Hanoi ranks third nationwide in FDI attraction with US$3.13 billion

Hanoi remained third among 60 cities and provinces in Vietnam having received foreign direct investment (FDI) in the first ten months this year with US$3.13 billion, accounting for 13.3% of total nationwide, a report of the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment has shown.

FDI commitments to Vietnam in the January – October period fell 19.4% year-on-year to US$23.48 billion.

Bac Lieu has attracted the largest portion of capital commitments with US$4 billion, or 17% of the total, while Ho Chi Minh City came second with nearly US$3.4 billion, or 14.6%. For new projects, Ho Chi Minh City attracted the largest number with 776 projects, followed by Hanoi with 438 and Bac Ninh, 125.

Source: MPI

Overall, disbursement of FDI projects in Vietnam totaled US$15.8 billion in the first ten months of this year, representing a decline of 2.5% year-on-year as the Covid-19 pandemic continues to wreak havoc on the global economy.

Such a decline, however, indicates an improvement from a 3.2% decline in the previous month, reflecting the gradual recovery of foreign-invested enterprises in the remaining months of 2020, stated the MPI.

Meanwhile, FDI commitments in the January – October period fell 19.4% year-on-year to US$23.48 billion. 

Year to October 20, 2,100 new projects have been approved with total registered capital of US$11.66 billion, down 32.1% in the number and 9.1% in capital year-on-year, while 907 existing projects have been injected an additional US$5.71 billion, down 20.8% year-on-year in number but up 5.71% in capital. 

According to the report, injections of US$1.38 billion in the Long Son Petrochemical Complex project in Ba Ria – Vung Tau province and US$774 million in the West Lake Urban project in Hanoi have directly contributed to a rise in capital addition.

During this period, 5,451 projects have had nearly US$6.11 billion in capital contributed by foreign investors, down 20.5% in the number of projects and 43.5% in value year-on-year.

Consequently, the proportion of capital contribution in total FDI commitment has significantly dropped from 37.1% between January and October of 2019 to 26% in the comparable period of 2020.

Data: MPI. Chart: Ngoc Thuy.

The MPI said while there have been declines in both the number and value of foreign projects in Vietnam, the FDI commitment to the country remains positive compared to others globally. This shows Vietnam continues to be an attractive destination for foreign investors.

Investors have poured money into 18 fields and sectors, in which manufacturing and processing led the pack with investment capital of over US$10.7 billion, accounting for 45.7% of total registered capital. Electricity production and supply came second with US$4.8 billion, followed by real estate with US$3.5 billion, and wholesale and retail with US$1.4 billion.

The report shows that out of 109 countries and territories investing in Vietnam in the first ten months of 2020, Singapore took the lead with US$7.51 billion, followed by South Korea with US$3.42 billion, and China with US$2.17 billion.

In terms of fresh projects, South Korea took the top spot with 528 projects, while China and Japan claimed the second and third positions with 294 and 226 projects, respectively.

Besides the US$4-billion LNG plant project financed by a Singaporean investor, some other big-ticket projects between January and October include a tire manufacturing plant worth US$300 million by a Chinese investor in Tay Ninh province; an additional injection of US$138 million into a Chinese-invested radial tire production facility; an addition of US$75.2 million to Japan's Sews-components Vietnam manufacturing plant for electronic and auto parts; and Hong Kong's Ce Link Vietnam 2 plant worth US$49.8 million in Bac Giang for manufacturing electronic parts and products.