FDI attraction, bright colour in Vietnam’s economic picture

JA Solar Vietnam Company Limited, a Hong Kong (China) invested company in Quang Chau industrial park (Bac Giang) (Photo: VNA)

Hanoi (VNA) - In eleven months of 2019, total newly registered and additional capital and share purchase by foreign investors reached 31.8 billion USD, up 3.1 percent compared to the same period last year.

In recent years, foreign direct investment (FDI) flow into Vietnam has kept increasing. According to economic experts, in the context that the world’s economy is slowing down, Vietnam’s economy continues to growing fast, even the fastest in ASEAN, in 2019 and the trend is kept going in the coming years.

“Bright star” in FDI attraction

Bloomberg news agency and many international media recently published articles highlighting Vietnam's economic achievements, and forecast the country's economy will continue to grow strongly.

Bloomberg said that Vietnam is really making a break through beyond expectations, citing Vietnam's Prime Minister Nguyen Xuan Phuc’s announcement of Vietnam's GDP growth target for 2020 of 6.8 percent and estimated GDP increase for Quarter 3, 2019 of 7.31 percent over the same period last year.

Reuters reported that in the first 10 months of 2019, the realized capital of foreign direct investment (FDI) projects in Vietnam was estimated at 16.21 billion USD, up 7.4 percent over the same period in 2018.

According to Reuters, FDI inflows are an important factor to ensure Vietnam's economic growth, FDI companies account for about 70 percent of the country's exports.

Regnum news agency also highlighted Vietnam's economic performance - such as up 15 places on the best economy rankings to invest, ahead of Southeast Asian countries such as Malaysia, Singapore and Indonesia.

General Manager of Foreign Investment and Management of UOB Bank (United Overseas Bank) Sam Cheong Chwee in an article analyzing the regional economic situation in the Morning Complex newspaper (Singapore) on October 9 also identified that Vietnam is becoming a bright star in attracting foreign investment capital in Southeast Asia.

FDI attraction up 3 percent in 11 months

The Foreign Investment Agency under the Ministry of Planning and Investment reported that in the 11 months of 2019, total newly registered and additional capital and share purchase by foreign investors reached 31.8 billion USD, up 3.1 percent compared to the same period last year.

FDI disbursement was estimated at 17.69 billion USD, up 7.2 percent compared to the same period of 2018.

Major partners are from Japan, the Republic of Korea, China, Hong Kong (China), Singapore…

The foreign investment sector posted an export value of nearly 166.7 billion USD including crude oil, up 3.8 percent over the same period last year and accounting for 69.1 percent of the total export revenue.

Export value excluding crude oil reached 164.83 billion USD, up 3.9 percent over the same period last year and accounting for 68.3 percent of the total export revenue.

The agency further said that there were 117 countries and territories investing in Vietnam. Hong Kong (China) topped the list with total registered capital of 6.69 billion USD, followed by the Republic of Korea, 5.73 billion USD and Singapore, 4.47 billion USD.

Of 60 cities and provinces, Hanoi drew the largest amount of FDI with a total registered capital of 6.82 percent, accounting for 21.5 percent of the total investment.

Ho Chi Minh City came second with 5.48 billion USD, followed by Binh Duong, Dong Nai and Bac Ninh provinces.

Selection of foreign investment

The Political Bureau of the Communist Party of Vietnam adopted its first-ever resolution on orientations to perfect institutions and policies for and improve quality and efficiency of foreign investment cooperation through 2030. Resolution 50/NQ-TW is expected to enable foreign investors to move forward for future development and help improve the quality of foreign investment inflow in the country.

The resolution states that the foreign-invested sector, a significant component of Vietnam’s economy, is encouraged to develop, cooperate, and compete equally with other economic sectors. The State respects and protects lawful rights and interests of investors, ensuring the harmony of interests between the State, foreign investors and workers in foreign-invested enterprises.

As resolved by the Politburo, the country will attract foreign investment in a selective manner, focusing on quality, efficiency, technology and environmental protection. Priority will be given to projects that use advanced technology and modern management with high added value and spillover effects and are able to connect to the global production and supply chain./.

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