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Vietnam Today

FDI continues to flow

Released at: 09:05, 29/10/2015

FDI continues to flow

Year-to-date figures increase handsomely against last year and while annual target may not be met all signs are positive.

by Quynh Nguyen - Anh Nhi

The latest Ministry of Planning and Investment (MPI) report shows that, as at October 20, 1,657 investment projects had been registered around Vietnam this year with total capital of $12.42 billion, up 26.9 per cent in numbers and 24.8 per cent in capital over the same period in 2014.

There were also 667 projects that increased their capital by a total of $6.87 billion. Total registered capital in the first ten months therefore stood at $19.29 billion, a 40.8 per cent increase year-on-year. The figure is especially impressive given the lack of large-scale projects.

Despite the positive signs in foreign direct investment (FDI) attraction, the annual target of $23 billion may be just out of reach. Over the last two months Vietnam will have to attract $1.85 billion each month, which is a big ask.

Even if the target goes unmet there are many positives to be found in the investment environment in general and expectations over attracting FDI in particular. Guidance documents for the Law on Investment and the Law on Business took effect on July 1 this year. Mr. Phan Duc Hieu, Head of the Business Environment and Competitiveness Department under the Central Institute for Economic Management, said that in order to support the two new laws the department has finished decrees, of which Decree No. 96 guiding the Law on Business was issued last week.

Mr. Arakawa Yoshio, CEO of Universal Procurement Systems Vietnam, said that Vietnam is an ideal investment destination for the enterprise at this time, after previously investing in Myanmar. “Choosing Myanmar instead of Vietnam was due to incentives,” he said. “But now is the time to invest in Vietnam because of increasing demand for IT in the country.”

The MPI report noted that, along with positive developments in attracting FDI, disbursed capital in the ten months also increased 16.3 per cent compared with same period of 2014. The FDI sector maintained its role as the main economic driver, contributing to export growth. Exports by the sector in October totaled $10.1 billion, up 2.3 per cent against September and 5.7 per cent year-on-year.

Export turnover by the sector (including crude oil) in the first ten months reached $95 billion, 14.3 per cent higher than in the same period last year, while import turnover was $82.1 billion, up 19.3 per cent. The FDI sector therefore recorded a trade surplus of $13 billion, while the domestic sector saw a deficit of $17.1 billion. Manufacturing and processing continues to attract the most FDI, followed by power, water, gas, and real estate.

FDI by sector 


Among the 59 countries and territories with new investment projects in Vietnam during the first ten months, Malaysia suddenly took the lead, followed by South Korea, the UK, Japan, Taiwan, Singapore, and Hong Kong. 

FDI by country

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