Positive signs ahead for FDI attraction by year-end
Foreign direct investment (FDI) inflows into Vietnam as of November 20 surged by 0.1% to US$26.46 billion against the same period from last year, according to statistics released by the Ministry of Planning and Investment.
During the 11-month period, up to 1,577 new foreign-invested projects were granted licenses with a total registered capital of roughly US$14.1 billion, a drop of 32.8% in terms of the number of projects, but up 3.76% compared to last year’s corresponding period.
The major bright spot in the 11-month FDI picture is a sharp increase recorded in registered capital. Most notably, 877 operating projects were given permission to raise capital, representing a year-on-year decline of 16.6% in quantity but a rise of 26.7% in the total additional registered capital.
Furthermore, capital contribution and share purchases made by foreign investors stood at nearly US$4.4 billion, down 33% compared to the same period from last year.
The General Statistics Office (GSO) attributes the plunge in capital contribution and share purchases to the adverse impacts of the COVID-19 pandemic, which has also caused the 11-month FDI inflows into the Vietnamese market to increase by just 0.1%.
Singapore takes the lead among a total of 100 countries and territories investing in the nation throughout the reviewed period with over US$7.6 billion, thereby accounting for 28.7% of total investment capital in the country.
The Republic of Korea (RoK) ranked second with US$4.36 billion, accounting for 16.5% of total investment capital, an increase of 17.6%, followed by Japan with US$3.7 billion, a rise of 54%.
According to experts, FDI inflows into the nation both this year and next year are likely to reach a higher level thanks to investment promotion activities taking place overseas.
Bui Hoang Mai, head of the Industrial Parks Management Board of Bac Ninh province, revealed that the locality is expected to attract further FDI projects with a total capital investment of up to US$1.6 billion this December, duly bringing total FDI inflows into the province to approximately US$3 billion.
Economists pointed out that in order to attract high-quality FDI projects from transnational corporations, especially from developed markets such as the United States and the EU, Vietnam needs to pay attention to the local business climate, transparency, and stability, while simultaneously fine-tuning the legal system and simplifying administrative procedures.
