What attracted the highest FDI capital into Vietnam in the past 5 years?

13.6 billion USD of FDI capital realized in 7 months

According to data from the General Statistics Office - Ministry of Finance , in the first 7 months of this year, total registered foreign direct investment (FDI) in Vietnam reached nearly 24.1 billion USD. Realized FDI reached 13.6 billion USD, up 8.4% over the same period, the highest level of 7 months in the past 5 years.

Singapore continues to lead among 74 countries and territories investing in Vietnam, with a total capital of 2.84 billion USD, accounting for 28.3% of total registered FDI capital. Notably, Malaysia and Sweden have risen significantly in rank. Capital flows from Malaysia recorded an increase thanks to the capital adjustment project at Yen So Park ( Hanoi ), adding an additional 1.12 billion USD.

Meanwhile, an investor from Sweden has a new project - a polyester recycling production complex and a process of converting textile waste into recycled plastic granules in Binh Dinh with a total investment of 1 billion USD.

In the first seven months of this year, total registered FDI capital invested in Vietnam reached nearly 24.1 billion USD.

Mr. Nguyen Van Toan - Vice President of the Association of Foreign Investment Enterprises - commented that normally when global trade is in trouble, FDI capital flows also slow down, but Vietnam is a rare bright spot. International investors see many positive signals such as plans to upgrade the stock market, reform the administrative apparatus, promote the private economy ... These steps strengthen investors' confidence that Vietnam will continue to accelerate strongly in the coming time.

FDI capital flows are shifting strongly into Vietnam, reflecting the long-term expectations and confidence of international investors in the sustainable development potential of the economy. The Business Confidence Index (BCI) in the second quarter of this year of the European Chamber of Commerce in Vietnam (EuroCham) shows that nearly three-quarters of European enterprises are willing to introduce Vietnam as an investment destination.

Mr. Bruno Jaspaert - Chairman of EuroCham - affirmed that European businesses still maintain confidence in the investment environment in Vietnam. That confidence is reinforced by the advantages of new-generation free trade agreements, especially the Vietnam - European Union Free Trade Agreement (EVFTA). August 1 marked the 5th anniversary of the EVFTA coming into effect, opening a period of deeper economic cooperation between the two sides. After 5 years of implementation, EVFTA has created nearly 300 billion USD in two-way trade value, while increasing Vietnam's attractiveness in the eyes of European investors.

Forming a unique competitive strategy

The Ministry of Finance assessed that the trend of shifting supply chains and US-China competition has created advantages to help Vietnam emerge as a new production center in Asia. Many multinational corporations have expanded their investments, especially in renewable energy - a field in which Vietnam ranked second among the top 10 developing economies in the 2015-2022 period, with more than 106.8 billion USD in FDI capital.

Eco-industrial parks, low carbon and strategic partnerships with the US, EU, Australia, Singapore, etc. are strengthening investor confidence.

However, attracting and effectively exploiting this capital source still faces a number of barriers. The Ministry of Finance frankly pointed out that some administrative procedures are still cumbersome; the efficiency of technology reception and transfer has not met expectations; the quality of human resources is uneven. At the same time, the contribution of FDI enterprises to improving Vietnam's industrial capacity is not high, there are not many large-scale projects that have a leading impact on the country.

bac-ninh-sap-co-them-kcn-yen-phong-iia-hon-1800-ti-dong-1640705488-1737468707377545001207.jpg — Infrastructure of industrial parks and economic zones will be invested synchronously.

Domestic enterprises have limited capacity, making it difficult to participate deeply in the global value chain. Infrastructure in some industrial zones has not met requirements, land funds with synchronous infrastructure are still limited and concentrated mainly in large localities. The supporting industry still lacks autonomy, failing to meet the production needs of large corporations.

In the context of strategic competition between major economies, the Ministry of Finance said that Vietnam is forming its own competitive strategy for attracting investment and sustainable development. The focus has shifted from pure incentives to improving the quality of the investment environment and business support services. Infrastructure in industrial parks and economic zones will be invested synchronously, ensuring power sources, clean land funds and high-quality human resources...