Vietnam remains favored destination for foreign investors despite COVID-19
Despite the complexity of the current COVID-19 wave, Vietnam is still a bright spot for foreign investors. Vietnam has increased its competitiveness and resulted in positive outcomes in foreign direct investment (FDI) attraction.
According to a recent report of Ministry of Planning and Investment, foreign investors channelled 19.12 billion USD into the country in January-August, equalling nearly 98 percent of the same period last year, with several multi-billion USD projects. In 2021's first 8 months, Vietnam attracted investors from 92 countries and territories.
Despite social distancing measures to curb the spread of COVID-19, the country’s FDI inflow in the first eight months only saw a slight decline of 2.1 percent against the same period last year, said Nguyen Van Toan, deputy head of the Vietnam’s Association of Foreign Invested Enterprises. Of note, new registered capital surged 16.3 percent and disbursement of FDI capital hit 11.58 billion USD, up 2 percent.
Phan Huu Thang, former head of the Vietnam Trade Promotion Agency (Vietrade) at the Ministry of Industry and Trade, voiced his belief that FDI inflow into Vietnam may still reach about 30 billion USD this year.
To address current difficulties facing foreign investors when they want to enter the country to study investment possibilities or to implement investment projects, the Government and relevant ministries and agencies are urged to consider reducing quarantine period for those who have been fully vaccinated and hold a negative COVID-19 testing certificate.
Dorsati Madani, Senior Economist at the World Bank (WB) Vietnam recently has said that,Vietnam’s economy will recover on the back of solid growth achieved in the first half of 2021 after the lockdown is lifted. The economy is likely to bounce back strongly from the end of the third quarter, similar to how it has recovered after the lockdown was eased in April last year.
She said though Vietnam is facing multiple economic risks due to impacts of the COVID-19 pandemic, its economy has proven to be resilient and dynamic. The country was among a few nations sustaining positive economic growth last year.
Currently, the FDI sector accounts for 20% of GDP, over 50% of industrial production value and about 70% of export value of the country, and generates millions of jobs. Many world-leading corporations are making long-term investments and reaping success in Vietnam.
Vietnam has recently entered the top 20 countries globally in terms of foreign direct investment (FDI) attraction after recording USD 16 billion last year, as stated within the World Investment Report 2021 released by the UN Conference on Trade and Development (UNCTAD). The country secured 19th position in the overall ranking of FDI attraction last year, rising five places compared to 2019.
