Improved business environment attracts more foreign investment

As per the Foreign Investment Agency under the Ministry of Planning and Investment, more foreign companies poured capital into their business in Vietnam, proving that the Vietnamese investment environment was attractive to foreign investors.

At a Japanese-invested company (Photo: SGGP)

In the first quarter of 2018, Vietnam received an estimated $3.88 billion in foreign direct investment (FDI) projects, up 7.2 percent from the same period in 2017.

The country had 618 new investment projects with registered capital of $2,121 million, an increase of 25.4 percent on the quantity. This proves that the Southeast Asian country has better investment environment.

South Korea was the leading country in investing in Vietnam with the total registered capital of $1.84 billion followed by Hong Kong (China) and Singapore with registered capital of $689 million and $649 million respectively in the first three months.

FDI enterprises invested in 19 industry sectors of the country’s economy. The manufacturing and processing industry received the most foreign funds with $188.52 billion accounting for 58.5 percent the country’s total investment; followed by the realty sector with $53.56 billion and electricity, gas and water supply with $21 billion.

Investors have invested in 63 provinces and cities in Vietnam, with investment focusing on big cities. Ho Chi Minh City was leading city in attracting foreign investment with $44.25 billion accounting for 13.7 percent of total investment.

Next was the southern province of Binh Duong with $30.67 billion and Hanoi with $27.69 billion.

Economists said that though there has been an increase of 25.4 percent with 618 new FDI projects in the quantity yet there has been a decrease of 27.3 percent in the registered capital.

Meantime, investors poured $1,789 million on 199 registered projects before, a year-on-year drop of 54. 6 percent. As a result, total registered investment in first three months was $3,911 million, a fall of 43 percent compared to same period last year.

However, it was not a basis to pronounce that foreign funds will reduce this year because according to the General Statistics Office of Vietnam’s survey of business trend in the processing industry, 33 percent of enterprises said that the condition in the first quarter this year was better than last year while 24.6 percent firms thought that it was in difficult and 42.4 percent supposed that it was stable.

The Foreign Investment Agency explained in the first quarter of 2017, Samsung poured $2.5 billion into its plant in the northern province of Bac Ninh. This year saw no project worth billions of dollar.

Nevertheless, foreign corporations still invested more in new and available projects. For instance, $150 million Singapore-invested Hanbaram Wind Power Plant Project in the central province of Ninh Thuan; Vina Cell Technology company poured $100 million in its plant in the northern province of Bac Giang; $80 million Ykk plant of Japanese investor in the northern province of Ha Nam.

According to investors, Vietnam’s improved business environment has attracted them. For instance, a representative from the Japan Trade Promotion center in HCMC said that the operation of electronic government in Vietnam has initially developed its effectiveness. Hence online application of imported products facilitated importers./.

VNF/SGGP