Minister of Planning and Investment Bui Quang Vinh adds that registered and disbursed foreign direct investment (FDI) along with the issuance of investment certificates during the period have been consistent with a stable business climate.
Dr Nguyen Dinh Cung, Central Institute for Economic Management (CIEM) Director in turn echoes Vinh’s views, saying Vietnam offers a welcoming environment for foreign firms that wish to establish a presence including solid economic growth and political stability among other things.
Though Vietnam has become more attractive with its tax incentives, low-cost labour, and long coastline and its increasingly modern and sophisticated port infrastructure, FDI attraction policies still naturally face some challenges.
To overcome these obstacles and continue to attract more FDI in the future, Vietnam needs to take a long-range view and develop a national strategy that embraces FDI as a powerful driver for sustainable economic development, Cung said.
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According to the Foreign Investment Agency (FIA) during the 10 month period, newly registered FDI capital dipped by 23.9% to US$9.95 billion, representing a total of 1,306 projects.
Meanwhile the FIA reported supplementary capital for existing projects dipped 39.1% to US$3.74 billion for 469 projects.
Combined, this financially translates to a dip of about 28.9% on-year to US$13.7 billion of new and supplementary registered capital into Vietnam for the 10 month period. In explaining the cause of the declining FDI registered capital, FIA Deputy Director Nguyen Noi says the reduction was principally due to the reduction in the number of large scale projects this year as compared to 2013.
Right from the beginning of planning, we have anticipated fewer large projects and accordingly, the reduction comes as no surprise or cause for alarm, Noi notes.
There are a fewer projects having capital of more than US$1 billion each this year while the overwhelming majority (70%) of FDI projects have registered capital of under US$5 million that is the main cause of a decline in FDI capitalization this year, Noi concludes..
Tran Duy Dong, Director of the Ministry of Planning and Investment (MoPI)’s Economic Zone Management Department, agrees with Noi as saying in fact many foreign investors have continued to pour investment into their business in Vietnam.
This clearly has demonstrated their continued confidence in the country. Even some businesses from China and Taiwan (China) have invested in Vietnam this year. He cites the Samsung CE Complex and Samsung Display Bac Ninh projects, which each have registered capital of more than US$1 billion, as prime examples of the confidence of foreign investors in the country.
Most notably the FIA reports that in 10 month period, disbursed FDI actually jumped 5.9% to US$10.15 and the figure is expected to increase 8.7% to US$12.5 billion by the end of the year.
