FDI flows in Vietnam forecast to boom this year

FDI flows in Vietnam forecast to boom this year, Illustrative image (Photo: VNA)

Hanoi – Vietnam will experience a breakthrough in foreign direct investment (FDI) attraction to the fields of technology, renewable energy, health, banking and real estate, according to world media.

Investor-friendly policies, along with tax breaks and emerging industrial hubs beyond Hanoi and Ho Chi Minh City, have made Vietnam an attractive destination for foreign investors who are looking for sustainable long-term growth prospects.

The news site Vietnam Briefing, developed by Dezan Shira & Associates - a pan-Asia, multi-disciplinary professional services firm, recently wrote that Vietnam’s FDI landscape in 2024 is poised for robust expansion, with several opportunities in these above-mentioned sectors.

It quoted Vietnam’s Foreign Trade Agency as saying that the country experienced a surge in FDI in January and February, recording an influx of over 4.29 billion USD, marking a significant increase of 38.6% compared to the previous year.

The FDI capital disbursed in the first two months amounted to 2.8 billion USD, up 9.8% year-on-year.

Attracting the most were Hanoi, Quang Ninh, Thai Nguyen, Ba Ria – Vung Tau, Bac Ninh, Dong Nai, Bac Giang, Ho Chi Minh City, Hai Phong, and Hung Yen. These 10 localities accounted for 81.7% of the foreign investment received during January-February. Out of them, Hanoi capital city led the pack with nearly 914.4 million USD, which was up 24.4 times that recorded in the same period in 2023.

According to the news site, this year, Vietnam presents investment prospects across multiple frontier industries. The technology industry is experiencing a great deal of innovation and digitalisation. Similarly, the renewable energy sector is gaining traction, with a rising focus on clean energy sources like solar and wind power to sustainably bolster Vietnam’s power supply. Moreover, there is great anticipation regarding the demand-driven growth of the med-tech field and other healthcare-related industries.

Meanwhile, in its article titled “Vietnam ‘has been a development success story’: World Bank,” the US-based Washington Examiner website wrote: “While economic freedom is declining around the world, Vietnam is bucking the general trend. The country still has a lot of work to do to join the ranks of economically free countries, but it is moving in the right direction. No other country of comparable size has made such strong gains in the Index of Economic Freedom in recent decades.”

“Growth in Vietnam no longer revolves solely around agriculture as it has positioned itself in high-tech fields, including Industry 4.0, semiconductor chips, AI, and hydrogen, and is attracting international capital. Foreign direct investment amounted to 36.6 billion USD in 2023,” it added.

The New York-based Nasdaq Stock Market assessed that Vietnam's growing economy not only brings benefits to its people but also brings profitable opportunities to investors in many fields, typically technology and textiles. The country's economic growth momentum is also boosted by its capacity to attract FDI.

Hanoi ranks first for foreign investment registered in 2024 so far Hanoi attracted a total of $914.4 million in foreign investment during the first two months of 2024, including 27 newly-licensed projects with $869.8 million, 17 projects receiving additional investment of $9.1 million, and 21 instances of foreign investors contributing capital or purchasing shares, totalling $35.45 million.

Quang Ninh province to attract 7 FDI projects in March The northern coastal province of Quang Ninh expects to receive an additional seven foreign direct investment (FDI) projects from the US, China and Taiwan (China) in March.

Quang Nam approves projects worth over $800 million The central province of Quang Nam has issued approval to developers of 16 projects worth over $809 million in total.

High-tech mindset favoured for advances in processing Processing and manufacturing continues to lead the way in foreign investment mobilisation - however, moving towards a high-tech industry is essential for long-term and sustainable development.

PM urges FIEs lead the way on green transformation Seeing foreign-invested enterprises (FIEs) as an important driving force behind innovation, Prime Minister Pham Minh Chinh has called on them to help Vietnam implement its green transformation and sustainable development strategies.