workers. 481
5. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Figure 5: Minimum wage in ASEAN, 2018 Source: ASEAN Briefing, 2018 It is obvious that Thailand takes the first place in paying minimum wage for workers at US$295, followed by Philippines (US$288.3) and Indonesia (US$257). ASEAN Briefing (2018) illustrates that Indonesia‟s labor market contains significant regional variation because wages are set at a provincial level by Governors through Wage Councils and District Wage Councils of the archipelago‟s 34 provinces. The minimum wage in Jakarta, at Rp 3,648,035 (US$257.73) is almost 2.5 times greater than in Yogyakarta, the province with the lowest minimum wage at Rp 1,454,154 (US$102.74). In smaller cities, the minimum wages are usually even lower. Following the country‟s rapid economic growth, in the past few years, the Vietnamese government has increased minimum wages to combat inflation. As a result, the average monthly minimum wage in the country increased from 2,580,000 (US$111) in 2017 to 3,370,000 (US$145) in 2018. This increase follows a 7.3 percent hike that took effect at the start of 2017. Currently, the minimum wage ranges from VND 2,760,000 (US$120.0) per month in remote areas to VND 3,980,000 (US$173.0) per month in the key cities of Hanoi, Hai Phong and Ho Chi Minh City. According to the latest government notification, the wages will further increase to between VND 2,920,000 (US$125.7) and VND 4,180,000 (US$180.0), in the respective regions, from January 1, 2019. The rising wages could weigh on the country‟s competitiveness as the neighboring nations such as Laos and Myanmar have lower minimum wages. 4.2. Effects of FDI on labor demand FDI enterprises need local laborers to operate their plants, thus, they create more jobs and require skilled laborers. According to a study by ILO and ADB, the presence of AEC could lead to about 60% increased demand for high-skilled employment positions such as managers, professionals, technicians and associate professionals. Medium-skilled employment could also grow by around 25% with positions such as clerks, craft and related trade workers, plant and machine operators and assemblers and service and sales workers. Demand for low-skilled workers, meanwhile, could likewise rise by more than 60%. ASEAN internal integration could bring about the rise in labor demand at different levels. Therefore, it is understandable that the need for labor would also rise when more investment is poured into ASEAN. FDI into ASEAN is concentrated in the manufacturing and service sectors requiring a huge amount of human resources. In the second half of 2018, FDI enterprises in Viet Nam had to recruit more than 67,000 laborers due to the fact that the quality of Vietnamese laborers working in the FDI sector remains limited. The demand for skilled workers is increasing in the context of large volume of FDI. 482
6. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 In 2018, Indonesia attracted around 28 billion US$ in the sectors of electricity, gas and water, transportation, warehouse and telecommunication, mining and property. The need for skilled workers is forecast to grow from 55 to 113 million for the whole economy in general and for FDI enterprises in particular. The automotive sector with an annual growth of over 5% offers immense opportunities for foreign companies such as Japanese producers or German automotive companies. The energy sector and construction sector are also promising to attract investment. These sectors are in need of large amount of local laborers especially whose high skill to lower the costs. In Philippines, the situation is quite different. Large number of young Filipinos seeks employment overseas; hence, it faces a shortage of highly skilled labor supplied for both local plants and FDI enterprises. The abovementioned situation yields high demand for labor at different levels. 4.3. Other effects of FDI 4.3.1. Effects on productivity In general, productivity of ASEAN workers is quite low compared to other regions. However, with the presence of foreign firms, workers have tendency to improve their productivity themselves to compete with others. Many figures demonstrate that FDI helps to raise the productivity of ASEAN workers by pushing their competitiveness. There is an optimistic signal that worker in ASEAN countries acknowledge their rights and responsibilities more thoroughly, which results in the fact that workers now consider more carefully when taking a job. Workers with higher productivity have the right to ask for better income and working environment. The demand for skilled workers would rise because the productivity is improved, which means that the demand for low-skilled workers decreases. Positively, in the long time, the labor cost would rise in ASEAN. The case of Viet Nam For Viet Nam, direct employment in the foreign investment sector has increased from 330 thousand in 1995 to about 3.6 million in 2017, and indirect employment for about 5 - 6 million workers. Foreign- invested enterprises are also pioneers in training, improving the level and industrial style of workers, technicians and managers. Many of the previous positions employed by foreign experts have now been replaced by Vietnamese workers. Many foreign invested enterprises have paid attention to the social responsibility of the community, participated in hunger eradication, poverty alleviation and other volunteer activities. At the end of 2017, 58.4% of the total FDI capital is licensed in the manufacturing and processing industries. This shift has significantly contributed to the change in labor structure. According to the MPI's Foreign Investment Department, the shift of labor structure towards increasing labor density in the FDI sector contributed about 29.3% to the overall labor productivity growth of the economy in the period 2006 - 2016. 4.3.2. Effects on inequality Economic inequality can hamper policy efforts to eradicate poverty, and limit the availability of capital for individuals to develop skills and nurture enterprises. In a way, inequality is “institutionalized”, perpetuated in part by insufficient social protection, regressive economic policies, and geographic favoritism in development. Inequality also restricts the emergence of a middle class that could boost consumer demand. The GINI coefficient, a comprehensive gauge of economic inequality, indicates that ASEAN‟s is 42 (40.5 adjusted for population size). Countries with high scores which signal high inequality include Thailand (48.4, in 2011), Singapore (46.4, 2014), and Malaysia (46.2, 2009). ASEAN‟s inequality is lower than China‟s (46.9) but higher than India‟s (33.6) (MPI, 2019). 483
7. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 According to a study by the International Labor Organization (ILO) and the Asian Development Bank (ADB), by 2025, with the presence of AEC, 14 million additional jobs could be created and increase overall growth by 7.1%. However, it warns that the gains will not be distributed evenly. For the case of Viet Nam, according to Head of Legal Department of Vietnam Chamber of Commerce and Industry (VCCI), there exist inequalities between private enterprises and FDI enterprises. Meanwhile, the minimum wage increases, social insurance contributions also increase; logistics costs are still a burden for businesses and for the export-import economy like Viet Nam. Recently, the ceiling of the environmental protection tax bracket has doubled; the cost of seaport infrastructure continues to set out to create costs for businesses. Viet Nam still sets the first priority policy for state-owned enterprises (SOEs), FDI enterprises remain the second place, and the private sector in the country has to deal with difficulties. Currently, FDI has no spillover and is becoming a competitive force that squeezes domestic enterprises, making them increasingly difficult and shrinking. They enjoy great incentives for taxes, land, human resources, and administrative procedures, which any domestic private enterprise dreams of. Moreover, foreign-invested enterprises are also exempted from import tax on equipment, supplies, and means of transport and other goods to implement investment projects in Vietnam. During the investment process, if losses are carried forward to the following year, these losses will be deducted from taxable income. These are great advantages of this business sector but become disadvantageous for domestic private enterprises, when their potential and capacity are worse than those of foreign enterprises. 5. Recommendations for attracting FDI to strengthen the positive effects of FDI on the labor market of Viet Nam FDI along with exports are still considered the growth engine of the Vietnamese economy, thus, it is necessary to continue to strengthen and enhance the quality and efficiency of the FDI attraction. The official operation of the AEC requires the due attention and preparation of the Government, business community and every citizen in order to take full advantage of opportunities and overcome challenges. It is essential to speed up the institutional reform and improve the quality of the human resources, as well as the competitiveness of the economy and enterprises. 5.1. Promote the investment environment of Vietnam to attract FDI inflow Renovating thinking about FDI attraction, quality and efficiency of capital flow is a priority. Continuing to perfect the legal system and policies related to investment in a consistent, open, transparent, predictable and competitive manner compared to other countries in the region. Providing clear and detailed procedures and conditions for the application of foreign investment procedures and conditions to facilitate investment through transparent procedures; at the same time, to ensure the efficiency of state management of investment activities. Identifying the priority areas for FDI attraction, encourage: Not accepting projects with low economic efficiency, negative social impact as well as negative impact on the environment. Continuing to facilitate the implementation of existing FDI projects to ensure the progress and source of registered capital and focus on removing difficulties for enterprises, improving the business investment environment. It is necessary to shorten the preparation time for implementing the investment project. In addition, provinces and cities should also promote information for foreign investors on potentials, strengths and policies to attract investment and provide timely information on natural and socio-economic conditions and development plans for enterprises upon request. Most importantly, we should focus on attracting foreign investment in fields that Viet Nam has comparative advantages. 484
8. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 5.2. Hold annual meetings/seminars to exchange and learn between Vietnamese and foreign businesses and vice versa to increase joint ventures Investigation of PCI of VCCI for many years shows the proportion of domestic private enterprises participating in providing goods and services in the production chain for FDI enterprises is still limited. Therefore, it is necessary to organize business matching and trade promotion programs so as to create opportunities for enterprises to meet and exchange long-term and effective cooperation and exchange information on investment environment and business cooperation opportunities. The annual seminars would provide opportunities for enterprises of Viet Nam and partners to learn about policies to attract investment and study the business investment environment. Here, businesses can meet and talk directly with each other or with managers. In addition to the meetings, talks and seminars, practical activities, market surveys at trade centers should be held to help investors deeply explore the business environment, consumer culture of Viet Nam. The Government and local authorities design private industrial parks for FDI, it must also take into account the connection with industrial clusters for SMEs. More breakthrough is that when attracting high- tech enterprises, not only pay attention to connecting FDI enterprises with domestic enterprises, but also to create conditions and encourage businesses and corporations to set up centers and expand research and development activities with the participation of domestic engineers. 5.3. Encourage the use of Vietnamese labor at all levels of management in the FDI enterprises Vietnamese labor should be encouraged and given opportunities to participate in the management of the FDI enterprises in order to improve the level of senior management and managerial capacities for domestic workers. Education and training plays an essential role in raising managerial capacities. It is necessary to diversify the forms of training and strengthen job exchanges to create links between the labor force and the employers and to improve the quality of vocational training by linking training establishments and enterprise, which is an important and long-term strategy. In the context of the forthcoming 4.0 revolution and the increasingly competitive FDI attraction, FDI attraction in the coming time is determined by the shift from quantity to quality, focus on high-tech and environmentally friendly technology. Furthermore, attracting foreign investment with the advantage of cheap labor should be transformed into competing with high quality human resources. The authorities had better be active in training and fostering the labor force, meeting the needs of enterprises, especially in the fields that Vietnam is looking to attract investment. Supportive industry development will encourage the application and use of high technology. Accordingly, the workforce has the opportunity to meet, learn, improve skills, and contribute to accelerate the process of industrialization. At the same time, this helps limit the import of products from abroad, enhancing the employment of local people, creating growth in the economy. 5.4. Introduce foreign universities/vocational schools to invest in Vietnam to improve the quality of education in Vietnam In order to have a foundation for investment in education services, it is necessary to thoroughly study the demand for education at each educational level, each major and each mode of education, thus planning for the network of schools, education and training establishments. Another issue that needs attention in the process of guiding and supporting investors in education and training is finding a place. The quality of international education and training institutions is a requirement of a relatively large area for the construction of lecture halls, classrooms, libraries and research facilities and attractive to students. So far, very few educational institutions licensed can meet this requirement, but most of them are small-scale facilities. As a result, along with site rent incentives to reduce part of the cost of project construction, localities need to plan the specific location to fit the 485
9. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 specific characteristics mentioned above and provide extensive support to foreign investors to research, study, survey those locations. In order to promote FDI in the field of education and training, in the immediate future, it is necessary to develop and implement investment promotion activities, which requires good research and preparation of information on the project needed investing as well as information on the investment ability of partners to have appropriate movement, especially follow up, organize guidance, support investors from the time they intend to invest in Vietnam to have the basis for idea formation and project development. 5.5. Raising awareness of the workers about MRAsand exploring the possibility of extending MRAS to more sectors Currently, ASEAN has MRAs in place for eight sectors, which allow for a worker‟s skills, experience, and accreditations to be recognized across ASEAN, permitting them to work outside their home country. MRA in engineering service (2005) regulates that an engineer must first hold a license issued by the regulatory body of his or her home country and have at least seven years of work experience following graduation, two of which entail significant work. The application would then be submitted to the ASEAN Chartered Professional Engineers Coordinating Committee for review and, if successful, the applicant would be permitted to work in other ASEAN countries as a “Registered Foreign Professional Engineer.” In contrast, case-by-case assessments have been eliminated entirely for the tourism sector, allowing automatic recognition for 32 tourism-related occupations. One of the most common weaknesses of Vietnamese workers is language, which leads to their inferiority in working abroad. Not understanding or not understanding fully the favorable mechanisms, agreements would make Vietnamese workers lag behind others, even workers in ASEAN such as Filipino. Therefore, organizations such as Viet Nam Association of Manpower Supply should be the focal point to educate the workers about those mechanisms including MRAs. Job fairs should be held more frequentlyintegrating orientation and introduction about MRAs so that workers can acquire information officially. Once they know about the MRAs, they would find opportunities to improve their skills to match the demand of employers. Governments of ASEAN countries should take into consideration more sectors to be included in MRAs. The more sectors the more choice for workers. In ASEAN Economic Ministers Meeting, the agenda should include more labor related issues and discuss the possibility of MRAs in other economic sectors.The government of Viet Nam should build the national qualification framework according to the approved ASEAN framework, promoting the formation and development of credit conversion system and MRA recognitionbetween regional ASEAN and the world. At the same time, it should promote the plan to organize training in 8 occupations agreed by ASEAN. 5.6. Reducing protection for domestic labor in AEC ASEAN countries have certain defenses. These are the work permit rules and regulations of each country in the AEC. That is, when overcoming the skill barrier (common), workers must also overcome the technical barriers of each country (separate) as well as depending on the labor market demand in that country. For example: Vietnamese doctors who want to work in Thailand must meet the requirements of mastering Thai. This requirement is quite hard for doctors even who possess high professional qualifications. Similarly, in many countries, employers must prove that they cannot find good workers in their home country with the same salary to recruit foreign workers. AEC should be the mechanism that benefits member countries‟ economies. Labor force plays an essential part in each economy. Facilitating the recruiting process would provide workers more favorable conditions to work abroad. 486
10. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 6. Conclusion FDI is extremely pivotal to the developing economies, “with the enormous potential to create jobs, raise productivity, enhance exports and transfer technology, FDI is a vital factor in the long-term economic development of the developing countries” (UN, 2000). FDI provides employment open doors and job opportunities for host nation citizens. Workers are paid higher wages and this empowers them to have an enhanced way of life. New companies arise prompting the expanded improvement in production and manufacturing. FDI enhances and improves trading assets and resources of the host nation. Examination has demonstrated that, nations that get FDI from worldwide associations have lower financing costs, consequently their traded items are much less expensive and this improves exports. Increased capital inflow is generated by taxation in host nations is principally due to FDI as well. In order to limit the challenges and grasp high quality labor mobility opportunities in ASEAN, the burden of finding a solution to this conundrum lies within the domain of the government and private sector. Each member country's government should have solutions to liberalize the flow of skilled labor in the bloc. According to Vineles, since both depend on a skilled labor force, cooperation by both sides is necessary in ensuring the workforce is industry-ready and competitive. REFERENCES [1] Blundell, R. and T. MaCurdy (1999) Handbook of Labor Economics. [2] Loc, VC. (2012) International Investment, Ha Noi: Hanoi National University Publishing House. [3] Ngoc, N.V. (2015) Economics Dictionary, Ha Noi: National Economics University Publishing House. Electronic links and materials. [4] Academia, „ASEAN Comprehensive Investment Agreement‟, Academia. Available at: (Accessed: 01 September 2019). [5] Dung H, „Vietnamese workers are slowly moving to AEC‟, Vneconomy. Available at: (Accessed: 01 September 2019). [6] Foreign Investment Agency, „FDI attraction in the first 6 months of 2018‟, FIA. Available at: (Accessed: 01 September 2019). [7] Foreign Investment Agency, „Investment incentives‟, FIA. Available at: trangtin/157/Uu-dai-dau-tu (Accessed: 6 September 2018). [8] Giles C and Bach D.P, „Viet Nam seeks to attract more foreign investment with two new laws‟, Fww. Available at: investment-with-two-new-laws/#.XGpUMeQzbIV (Accessed: 6 September 2019). [9] Hung T.V, „The reality of attracting ASEAN‟s FDI to Viet Nam‟, Tapchicongthuong. Available at: 20180620031043535p0c488.htm (Accessed: 22 August 2019). [10] Khanh T, „Freedom of labor movement in ASEAN: What opportunities and challenges for Vietnamese businesses and Start-ups?‟. Available at: asean-co-hoi-va-thach-thuc-nao-cho-doanh-nghiep-va-start-up-viet-20160902142422208.chn (Accessed: 8 October 2019). [11] Loan N.T.N, „The growth rate of labor productivity in Vietnam and the impact on FDI attraction‟ Tap chi tai chinh. Available at: cua-viet-nam-va-nhung-tac-dong-toi-thu-hut-von-fdi-146903.html (Accessed: 5 September 2019). 487
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