Thursday, November 01, 2007

Vietnam 6th most attractive investment destination in world

Golden investment days are dawning

Vietnam’s investment planners are forecasting a massive surge in the foreign direct investment capital on the back of the country’s recent diplomatic successes.

Heavy-weight investor are turing promising talk into reality
At an investment promotion workshop in Hanoi last week, Phan Huu Thang, chief of the Ministry of Planning and Investment’s Foreign Investment Agency (FIA), said Vietnam’s new role as non-permanent member of the United Nations Security Council, as well as its position as sixth most attractive investment destination in the United Nations Conference on Trade and Development (unctad) rankings would be milestones in attracting future foreign direct investment.
According to a survey conducted by the Asian Business Council, Vietnam ranked third for investment attraction among Asian nations in the 2007-2009 period, after China and India.
In a report released in July by the world’s largest business consulting group, PricewaterhouseCoopers, Vietnam was ranked among the top 20 newly emerging economies for investment in production. China was ranked second.
“I have confidence that Vietnam’s newly-registered FDI capital this year will exceed $13 billion - a significant rise from the previously planned $11-12 billion. In parallel, the FDI disbursement rate is also much better than ever before,” he said.
South Korean firm Posco’s $1 billion steel project in the south and E-United and Taiwan Steel’s $3.3 billion steel complex in the centre partly back the FIA chief’s statements.
FIA figures indicate that Vietnam received $11.26 billion in newly-pledged and extended FDI capital between January and October of this year, up 36.4 per cent over the same period last year. Meanwhile, the actual capital disbursed rose 18.7 per cent year-on-year to $3.7 billion.
Korea’s Trade-Investment Promotion Agency (Kotra) applauded Vietnam’s potential in FDI.
“Vietnam’s economy will grow dynamically in the coming years. WTO accession and the Korea-Asean Free Trade Agreement will draw more attention. More and more Korean investors are thinking of Vietnam as a promising destination for their capital,” said a Kotra representative.
“Low manufacturing costs, geographical location and political stability are Vietnam’s forte,” he added.
According to Kotra figures, as of September this year, Korea was the leader in terms of FDI in Vietnam with a total registered capital of $11 billion in 1,635 projects. In 2007 alone, Korea will register an estimated $2.1 billion, three times more than in 2005, thereby maintaining its top position among foreign investors. Similarly Japan, among the top-five foreign investors in Vietnam, has seen FDI surge in the last seven years. Figures released by Japan’s Mizuho Corporate Bank at the workshop showed that Japanese investment in Vietnam rose from $81 million in 2000 up to almost $1.1 billion last year.
“The reasons for the sharp rise in Japanese investment in Vietnam are increased risks in investment in China, increased production costs in Vietnam’s neighbours,” said Toshihiro Mitsui, general director of the bank’s headquarters in Vietnam.