Vietnam has attracted more than US$15 billion in foreign direct investment (FDI) over the past 11 months, almost fulfilling the set target of US$16 billion in 2007. However, big projects licensed in December show that the figure will be far higher.
Vietnam has attracted more than US$15 billion in foreign direct investment (FDI) over the past 11 months, almost fulfilling the set target of US$16 billion in 2007. However, big projects licensed in December show that the figure will be far higher.
Investment flows continue
Three projects capitalised at billions of US dollars in total were licensed on December 11-12, showing the flow of FDI continues to pour into Vietnam.
Malaysia’s Gamuda Berhad Group received a license to build Vietnam’s biggest wastewater treatment plant and Asia’s biggest park in Hanoi with a total investment capital of US$2 billion.
The northern province of Bac Ninh handed over licenses to 7 projects valued at US$120 million at the ground-breaking ceremony for a Vietnam-Singapore Industrial Park in the province – the second of its kind in Vietnam after the first in southern Binh Duong province.
A US$180 million project to build a five-star tourist resort by Limitles World Vietnam got off the ground in northern Ha Long City, which boasts the World Heritage Site of Ha Long Bay.
Meanwhile, a joint venture between Malaysia’s SP Setia Berhad group specialising in real estate and Becamex IDC is awaiting a license for a US$120 million ecological area (Ecolakes) project to be located at the My Phuoc Industrial Park in Binh Duong province.
On the right track
Martin Rama, chief economist of the World Bank (WB) in Vietnam, recently said that Vietnam is on the right track to attract foreign investment, citing southern Dong Nai province as an example. He said that the province’s FDI is double the target set for 2007 due to application of the one-stop shop mechanism.
WB Country Director to Vietnam Ajay Chhibber suggested that Vietnam should continue with its administrative reforms to attract more FDI. At a recent press briefing prior to the Consultative Group (CG) Meeting for Vietnam, Mr Ajay said 2007 marks a memorable year for Vietnam as its FDI has hit a record high of US$16 billion. He noted that FDI disbursement accounts for 6.8 percent of GDP, a much higher rate than China as a result of the country’s successful reforms.
According to the WB Country Director, FDI sources only make up a small proportion of the total social investment capital as private investment sources are increasing considerably. This indicates that the Vietnamese economy is gradually reducing its dependence on foreign capital sources, highlighting the optimism among private businesses and encouraging foreign investors to come to Vietnam.
President of the Federation of French Businesses in Vietnam Frederic Sanchez said that the private sector in Vietnam plays a key role in the national economy as its contribution makes up 40 percent of the country’s GDP annually, offering attractive and profitable business for foreign investors including French entrepreneurs.
At the Vietnam Business Forum on December 4, Country Director of the International Finance Corporation (IFC) in Vietnam, Sin Foong Wong announced the results of a survey on the business environment in 2007. Most entrepreneurs expressed their optimism about investment prospects in Vietnam. Up to 90 percent of businesses has worked out plans to expand their investments during the next three years. Mr Sin attributed their optimism to the Vietnamese Government’s efforts in reforming the legal system, to bring it in line with the country’s commitments to the World Trade Organisation (WTO), along with the new initiatives for reform pledged by the new cabinet.
Vietnam is continuing to improve the business environment to bring it into line with its international commitments. The country’s full membership of the WTO and non-permanent membership of the UN Security Council has raised its profile and role in the international arena. Thanks to the Government’s great efforts and the National Assembly’s determination to go ahead with reforms, Vietnam is seen as an attractive destination for foreign investors.
In its recent survey, the United Nations Conference on Trade and Development (UNCTAD) placed Vietnam sixth in the list of 141 surveyed economies for investment prospects, just behind China, India, the US, Russia and Brazil.
(Source: VOV)
