Good news for FDI fortunes

illustration photo - source: satthep.net

Formosa Ha Tinh Steel Corporation, a subsidiary of Taiwanese Formosa Plastic Corporation, early this month imported its first equipment for the construction of its $8.9 billion steel manufacturing and seaport complex in central Ha Tinh province, licenced in 2008.

Chu Chun Fan, a representative of Formosa Ha Tinh Steel Corporation, said the firm in March would start dredging an access channel to the port site and leveling the ground surface.

Fan said Formosa would spend about $338 million finishing the above works within 10 months. Those works are Formosa’s first steps to push the construction of its first steel manufacturing project after 30 months of delays due to site clearance issues.

Like Formosa, many foreign investors began constructing of their registered projects.

Asian Coast Development Limited, for instance, is now pushing the construction of the $4.1 billion recreation resort Ho Tram Strip in southern Ba Ria-Vung Tau province, which was started in the third quarter of last year after two years of delays.

“This year 2011 will see intense activity on our Ho Tram Strip site, as we gear up for the 2013 opening of our first phase, the MGM Grand Ho Tram,” Asian Coast Development Limited chief executive officer Lloyd Nathan told VIR.

Ho Tram Strip is the first to represent Las Vegas-style integrated resort development in Vietnam. The first phase of this project will include a five-star hotel, initially 541 rooms expanding to 1,100, and a 13,600 square metre entertainment area.

Multinational firms like PepsiCo, First Solar and Samsung Electronics are also pushing the construction of their projects. PepsiCo, the world’s second-largest food and beverage business, last month started to built a $73 million plant in Vietnam Singapore Industrial Park Bac Ninh to produce popular carbonated and non-carbonated beverage brands.

US-based First Solar, right after receiving investment certificate last month, broke ground on its $300 million solar cell manufacturing factory in Ho Chi Minh City.

The move of those foreign investors will contribute to raise foreign direct investment (FDI) disbursement in Vietnam.

“Foreign investors are making their commitments come true. That is a good signal for the economy,” said Nguyen Mai, chairman of the Foreign Invested Enterprises Association in Vietnam.

He said the positive moves indicated the current challenges of the economy like ramping inflation and trade deficit had not hampered foreign investors.

Statistics from the Ministry of Planning and Investment’s (MPI) Foreign Investment Agency showed net FDI reached $420 million in the first month of this year, a 5 per cent year-on-year jump.

The MPI late last year forecasted to attract $11.5 billion of net FDI this year, but disbursement capital could be much higher than initially forecast this year.