Nation looks to build on 2021’s stellar FDI

Major groups in various industries are already forgetting about recent woes to pump new money in Vietnam, Le Toan

A draft report on socioeconomic development in 2021 and the plan for the whole of this year, compiled by the Ministry of Planning and Investment (MPI), highlighted impressive growth statistics in foreign direct investment (FDI) capital last year. The final report will be presented to the National Assembly’s May session for consideration.

According to the report, the total registered FDI inflow in Vietnam in 2021 was $38.85 billion instead of $31.15 billion, as the MPI initially published.

The change comes because of two billion-dollar projects that were handed investment certificates at the tail-end of 2021. One is the $2.3-billion Hai Lang liquefied natural gas power plant project, funded by a consortium including Vietnamese conglomerate T&T Group, Korea Gas Corporation, Hanwha Energy Corporation, and Korea Southern Power.

The second venture is the expanded facility project of Intel Products in Ho Chi Minh City, with a total added capital of $3.07 billion.

The two projects were not mentioned in the MPI’s original report on FDI in 2021 because investment certificates were not received until December 31. The MPI typically builds the report on the basis of figure collected by the 20th day of every month.

It was assumed that the Hai Lang venture would be included in the 2022 figures because the groundbreaking ceremony did not take place until mid-January.

As late as October last year, the MPI had forecast that FDI in Vietnam for the whole year could fall by between 0.2 and 3.4 per cent. But by the end of 2021, the figure was reported at $31.15 billion, up 9.2 per cent on-year.

The new figure of $38.85 billion equals an increase of 25.3 per cent on-year. The figures combined $7.11 billion of capital contribution and stake purchase segment, $18.9 billion in newly-registered capital, and $12.84 billion of added capital, signifying increases of 16.7, 24.3, and 76 per cent, respectively.

Experts from the Vietnam Association of Foreign Invested-Enterprises forecast that Vietnam could achieve $40 billion in registered FDI in 2022.

Meanwhile, director general of the MPI’s Foreign Investment Agency Do Nhat Hoang said that Vietnam remains in a favourable position to further attract foreign investments, despite prolonged uncertainties surrounding the pandemic.

According to Hoang, Vietnam is currently among the top destinations for foreign investors looking to diversify their supply chains, which, in turn, offers opportunities for local companies to further integrate into the global value chains.

“This year, investment commitments to Vietnam from abroad are set to rise thanks to the policy’s reopening of international flights, while at the same time, more countries are reopening their economies and adapting to a new situation,” Hoang added.