Workers at a Japanese-invested firm in Vietnam (Photo: VNA) Up to 4.06 billion USD of capital was added by foreign businesses to 228 operating projects in the period, up 93.3 percent year-on-year, according to the General Statistic Office (GSO).
According to the GSO, 322 new foreign projects, capitalised at 3.21 billion USD, were licensed in the first three months, up 37.6 percent in the number of projects but down 55.5 percent in capital year-on-year.
The Foreign Investment Agency (FIA) attributed the substantial decline in newly-registered capital to fact that some large-scaled projects worth over 100 million USD were already registered in the first quarter of 2021. Capital pledged to such projects accounted for 75.3 percent of the country's total registered capital in the reviewed period.
For example, among these projects were the Long An I and II LNG power project, being invested by Singaporean investors in Long An Province with a total registered capital of over 3.1 billion USD and the 1.31 billion USD O Mon II thermal power plant being financed by Japanese investors in Can Tho city.
Meanwhile, the first quarter of this year saw only one foreign-invested project worth over 1 billion USD. That was a LEGO Manufacturing Vietnam plant, valued at 1.32 billion USD, in Binh Duong province, the FIA said.
In another bright spot, foreign investor capital contributions and share purchases doubled over the same period last year to 1.63 billion USD, which brought the total foreign investments into the country in Q1 to 8.9 billion USD, equivalent to 87.9 percent of the last year's same period.
The agency said many projects on manufacturing electronic and high-tech products have raised their level of capital in the first three months of the year.
The processing and manufacturing sector lured the largest share of FDI with over 5.3 billion USD, accounting for 59.5 percent of the country's total capital.
From January to March, Singapore was Vietnam’s leading foreign investor with nearly 2.29 billion USD, making up almost 25.7 percent of the total FDI registered in the country. The Republic of Korea followed with more than 1.61 billion USD or 18 percent, and Denmark with 1.32 billion USD or 15 percent.
At the same time, Vietnamese firms invested 211.5 million USD overseas in Q1, down 63 percent year-on-year, according to the FIA.
Of the sum, over 180 million USD came from 24 newly-licensed projects, up 28.5 percent, while the remaining 31.2 million USD came from three capital-added projects, a yearly decline of 93 percent.
Earlier, economic experts said Vietnam remained an attractive destination for foreign investment, which was likely to experience a surge in 2022 after a long hiatus due to the pandemic.
An increase in the number of new projects and investments in existing projects showed the strong confidence of foreign firms in the country's investment environment, they said.
Do Nhat Hoang, head of the FIA, said the country had been working with foreign partners looking to relocate their production centres. "Bringing their investment home was an effective way to support Vietnamese firms in integrating into the global supply chain," he said.
He said foreign investment was likely to pick up in 2022 as countries worldwide reopened and learned to adapt to the new normal post-pandemic.
Takeo Nakajima, head representative of the Japan External Trade Organisation, said Vietnam would continue to be one of the most attractive investment destinations for Japanese firms, especially after the visit to Japan by Prime Minister Pham Minh Chinh, who oversaw 25 cooperation agreements worth up to 12 billion USD.
The agreements have set up a strong foundation for Japanese investment to flow into Vietnam in 2022 and the near future, said Nakajima.
European firms have also been showing stronger confidence in the Southeast Asian economy./.
VNA
