|
Business expansion rumours rejected
Vietnam’s expanded foreign direct investment capital drive has hit a bump, but local authorities denied rumours that foreign investors were freezing business expansion plans.
Ministry of Planning and Investment Foreign Investment Agency (FIA) figures reveal that expanded foreign direct investment (FDI) capital reportedly declined from $2.9 billion in 2006 to $2.6 billion in 2007. FIA forecasts put the expanded capital at around $1.2 billion across this year and $1 billion next year. FIA general director Phan Huu Thang said that the reported figures did not reflect the true picture.
“Many foreign investors have chosen registering new investment projects in Vietnam instead of applying to expand existing projects. Their preference is due to Vietnam’s simpler and more transparent formalities in relation to registering new businesses in accordance to new investment and enterprise laws passed in 2005,” Thang said.
Thang said the Holcim cement venture was an example, which would start building its second phase with total investment of $656 million of its operating cement factory in southern Kien Giang province and E-United steel firm, which applied to add $2.4 billion to its under-construction manufacturing facility in the Quang Ngai province.
“If just these two expanded projects are counted, the expanded FDI capital will be drastically greater than the reported figure of $708 million during the eight months of this year,” said Thang.
The international community also agreed that Vietnam remained an attractive place for foreign investors to expand their business. The latest surveys of Jetro, a Japanese government-related organisation promoting trade and investment, also indicated that as many as 92.6 per cent of Japanese manufacturers and 88 per cent of Japanese non-manufacturers surveyed in Vietnam planned for expansion. They are the highest ratios in the South East Asian region.
The surveys released in June this year collected 1,745 replies from Japanese firms in 30 major cities and regions in Thailand, Malaysia, Singapore, Indonesia, the Philippines and Vietnam. Jean Michel Caldagues, representative of European Aeronautic Defence and Space Company – the mother company of Airbus, told Vietnam Investment Review that many foreign investors had decided to relocate their investment projects in Vietnam from neighbouring nations including China.
“Vietnam still has fundamental factors to draw foreign investors in medium and long terms and I am not surprised with Vietnam’s tremendous rise in newly registered FDI capital,” Caldagues said. FIA figures indicated that Vietnam licenced 772 new FDI projects worth of $46.3 billion in registered capital between Jan and August, four times higher than the figure of 2007’s first eight months.
The entire 2007 saw $18.7 billion in newly registered FDI capital. Shinya Abe, general director of Panasonic Vietnam, said it was undeniable that Vietnam has made great achievement in attracting and using FDI to develop the country during the last 20 years. “Such development has also improved the living standard of Vietnamese people and all aspects of the nation’s activities, brought many business partners and friends to Vietnam. I believe that Vietnam can be proud of that,” Abe said.
VNN
|
