Measures needed to sustain FDI growth trend: expert

A section of the North-South Expressway (Photo source: laodong.vn)

Hanoi – Foreign investors still put their trust in the Vietnamese economy, but it is important to take measures for sustaining the upward trend in foreign direct investment (FDI), an expert has said.

In the first four months of 2023, foreign investment projects disbursed about 5.85 billion USD in capital, falling 1.2% year on year, but this rate still rose 1 percentage point from the first quarter.

Meanwhile, foreign investors registered nearly 8.88 billion USD for new and existing projects and contributing capital to or purchasing shares of domestic companies, equivalent to 82.1 per cent of the amount recorded in the same period last year, according to the Ministry of Planning and Investment.

The ministry said although the disbursed capital of FDI projects declined, it still improved from the first months of the year. The newly registered capital bounced back after dropping slightly in the first three months, up 11.1 per cent from Q1, while the number of new projects continued to increase from the same period last year and surged 65.2 per cent from Q1.

The growth in the number of new projects has outpaced that in total registered capital, it pointed out.

Those statistics indicate that small- and medium-sized foreign investors maintain their trust in Vietnam’s investment climate. However, major enterprises remain prudent amid impacts of the global minimum corporate income tax.

Between January and April, the projects worth less than 1 million USD accounted for nearly 70 per cent of the new ones but just nearly 2.2 per cent of the total newly registered capital.

They concentrated in the localities boasting many advantages for foreign investment attraction such as Hanoi, Bac Giang, Ho Chi Minh City, Binh Duong, Dong Nai, Bac Ninh, and Hai Phong.

Asian investors still formed the largest proportion. Among them, Singapore, Japan, China, Taiwan (China), Hong Kong (China), and the Republic of Korea made up 75.1 per cent of the four-month foreign investment.

Dr Ta Dinh Hoa from the Academy of Finance told the Lao dong (Labour) daily that despite certain stagnation, FDI attraction in the first months has improved, showing foreign investors still keep their high expectations for the Vietnamese economy.

It is important to devise measures for sustaining the growth trend, he opined, recommending the country step up developing infrastructure, especially key transport projects, industrial parks, and export processing zones, to enhance its attractiveness to FDI.

Besides, it is also necessary to keep up with the global trend of strongly investing in green factors like green transport and green credit so as to attract foreign investors in a qualitative and sustainable manner, Hoa suggested.

Hung Yen creates momentum to improve investment environment The northern province of Hung Yen has taken drastic actions to improve its business and investment environment, and its efforts have paid off.

Bac Giang grants licences to projects worth 132 million USD The authorities of the northern province of Bac Giang on May 4 presented certificates recognising investment registration to two Singaporean-funded projects worth 132 million USD in the local districts of Viet Yen and Yen Dung.

Hai Phong licenses 4 new investment projects The northern port city of Hai Phong on May 9 granted investment registration licenses to a project to build Berths No.7 and 8 at Lach Huyen deep-water port area, and three others in the city’s industrial parks.

Vietnamese firms invest nearly 22 billion USD abroad There had been 1,643 Vietnamese-invested valid projects in foreign countries with a total capital of 21.93 billion USD as of late April, according to the Ministry of Planning and Investment’s Foreign Investment Agency.