Foreign investment in Vietnam may reach $28 billion by end of 2017
By the end of 2017, Vietnam will see soaring foreign investment capital, reaching $28 billion with an expected record in disbursed FDI capital of $17 billion.
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| Vietnam is looking at a potential new record in foreign investment inflows |
Soaring foreign investment capital
In
its report submitted to the 12th Communist Party of Vietnam Central Committee’s
sixth plenary meeting organised on October 4, the Ministry of Planning and
Investment reported that in the nine months of this year, the country attracted
$25.48 billion of foreign investment capital, including foreign indirect and
direct investment capital, which was considered a spotlight of the 2017
socioeconomic indicators.
Besides,
the expected figure of $28 billion for the whole year was mentioned in MPI’s
report, a surprisingly strong growth in recent years.
Along
with the increase in registered capital, disbursed capital for the whole year
will also reach strong growth. Notably, in 2017, the disbursed capital is
expected to reach $20 billion, $3 billion of which come from foreign investors’
M&A deals or foreign indirect investment capital.
The
remaining $17 billion come from FDI capital, signifying an increase of 7.5 per
cent on-year and 9.6 per cent higher than expectations. If the expected $17
billion in disbursed capital comes through, it will create a record to date. In
2016, the figure was $15.8 billion.
In
the nine months of this year alone, $12.5 billion was disbursed, up 13.4 per
cent on-year.
According
to Nguyen Mai, chairman of the Vietnam Association of Foreign Invested
Enterprises, in recent years, one factor attracting FDI capital was that along
with the strong growth in registered capital, the gap between registered and
disbursed capital has been narrowed down.
In
the list of billion-dollar projects registered in these nine months, the added
$2.5 billion capital from Samsung has already been disbursed. As of late March,
Samsung registered to invest $17.3 billion in Vietnam, $12.5 of which has been
disbursed.
According
to the Ministry of Industry and Trade (MoIT), in the first nine months of the
year, the import turnover soared due to the increased disbursement of FDI
capital, including Samsung Display and Formosa, to import machinery and
equipment.
All
of the above figures show that Vietnam is really an ideal investment
destination for foreign investors looking to invest and expand their
operations.
Golden opportunity for Vietnam
As
numerous countries in Asia are experiencing political instability, Vietnam is
becoming an attractive investment destination due to its long-standing
stability and great potential for economic development as well as the
continuously improving business environment.
Especially,
Vietnam’s hosting of the Asia-Pacific Economic Co-operation (APEC) 2017 is considered
a golden opportunity for Vietnam to promote co-operation with APEC economies,
almost all of which are Vietnam’s leading partners, including Japan, South
Korea, the US, China, Thailand, and Taiwan.
After
hosting APEC 2006, Vietnam became a magnet to FDI capital, peaking in
2007-2008. The country hopes to recreate the achievement with APEC 2017.
According
to Philip Falcone, chairman of Harbinger Capital Partners from the US, which
has poured a massive amount of money into Grand Ho Tram Strip (Ba Ria-Vung Tau
province), the presence of US President Donald Trump at the APEC Economic
Leaders’ Week will bring large-scale investment opportunities and help Vietnam
and the US promote investment co-operation. Besides, US investors will also
step up investments in Vietnam.
At
the recent meeting between CEO of Samsung Group Shin Jong-kyun and Prime
Minister Nguyen Xuan Phuc, Shin Jong-kyun affirmed that along with the $17
billion registered capital in existing projects, Samsung plans to pour capital
in other sectors, including telecommunications, as well as power plant,
airport, and shipbuilding development.
These
movements show that FDI capital will continue to flow into Vietnam.
According
to MPI’s expectations, in 2017, Vietnam will lure in $27.5-28.5 billion in
registered foreign investment capital, with the total disbursed capital
reaching $21 billion. $17.5 billion of the disbursed capital will come in the
form of FDI, and the remaining $3.5 billion from M&A deals.
"Source: Vietnamnet"
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