FDI in 2011 and forecast of 2012

Jan 5th, 2012

Tuan Nguyen, ANT Consulting

Foreign Investment Agency has informed in a year-end press conference that FDI (foreign direct investment) in 2011 has reached USD 11 billion, equal to the year 2010. Compared with the target to attract USD 20 billion in foreign investment set for 2011, the actual number has not been met. However, a bright note is that although the registered capital was reduced, significant movement in a positive direction is seen. There has been a change in the structure of the investment with registered capital of 76.4% in 2011 to focus on industry and construction, much higher than the proportion of investment in this sector in 2010 (54.1%). In contrast, FDI in real estate in 2011 only accounted for 5.8% of total registered capital, while in 2010, this sector accounted for 34.3%.

This view is also supported by the data on production and business of this sector. Total exports of FDI sector, including crude oil reached USD 54.5 billion, accounting for 59% of total exports of the country, up 39% compared to 2010. The value of imports of FDI sector reached USD 47.8 billion respectively, up 38% over the previous year. Thus, the FDI sector has a trade surplus of about USD 6.7 billion (including oil), or USD 600 million deficit (excluding oil).

Until the date of Dec 15th, 2011, Vietnam has a total of 13,667 projects with total registered capital of USD 198 billion, in which industry and construction accounted for 54%. Singapore is the largest investor in Vietnam with total registered capital of USD 24 billion, followed by Korea, Japan and Taiwan. HCM City is still the leading provinces in attracting FDI with USD 32.67 billion, followed by Ba Ria – Vung Tau, Hanoi, Dong Nai and Binh Duong.

In the future, the management of the FDI will be geared towards improving the quality and enhancing efficiency, effectiveness of the projects. In the meantime, FDI projects will be attracted selectively with focus on the areas of infrastructure, ‘green’ technology, areas with competitive edge, high-tech sector, and involves training of human resources which add value to the global and regional supply chain.

It is expected to attract USD 15-16 billion in 2012 and disbursed U.S. $ 10-11 billion.

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