Following the recovery momentum from the end of 2021 after the impact of the Covid-19 pandemic, many FDI enterprises have stabilized and expanded their production, business activities, according to a report by the Foreign Investment Department, Ministry of Planning and Investment,
In January 2022, Vietnam attracted registered FDI valued at 2.1 billion USD, up 4.2% over the same period last year. Realized FDI in the month also reached 1.61 billion USD, up 6.8% over the same period last year. That is a positive signal for FDI inflows into Vietnam in 2022, and affirming Vietnam’s stability in the competition to attract FDI.
Notably, among the investment projects at the beginning of the year, there were large-scale projects. Typically, on February 16, 2022, Samsung Electro-Mechanics Vietnam Co., Ltd. was officially awarded an project investment expansion certificate with an additional capital of 920 million USD in Thai Nguyen province. Previously, the Goertek Group (Hong Kong, China) project of Factory for manufacturing electronic products, network equipment and multimedia audio products at WHA Industrial Park in Nghe An, was adjusted to increase investment capital by 260 million USD to expand production scale, invest in high-tech production lines.
In addition, in Bac Ninh province, there is also another hundred million USD capital adjustment project, which is a commercial and service project GE Vietnam (Korea) adjusted to increase investment capital by 216.9 million USD. Or in Phu Tho, the electronic component factory project (JNTC – Korea) also adjusted to increase investment capital by 163 million USD to expand the production line of tempered glass for car and watch screens, cover glass for camera…
According to the Foreign Investment Agency, Vietnam is expected to attract South Korea – based electricity, electronics, and manufacturing producers who is looking for production facilities to export in new markets. Vietnam continues to attract much attention from Japanese investors in the fields of wholesale, retail, non-manufacturing, supporting industries and is an important destination for many Taiwanese (China) businesses with annual committed capital accounting for one-third of the total investment capital that investors from this territory commit to the ASEAN region.
In addition, Vietnam will have the opportunity to attract from the shift of FDI inflows from the European region in fields of technology, pharmaceuticals, and energy. Nearly 90% of German enterprises participating in the survey intend to continue to maintain their investment in Vietnam, even about half of them plan to expand their investment in the Vietnamese market.
Growth expectations
South Korean Ambassador to Vietnam Park Noh Wan, sharing at the meeting with leaders of Ho Chi Minh City in early 2022, said that the anti-epidemic and development policy Economic development of the Government of Vietnam is on the right track, bringing positive effects. Many recommendations of the Korean investor community in Vietnam have been seriously considered, implemented and implemented by the Ho Chi Minh City government.
This is the reason why more and more Korean businesses choose Ho Chi Minh City as a destination to develop their businesses and it is forecasted that Korean enterprises will continue to increase investment in Ho Chi Minh City in the coming time. To prepare for effective investment connection activities, Korean businesses have planned to hold an investment – trade – technology promotion seminar in Ho Chi Minh City in June 2022. Currently, there are 50 Korean businesses registered to Ho Chi Minh City looking for trading opportunities.
Similarly, in 2021, despite being negatively impacted by the Covid-19 epidemic, foreign investors continue to be confident and optimistic about the province’s business investment environment in Binh Duong. Binh Duong continues to be a bright spot in attracting FDI in the country with nearly 2.7 billion USD in 2021, exceeding 48% of the plan, up 36% over the same period last year.
Mr. Mai Ba Truoc, Director of Binh Duong Department of Planning and Investment, said that FDI has been making a great contribution to the economic development of the province. In the province, more and more large-scale projects are in line with the defined investment attraction guidelines.
In particular, the most recent project is a synthetic fiber production project of Polytex Far Eastern Co., Ltd. in Bau Bang Industrial Park with an additional registered investment capital of 610 million USD, lead to the total investment capital up to 1.37 billion USD. Besides, Lego Group started the construction of a new 44-hectare factory in Binh Duong with an investment of 1 billion USD, which is expected to come into operation in 2024. This shows that Binh Duong has been and is really is a good location for foreign investors.
Although the opportunity to receive FDI is huge, according to experts, the competition to attract FDI is increasingly fierce, especially in the context of limited capital supply and the heavy impact of the Covid-19 pandemic. All countries are taking advantage of attracting external resources to maintain and restore the economy. Therefore, competition to attract FDI among developing countries with similarities in market, development level, technology and labor is increasingly fierce.
Therefore, according to the MPI, Vietnam needs to prepare necessary conditions to attract FDI such as reviewing and supplementing the “ready” land fund; review the electricity planning; training high-quality human resources; supplementing policies to develop supporting industries; develop regulations and standards as a new filter to select FDI investors with advanced technology, able to withstand external pressure for sustainable development and national security.
