The Da Nang Hi-tech Park has received many projects in the first months of 2019 (Photo: VNA)
Hanoi (VNS/VNA) - Vietnam’s foreign direct investment (FDI)attraction is expected to make a leap, especially in quality, in 2019 as moreforeign investors, including big names, in the world’s high-tech manufacturingand services industries are choosing the country as their destination.
Data from the Foreign Investment Agency under the Ministry of Planning andInvestment showed foreign investors registered to pour 8.47 billion USD intoVietnam in the first two months of this year, 2.5 times higher than the sameperiod of last year. Disbursement of FDI projects also rose by 9.8 percentyear-on-year to 2.58 billion USD, hitting a three-year record high.
Notably, foreign investment in science and technology surged sharply,helping it for the first time rank third in the hottest sectors in thecountry’s FDI attraction.
The positive move is continuing this month with many provinces and citiesconsecutively announcing licences for high-quality projects.
In the early days of March, the central city of Da Nang said it licensedtwo projects of American giants – leading global manufacturer of aircraftcomponents American Universal Alloy Corporation and electronicsmanufacturer Alton International Enterprises – to set up theirproduction bases at its hi-tech parks while some others also from the US, suchas Key Tronic EMS, are also proposing projects in the park.
In the northern province of Bac Giang, Lenovo Group from China alsoexpressed a desire to develop a computer component factory during a recentmeeting with local authorities. The group said it would need 20-30ha of landfor the factory’s development and its products would be exported to the US, theprovincial portal reports.
Hanoi city, meanwhile, also expected to receive Ikea as the Swedishfurniture giant plans to invest 450 million USD in a retail centre andwarehouse system in the capital, Nguyen Duc Chung, Chairman of the municipal People’sCommittee, told a recent conference held by the Ministry of Industry and Trade.
While Ikea’s local subsidiary is well advanced with plans to launch theVietnamese centre, which will be Ikea’s main supply hub for its Southeast Asianmarket once completed, there are also forecasts that Apple could move itsfacility to the Southeast Asian country in the future.
Nguyen Van Toan, Vice Chairman of the Vietnam Association of ForeignInvested Enterprises, said that the rising high quality investment in Vietnamwas a positive signal, especially when the inflow remained unnoticeablecompared to the total FDI in Vietnam and the overseas investment capital ofthese investors in the world and ASEAN countries over the past years.
“The US, for example, invested some 300 billion USD in foreign marketsevery year while the investment in Vietnam was less than 1 billionUSD,” Toan said.
Echoing Toan, Vo Tri Thanh, a senior economist at the CentralInstitute for Economic Management (CIEM), stated that a rise ofhigh-tech FDI projects licensed in the first months of the year partlyshowed Vietnam as an attractive investment destination, buoyed by its freetrade agreements, close proximity to major global supply chains, high economicgrowth potential and the Government’s success in improving the investmentenvironment.
According to experts, the inflows of high-quality investors, especiallybig names, will help Vietnam solidify its position as a global manufacturingpowerhouse besides appealing to many other big components suppliers to thecountry.
As in the case of the American Universal Alloy Corporation, for example,its Chief Operating Officer for Universal Alloy Corporation and President ofUniversal Alloy Corporation Europe Kevin Loebbaka, revealed at the group’sproject launching ceremony in Da Nang recently that both Boeing and Airbus werepromoting manufacturing operations in Asia and they had a great interest in thefuture production site of UAC in Da Nang.
According to Toan, the Government is taking measures to lure high-techinvestment after three decades of FDI attraction, however, several hindrancesstill should be removed to optimise the fresh investment inflow.
“The Government should continue to improve business and investmenttransparency and safeguard intellectual property rights because investors fromdeveloped countries, including the US, often demand a transparent andconsistent investment and legal environment,” Toan said.
“It is also necessary to put investment protection regulations in the lawssince multinationals with high-tech projects are very interested in this. Theymust be assured that their legitimate rights will be protected,” he suggested.
Besides, Toan also urged the Government to focus on training to make thecountry more attractive to foreign high-tech investors as skills of thecountry’s workforce remain limited.-VNS/VNA
VNA
