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Developers urge Vietnam govt to cut project delays

Lengthy formalities are the key stumbling block for both international and local property development companies despite high potentials on the market, they say.

They are backed by the Vietnam Tourism Property Association which is keen to work closely with developers to attract more visitors and boost the potential for international property investors.

One developer in the capital city of Hanoi says that has been waiting for 24 months to receive a license for a property project in the northern region and the red tape could put off foreign investors and developers which the country needs to boost its real estate industry.

‘If a local investor has to face such difficulty, how much of a challenge will a foreign company face,’ he said.

Frederick Burke, managing partner of Baker & McKenzie, said that regulations regarding the property industry in Vietnam were sound but the main problem is that administrative personnel are not well trained enough and could be a hindrance for investors.

Tran Xuan Gia, former minister of planning and investment, agreed.

He said that the main problem is with the staff and not the system.
The industry is warning that Vietnam needs to move quickly to iron out the problems.

Brett Ashton, managing director of Savills Vietnam, said that licensing procedures for a property investment or construction in Vietnam often took a longer time than in neighbouring countries.

‘This is one of the most disadvantages I’ve ever seen in Vietnam,’ he said.

Developers added that as well as creating more favourable conditions for new property investors, Vietnam should have policies to encourage existing investors to expand in the market.