Bringing FDI back to Vietnam
Vietnam has officially restored the visa policy, in order to open its doors to international tourists from March 15. But this policy will not only have a positive effect on tourism. The complete easing of entry measures after two years of closure is also expected to significantly contribute to boosting foreign investment.
In the past two years, although foreign investment still came to Vietnam, Mr. Do Nhat Hoang, Director of the Foreign Investment Department, said the obstacles and difficulties from epidemic prevention measures, as well as entry restriction measures, created restrictions. The decline of investment through the merger and acquisition form (M&A) was largely due to the inability of investors to come to Vietnam to learn about, negotiate and sign M&A deals.
Many investment plans have been delayed, and many projects have also been delayed in implementation because of difficulties in the entry policy for experts and foreign visitors. But the situation is different now. Multiple projects will be promoted, and one of them may be Amkor's semiconductor manufacturing project in Bac Ninh.
In mid-2021, Amkor sent a letter to Vietnamese authorities requesting favorable conditions for its senior experts to come to Vietnam to work. Initially, Amkor experts planned to come in late August, but in the end, due to the entry procedures, it was not until early November 2021 that they could enter the country to sign the agreement for the $1.6 billion semiconductor material manufacturing, assembling and testing in Yen Phong II Industrial Park.
In mid-December 2021, during a visit to South Korea of National Assembly Chairman Vuong Dinh Hue, leaders of Bac Ninh province handed over the Project Development Agreement and the Phase I Investment Registration Certificate to the investor. Accordingly, the first phase of this project has an investment capital of 520 million USD and is expected to be disbursed within five years. The remaining capital will be invested until 2035.
Recently, Bac Ninh authorities have approved the environmental impact assessment report for the project. This is an important basis for Amkor to quickly deploy this project. In addition to the fact that the Vietnamese Government has decided to "open the door", the opportunity for the early implementation of this project is more obvious.
"Many Taiwanese investors are also waiting for the Vietnamese Government's policies to open up and no longer restrict entry to make new investment decisions," said Mr. Le Tuan, from the Vietnam Economic and Cultural Office in Taipei.
Capital is coming back
Minister of Planning and Investment Nguyen Chi Dung affirmed that the prospect of attracting foreign investment into Vietnam in 2022 and the following years will be positive. "There will be many large-scale, high-quality projects of the world's leading corporations coming to Vietnam," he said.
Earlier this year, Samsung increased its investment capital by 920 million USD in Samsung Electromechanical Factory (SEMV), thereby bringing the total investment capital in Vietnam to over 19 billion USD, more than 28 times higher than the initial commitment of 670 million USD in 2008.
More importantly, according to Mr. Choi Joo Ho, General Director of Samsung Vietnam, in its development plan, Samsung will step by step turn Vietnam into not only a key global production base, but also a strategic center of R&D.
Samsung is accelerating the construction of a new R&D Center in Hanoi, at a cost of 220 million USD, in order to improve R&D capacity in the medium and long term. It is expected that the new center will be inaugurated by the end of 2022, in accordance with Samsung's commitment to the Vietnamese Government.
When the new R&D Center comes into operation, and focuses on research of the world's new technology trends such as AI, Big Data, IoT...the picture of Samsung's strategic investment in Vietnam will be completed.
Recently, Samsung held the GSAT recruitment 2022, after being halted last year due to the impact of Covid-19. Excellent candidates with good results in this GSAT exam will be selected as official employees of Samsung Vietnam and work at Samsung's production facilities in Bac Ninh and Thai Nguyen, and also at the Samsung Vietnam mobile phone R&D center (SVMC).
Recruiting a large number of staff in the "new normal" context is also an affirmation of the commitment to long-term and sustainable investment in Vietnam of Samsung.
Early this year, after increasing capital by 400 million USD to bring the total investment capital of the factory in Nghe An to 500 million USD, Goertek also raised investment capital by more than 300 million USD for its factory to process electronic equipment, audio and multimedia products in Bac Ninh.
Goertek has recently expanded its investment in Vietnam. This is a secondary manufacturer for many large technology enterprises in the world, including Apple. Last year, Goertek Vina in Bac Ninh earned a revenue of 3.28 billion USD, up 20.4% compared to 2020.
During the recent meeting with Minister of Planning and Investment Nguyen Chi Dung, the US-ASEAN Business Council’s Senior Vice President Michael Michalak affirmed that Vietnam is an attractive destination for US investors in the near future.
That is why Ford Vietnam increased production capacity and recruited more workers this year. Meanwhile, ExxonMobil Group is pursuing investment projects in Vietnam.
In February, on the occasion of President Nguyen Xuan Phuc's visit to Singapore, businesses of the two countries also signed cooperation documents worth nearly 11 billion USD, including SOVICO Group's cooperation agreements with partners such as Keppel Land, Keppel Energy Ventures... worth 5.2 billion USD, agreement on investment in a 500h industrial complex and a 200ha urban area with estimated capital of 2.5 billion USD between Saigontel, VinaCapital and Aurous (Singapore).
That is a testament to the return of foreign investment inflows into Vietnam.