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Encouraging result of FDI attraction in Vietnam
A total registered capital of foreign direct investment (FDI) in Vietnam in the first half of this year hit a record high with US$31.6 billion. The figure shows Vietnam is still an attractive destination for foreign investors even though Vietnam economy is facing many difficulties and challenges such as high inflation and big trade deficit.
Striking figures
A series of large-scale FDI projects with investment capital reaching US$ multi-billion each has been licensed in recent months. Two biggest projects are Taiwan's Ha Tinh Formosa Hung Nghiep iron/steel project with a total registered capital of over US$7.8 billion and Kuwait's Nghi Son Oil Refinery-Petrochemicals project in Thanh Hoa with a total investment capital of US$6.2 billion.
According to the Ministry of Planning and Investment's Department of Foreign Investment, a total registered FDI capital of newly-licensed projects in the first half of this year has quadrupled year on year. Out of a total of licensed 487 projects, there are 19 projects with a total registered capital up to US$28 billion, in which six large-scale projects with investment capital of more than US$1 billion each.
In addition, an average investment capital reaches US$ 64.7 million per project, the highest to date.
Head of the Department of Foreign Investment Phan Huu Thang said that a total registered FDI capital of US$31.6 billion manifested foreign investors' confidence in business and investment environment in Vietnam. They have not paid attention to immediate difficulties that Vietnam are facing with, rather they have paid attention to medium and long-term development potential and their trust in the Vietnamese Government's ability of running the economy just to bring it out of current difficulties.
An obvious investment trend in the six first months is that foreign investors have been focused on real property. Out of 19 large-scale licensed projects, 15 projects have been invested in building tourism areas, high-class hotels, offices, apartment buildings and so on.
Mr. Thang affirmed that this investment trend was in complete conformity with Vietnam's FDI attraction orientation that is to build infrastructure so that Vietnam can become a safe and attractive tourism destination for foreign tourists.
Besides, a trend of shifting investment activities from two big cities, namely Hanoi and Ho Chi Minh City, to neighbouring localities becomes clearer as there are many investment projects in such cities and provinces as Ba Ria - Vung Tau, Dong Nai, Thua Thien – Hue. The main reason behind this trend is that these two cities find it impossible to meet the requirements for sectorial planning and a good land fund for projects.
Speeding up delivery of capital
Another striking point in the FDI picture in the first half of the year is that implemented FDI capital has also hit a record high with nearly US$5billion, up 37.6% compared to the same period last year, as a result of immediate deployment of a lot of large-scale licensed projects such as Piagio group's Vespa motorbike production project which was licensed in late 2007, and the plant's production warehouse was completed just in May, 2008; the Ho Tram high class hotel and tourism area construction project once licensed in last April, was started right after that.
For many large-scale projects, particularly in the field of property business, despite sky-rocketing price of construction materials, foreign investors still have accelerated the implementation rate in a move to come to meet market demand within the next two years.
According to Mr. Thang, with current rate of FDI implementation, the delivery of FDI capital is expected to set a record high with over US$10 billion.
Domestic infrastructure has been gradually improved. Projects in the fields of electricity, post - telecommunications, roads, bridges, airports and ports construction have been invested and implemented by ministries and branches in accordance with the approved schedule, ensuring their completion and being putting into operation by 2020.
At present, a lot of localities have clearly recognised the importance of supplying high quality human resources to foreign investors, especially in the field of high-tech, and so they are in active collaboration with investors to train and supply these human resources.
Mr. Thang futher stressed the Ministry of Planning and Investment will form some missions to inspect FDI projects in the fields of sea ports, education and training, real estate and so on in order to deal in time with difficulties in the process of projects delpoyment.
ND
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