Ho Chi Minh City’s foreign investment competitiveness index has dropped sharply compared to other localities. However, the number of FDI projects in the field of science and high technology in Ho Chi Minh City is still dominant.
According to the research team of the Banking University of Ho Chi Minh City, in recent years, Ho Chi Minh City is no longer the leading locality in the country in attracting foreign direct investment (FDI). Specifically, the proportion of FDI capital of Ho Chi Minh City in the total FDI capital of the country has decreased from 22% in 2019 to 11% in 2023.
Not only has its ability to attract FDI declined, Ho Chi Minh City is also facing difficulties in attracting large-scale FDI projects. During the years 2017 - 2022, Ho Chi Minh City only attracted 3 projects with a scale of 300 - 841 million USD. Meanwhile, other localities such as Quang Ninh, Hai Phong, Bac Giang, Binh Duong, Long An all attracted projects with a total registered investment capital of 1-3 billion USD.
Experts say that, in addition to objective reasons from negative impacts of the economy, Ho Chi Minh City itself has also gradually lost its competitive advantage compared to other provinces and cities across the country in attracting FDI.
Accordingly, compared to centrally-run cities such as Hanoi, Hai Phong, Binh Duong and two prominent bright spots attracting FDI, Bac Giang and Quang Ninh, the provincial competitiveness index (PCI) ranking of Ho Chi Minh City is currently falling sharply and becoming increasingly inferior.
While Quang Ninh continuously leads the national PCI rankings in the 2017-2022 period, Bac Giang rises from 30th to 2nd place, Hai Phong from 9th to 3rd place, Ho Chi Minh City drops sharply from 7th place in 2017 to 27th place in 2022.
“The continuous downgrade in the PCI rankings shows that Ho Chi Minh City has not made appropriate changes in the quality of economic management, the level of convenience and friendliness of the business environment and administrative reform efforts. In addition, the limited land fund for implementing large-scale projects is also a bottleneck that prevents Ho Chi Minh City from attracting billion-dollar projects,” said the report of the research team of the Ho Chi Minh City Banking University.
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| Although it has not attracted many large-scale FDI projects, Ho Chi Minh City is still a locality where many foreign corporations invest in the high-tech sector. |
It is known that although the competitiveness in attracting FDI is decreasing, Ho Chi Minh City is still the locality attracting the most FDI projects in the fields of digital technology, semiconductors, and biotechnology.
According to the Ho Chi Minh City Statistics Office, in 2023, 50 FDI projects in Ho Chi Minh City registered for increased investment related to scientific and technological activities, with a total registered capital of about 290 million USD. In addition, the locality attracted an additional 278 million USD from FDI enterprises contributing capital to buy shares related to scientific and technological activities.
To date, Ho Chi Minh City High-Tech Park still has about 51 valid FDI projects with a total investment capital of more than 10 billion USD. The export turnover of high-tech products of this Center alone in 2023 will reach about 26 billion USD, an increase of more than 3 billion USD compared to 2022.
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