A foreign-invested firm producing shoe materials in Binh Duong Province. — VNA/VNS Photo Hong Dat
Disbursement of foreign investment in the first half of this year reached over US$10 billion, up 1 per cent year-on-year, the Ministry of Planning and Investment's Foreign Investment Agency (FIA) announced on Thursday.
Director of the FIA Do Nhat Hoang said the increase in the disbursement rate showed the efficiency of the Government’s efforts to support businesses in implementing projects.
According to the agency, Viet Nam attracted $13.43 billion worth of foreign investment in H1, a decrease of just 4.3 per cent year on year, lower than the 7.3 per cent downturn over the last five months.
It added that newly-registered capital in the first six months increased 31.3 per cent to $6.94 billion, compared to 27.8 per cent in the five months of the year and 11.1 per cent in four months. Notably, the number of new foreign-invested projects totalled 1,293, representing a remarkable rise of 72 per cent year-on-year.
The growth of the number of new projects was much higher than that of investment capital, which demonstrated that small and medium-sized foreign investors continued to believe in the country's investment environment, the FIA has said.
New foreign-invested projects were still concentrated in provinces and cities offering advantages to attract foreign investment including good infrastructure, stable flows of human resources, efforts to reform administrative procedures and effective investment incentives. Among these localities were Ha Noi, Bac Giang, HCM City, Binh Duong, Dong Nai, Bac Ninh and Hai Phong.
During the period, the country allowed 632 operating projects to raise their capital by nearly $2.93 billion, up 30 per cent in volume but down 57 per cent in value.
Hoang noted the number of operating projects which saw capital added increased sharply in six months compared to 23 per cent in five months, 19.5 per cent in four months, 2.6 per cent in three months and a slump of 6.3 per cent in two months. That confirmed investors' confidence in Viet Nam's investment environment and continued to expand their existing projects in the country.
At the same time, foreign investors also poured in more than $4 billion in capital contributions and share purchase deals, a yearly hike of 76.8 per cent.
Singapore, Japan, China, South Korea, Taiwan (China) and Hong Kong (China) accounted for 76.1 per cent of the country's total investment capital in January-June.
Of them, Singapore ranked first with over $3 billion, equivalent to 22.3 per cent of the total, ahead of Japan with around $2.21 billion or 16.4 per cent, and mainland China with nearly $1.95 billion or 16.4 per cent.
The manufacturing and processing sector attracted the lion's share of foreign investment with over $8.46 billion, making up 63 per cent of the total. It was followed by banking and finance with over $1.53 billion or 11.4 per cent.
The real estate and science and technology sectors were the runner-ups with $1.53 billion and $631 million, respectively.
Experts predicted that the flows of foreign investment into Viet Nam would likely increase in the second half of the year as the economy has seen an uptick in recent months.
According to Hoang, many large-scale firms are showing interest in Viet Nam. But some remain cautious in making final decisions.
Meanwhile, investors from Taiwan (China) were flocking to Viet Nam, especially in the fields of electronics, technology and electric vehicles. Chinese firms were also establishing new production facilities outside the country to make full use of the host countries’ advantages.
Chinese investors have also flocked to Viet Nam following the country's reopening. In the first six months, China ranked first in the number of new projects, accounting for 18 per cent of the total.
Polytex Far Eastern Vietnam Ltd from Taiwan (China) planned to invest an additional $250 million in Viet Nam in the third quarter of 2023, raising its total investment to over $1 billion, vietnamplus.vn reported.
According to the online newspaper, Cheng Loong, also from Taiwan (China), is implementing the second phase of its US$1 billion project in Viet Nam.
Xiamen Hithium Energy Storage Technology and Growatt New Energy, both from China, are also reportedly considering investing a total of US$1 billion in Viet Nam.
Earlier this week, the People's Committee of Hai Phong City approved LG Innotek for additional capital of US$1 billion from 2023-25, raising the company's total investment to over US$2 billion. — VNS