Monday, July 28, 2008

Strong FDI ‘sign of confidence’ in Vung Tau Vietnam


Workers assemble car engines at a Japanese-invested automobile factory. Foreign direct investment in the first seven months of this year hit a record high, double the figure for all of 2007. —VNS Photo

HA NOI — The country attracted US$45.28 billion in foreign direct investment (FDI) in the first seven months of the year, double the figure for all of 2007, according to a report by the Foreign Investment Agency.

The increase in FDI registered countered the negative perception of the Vietnamese economy, strongly expressing the confidence of foreign investors in the country’s investment climate, the report stated.

The agency also attributed the FDI growth to ongoing Government efforts, as relevant ministries and agencies promote investment and support investors seeking investment opportunities and implementing projects.

As many as 167 foreign-invested projects worth over $13.55 billion received licences in July, with an average capital of $68 million each, the highest level to date. The latest addition has brought the total number of licensed projects in the country so far this year to 654, capitalised at over $44.49 billion.

The figure reflects a decline of 24 per cent in the number of projects, but marks a 5.5 fold increase in the amount of investment capital.

The period also saw 188 projects raise their levels of investment capital by a combined $788.6 million, the report noted.

Major projects that contributed to the rise in FDI included the Taiwan group Formosa’s $7.9 billion steel complex in Ha Tinh Province’s Vung Ang Economic Zone, a $6.2 billion refinery project at Nghi Son Economic Zone in Thanh Hoa Province (a joint venture of Japanese, Kuwaiti and Vietnamese partners) and the $4.2 billion Ho Tram Tourism complex project financed by Canadian investors in Ba Ria-Vung Tau Province.

The previous trend of the majority of FDI going into the services sector continued, accounting for $22.84 billion, or 51 per cent, of total FDI for the period. Another $21.45 billion or 48 per cent of total FDI went into industrial and construction sectors, while the rest was in agro-forestry-fishery sectors.

Taiwan remained the top foreign investor in Viet Nam with 82 projects worth $8.4 billion. Japan came in second with 65 projects valued at $7.2 billion, and Malaysia was third with 28 projects capitalised at over $5 billion.

In the first seven months, FDI was mostly transferred out of Ha Noi and HCM City, the nation’s major economic hubs, to neighbouring provinces as the two cities were unable to provide large land areas for development. Ba Ria – Vung Tau has become the most attractive locality for foreign investors, bringing in 21 per cent of total registered capital. HCM City and the central Ha Tinh Province were next at 18 per cent, and Thanh Hoa followed at 14 per cent. — VNS