Ready to receive FDI capital

According to experts, there are currently four most important groups of factors that investors consider when choosing a country or economy to invest in. These are: Investment efficiency; comparative advantages in terms of labor, natural resources, domestic market, etc.; trust in strategy, politics, and finally risk management and economic resilience.

Compared to the above groups of factors, Vietnam has many favorable conditions to attract foreign direct investment (FDI). Vietnam has signed many bilateral and multilateral trade agreements; sea, air and maritime connections are quite good. Along with that, Vietnam is also making efforts for digital transformation, green transformation, and catching up with the trends of the 4th Industrial Revolution.

Appropriate policies are needed to support domestic enterprises to participate.
export value chain

It can be seen that Vietnam is considered by international investors as an attractive and safe destination and is welcoming a wave of investment, especially in the fields of technology, electronics, and semiconductor manufacturing. It is forecasted that FDI capital into Vietnam in 2024 will continue to increase, equal to or higher than in 2023.

Ms. Phi Thi Huong Nga, Director of the Department of Investment and Construction Statistics (General Statistics Office) said that in 2023, Vietnam attracted 26.6 billion USD of registered FDI capital, an increase of 32.1% compared to the same period last year. The amount of FDI disbursement in 2023 was also very impressive, reaching about 23.1 billion USD, much higher than in recent years. FDI investors have also poured capital into Vietnam with a series of projects ranging from several hundred million to billions of USD.

According to data from the Foreign Investment Agency - Ministry of Planning and Investment, as of March 20, 2024, the total newly registered, adjusted and contributed capital for share purchase by foreign investors reached more than 6.17 billion USD, an increase of 13.4% over the same period in 2023; the realized capital of foreign investment projects is estimated at about 4.63 billion USD, an increase of 7.1% over the same period in 2023.

Recently, Fitch Ratings - an international credit rating organization - upgraded Vietnam's national credit rating to BB+ with a stable outlook, while also emphasizing that Vietnam has an advantage in attracting FDI thanks to its positive economic outlook.

The representative of the General Statistics Office shared that FDI capital flows into Vietnam will continue to grow well in 2024 and the following years. In parallel, foreign investors' confidence is reinforced by stable macroeconomic policies, Vietnam's open and safe investment environment; the Government also always accompanies and supports the business community to overcome difficulties, stabilize and develop production and business; many fiscal and monetary policies to support businesses are effectively implemented.

Mr. Phan Duc Hieu, Standing Member of the National Assembly's Economic Committee, shared that improving the investment and business environment is the best and most effective solution for Vietnam to cope with negative impacts and take advantage of opportunities from the global minimum tax policy in the short and long term.

He also emphasized that a long-term vision is needed if Vietnam wants to attract investment. It needs to have a business environment that is more competitive than other countries. Therefore, it is necessary to implement more drastic and effective programs to improve the business environment; simplify administrative procedures and business conditions, help reduce costs and burdens of administrative procedures, comply with transparent laws as well as reduce risks, thereby increasing Vietnam's attractiveness to foreign investors.

Mr. Nguyen Van Toan, Vice President of the Association of Foreign Investment Enterprises (Vafie), also emphasized that Vietnam's opportunities to attract FDI are wide open. Factors such as the "battle" to control core technology, chip technology, and future technology are opening up opportunities for Vietnam to attract high-tech FDI. The imposition of global minimum tax also brings benefits to Vietnam, helping to solve the problem of transfer pricing in FDI investment activities. At the same time, Vietnam needs to have appropriate support policies so that domestic enterprises can participate in the export value chain of FDI corporations in segments with higher technology and value than at present.

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