Trading partners: Vietnamese Prime Minister Pham Minh Chinh (centre, right) greets South Korea’s Trade, Industry and Energy Minister Ahn Duk-geun at a forum in Seoul. South Korea is among the leading nations investing in the Vietnamese economy. — AFP
HANOI: Foreign investment disbursements in the first half of this year (1H) reached an estimated US$10.84bil, surging 8.2% year-on-year and establishing a record high over the past five years, according to the General Statistics Office (GSO).
The manufacturing and processing sectors attracted the largest share of disbursed foreign investment of US$8.6bil, accounting for 79.3% of the total.
Real estate followed with US$1bil, equivalent to 9.3% of the total, while production and distribution of electricity, gas, hot water, steam and air conditioning accounted for US$418mil, or 3.9%.
The GSO said that foreign investment inflows into Vietnam during the reviewed period also saw a positive increase of 13.1% year-on-year, to nearly US$15.19bil.
Foreign investors registered nearly US$9.54bil in 1,538 new projects, up 47% in capital and 19% in project number compared to the same time last year.
Meanwhile, 592 projects had their capital adjusted up, worth a total of US$3.95bil, down 6.3% and up 35% year-on-year, respectively.
Capital contributions and share purchases fell 57.7% year-on-year to US$1.7bil.
The department said that foreign investors injected their capital in 18 out of 21 economic sectors in the country in the past six months.
The processing and manufacturing industry attracted the largest investment of US$10.69bil, or 70.4% of the total, followed by real estate (over US$2.47bil), wholesale and retail sales (US$614mil) and science and technology (over US$452mil).
Weighing in with nearly US$5.58bil, Singapore was the largest investor in the country, accounting for around 36.7% of the total and represented an annual growth surge of 86%.
Japan came next with more than US$1.73bil, or 11.4% of the total.
Hong Kong, South Korea and mainland China coming after that.
However, mainland China ranked first in the number of new foreign projects, accounting for 29% of the total licensed in Vietnam in the first half, the GSO noted.
It added that foreign investors funnelled their capital into 48 cities and provinces across the nation.
Of these, Bac Ninh took the lead with US$2.58bil. In the second and third were Ba Ria-Vung Tau and Quang Ninh, with capital outlays of US$1.54bil and US$1.36bil.
According to experts, the shift in global production chains, especially in core technologies, chip manufacture, and future technology industries, is opening up many new opportunities for Vietnam to attract high-tech foreign investment.
Vietnam Investment Promotion and Associates Corp chief executive officer Nguyen Dinh Nam agreed. He said there were also many challenges facing Vietnam as it competes with other countries in the region.
Among them are insufficient incentives and support mechanisms for large projects and others in core and source technology, inadequate personnel resources, especially in new technology industries, chips, semiconductors, and artificial intelligence, and energy infrastructure and electricity shortages in some large industrial centres.
The supply chain and capacity of domestic supporting enterprises remain weak compared to other countries in the region, so there is a lack of connection between local enterprises and foreign enterprises, Nam said.
To attract high-quality foreign investment, Nam suggested Vietnam draw up more preferential policies and offer support in corporate income tax for high-tech and source technology projects, especially those in semiconductor chip production.
The country should also speed up administrative reforms to better facilitate foreign investors in addition to focusing on high-quality workforce training and ensuring the development of infrastructure systems, especially transportation connecting airports, seaports, large cities, and provinces with industrial centres, he said.
Nam also mentioned the importance of upgrading energy infrastructure and facilitating the implementation of renewable energy projects that meet the standards and production requirements of high-tech projects and protect the environment.
Qualipro Construction JSC deputy general director Vu Chi Kien said that the infrastructure of industrial zones plays an important role in attracting foreign investment. — Viet Nam News/ANN
