Vietnamese FDI attraction likely to hit US$40 billion this year
Amid rapid economic recovery following the COVID-19 pandemic, Vietnam’s foreign direct investment (FDI) attraction this year is anticipated to record positive signs and hit US$40 billion, according to insiders.
|Goertek Group has increased its investment capital to US$500 million in a factory specialising in manufacturing electronic products, network equipment, and multimedia audio products in Nghe An (Photo: baodautu.vn)|
Last year, despite the adverse impacts caused the pandemic, the country was still able to attract US$31.15 billion in FDI, representing an annual rise of 9.2%.
Most notably, China's Goertek Group recently moved to increase its capital from US$100 million to US$500 million in a factory specializing in manufacturing electronic products, network equipment, and multimedia audio products in the central province of Nghe An, thereby becoming the largest investor in the locality.
Furthermore, Ju Teng International Holdings Ltd has been granted an investment certificate for its electronic component and automobile accessories project worth US$200 million at the Hoang Mai Industrial Park in the central province of Nghe An with Excel Smart Global Limited being the main investor.
Moreover, the northern province of Bac Giang has granted investment certificates to a number of Taiwanese financiers, including Zhengzhou Boruikate Tools Co. Ltd and FUSHINI Vietnam Joint Stock Company. In addition, Capella Real Estate Joint Stock Company also received an investment certificate in order to build infrastructure for Yen Lu Industrial Park, with total investment reaching roughly VND2,700 billion.
Prof. Nguyen Mai, chairman of the Association of Foreign Invested Enterprises (VAFIE), believes that moving forward the nation is likely to attract US$40 billion of registered capital this year. This can largely be put down to the signing of new generation free trade agreements (FTAs), continued economic recovery, and the reopening of international routes as the COVID-19 pandemic has been brought under control.
Le Tuan, head of Investment Department under the Vietnam Economic and Cultural Office in Taipei, revealed that several Taiwanese investors have devised their investment plans and were in the process of waiting for the country to reopen international flights before injecting their capital.
Aside from Taiwanese investors, Japanese, Korean, and Singaporean financiers have also unveiled their new plans in the Vietnamese market through a number of large-scale projects locally, all of which clearly demonstrates the trust of foreign investors in the Vietnamese investment climate.
The UN Conference on Trade and Development (UNCTAD) forecasts that global investment flows will recover this year and are likely to hit US$1,500 billion thanks to pandemic containment efforts at countries globally and new investment incentive policies.
In line with this, the country will remain an attractive investment destination for foreign financiers due to it being a key investment hub within the ASEAN region, along with its improved business climate and enhanced national competitiveness, experts said.
Low labour costs, a geographical location close to Asian supply chains, and Japan and the Republic of Korea (RoK)'s efforts to promote greater overseas investment are considered as three factors in boosting Vietnamese foreign direct investment (FDI).