In terms of investment capital, Singapore is the leader, but in terms of the number of new investment projects, China is the leading investor. Chinese investors are still accelerating their investment in Vietnam.
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| May recorded the largest amount of adjusted and increased investment capital in the first months of 2024. Photo: Duc Thanh |
Which investor is holding the "throne"?
Foreign investment attraction continues to be on a positive trend, one of which is that in May 2024, new investment capital and additional capital were almost equal. According to the Foreign Investment Agency (Ministry of Planning and Investment), May 2024 recorded the largest amount of adjusted and additional investment capital in the first months of 2024, 2.8 times higher than April, up 72% compared to March, 4.1 times higher than February and more than 3.6 times higher than January 2024.
“Although the total adjusted investment capital in the first 5 months of the year still decreased compared to the same period in 2023, the decrease has gradually improved, increasing by 16.9 percentage points compared to the first 4 months of 2024. In the first 5 months, the adjusted investment capital decreased by only 8.7%, lower than the decrease of 25.6% in 4 months and 22.6% in 3 months,” said Mr. Do Nhat Hoang, Director of the Foreign Investment Agency.
The acceleration of adjusted capital in May 2024 contributed significantly to bringing the total registered foreign investment capital in the first 5 months to over 11.07 billion USD, up 2% over the same period in 2023. Of this, there was 7.94 billion USD from 1,227 new projects, up 50.8% in capital and 27.5% in number of projects over the same period last year. The remainder included 2.08 billion USD of adjusted capital, down 8.7% over the same period; and 1.05 billion USD of investment capital through capital contribution and share purchase, down 68.2% over the same period last year.
This figure is considered by Mr. Nguyen Van Toan, Vice President of the Association of Foreign Investment Enterprises, as “quite positive”, showing that Vietnam is still highly appreciated by international investors. However, according to Mr. Toan, this figure does not show a “leap forward”, especially after American and European investors expressed interest in investing in semiconductor and artificial intelligence (AI) projects in Vietnam.
Figures from the Foreign Investment Agency show that in the first five months of the year, US investors have registered to invest more than 90 million USD in Vietnam, a very modest figure. “The largest investment partners in the first five months of the year are all traditional partners of Vietnam and come from Asia,” commented Mr. Do Nhat Hoang.
According to the Foreign Investment Agency, in the past 5 months, Singapore has held the "throne" among the countries and territories with the largest investment in Vietnam, with nearly 3.25 billion USD, accounting for 29.3% of total investment capital, up 28.2% over the same period in 2023. Followed by Hong Kong, Japan, China, and South Korea. These 5 partners alone account for 73% of new investment projects and 73.5% of the total registered investment capital of the country.
It is worth noting that, although Singapore leads in terms of registered capital, in terms of the number of new investment projects, China is the leading partner (accounting for 28.3%); while South Korea leads in the number of capital adjustments (accounting for 24.1%) and capital contributions and share purchases (accounting for 26.3%).
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| China is the partner accounting for over 28% of new foreign-invested projects in Vietnam in the first 5 months of 2024. |
China accelerates investment in Vietnam
In the general trend of foreign investment in Vietnam, one point that cannot be ignored is that Chinese investors have recently accelerated their investment in Vietnam. This trend is probably much stronger since last year, after China abolished its Zero Covid policy.
Perhaps, the projects that Minister Nguyen Chi Dung wants to mention are the hundreds of millions of USD projects, even up to billions of USD of Goertek, BYD, then the Radian tire projects, Brotex fiber production...
In 2023, Chinese investors registered to invest in Vietnam up to 4.47 billion USD, an increase of 77.6% compared to 2022. In addition, 707 new projects, 179 capital adjustment projects and 412 capital contributions and share purchases were registered by Chinese investors in Vietnam.
Meanwhile, in the first 5 months of this year, the number was 347 new projects, 55 capital adjustment projects and 172 capital contributions and share purchases, with a total registered capital of 1.126 billion USD, ranking 4th among countries and territories with large investments in Vietnam.
In the Provincial Competitiveness Index (PCI) and Provincial Green Index (PGI) 2023 Ranking Report, the Editorial Board devoted a separate section to the investment trends of Chinese investors. Specifically, since 2019, in the context of the tense trade relations between China and the United States and the slowing growth of China's economy, Chinese investors have begun to seek opportunities in Vietnam. Accordingly, the investment capital flow from China to Vietnam increased sharply from 2.92 billion USD in 2021 to 4.47 billion USD in 2023.
However, according to Mr. Dau Anh Tuan, Deputy General Secretary and Head of the Legal Department of the Vietnam Federation of Commerce and Industry (VCCI), the wave of investment from China has also raised concerns about the quality of foreign investment in Vietnam, as well as its impact on Vietnam's environmental and energy standards. The risk of Chinese investors investing in Vietnam to avoid the origin of goods has also been mentioned for a long time.
However, the Vietnamese Government still strongly encourages and hopes that Chinese investors will increase their investment in Vietnam. According to Minister of Planning and Investment Nguyen Chi Dung, with the goal of selectively attracting investment, creating widespread connections between the foreign investment sector and the domestic economic sector, promoting the strong development of the digital economy, green economy, circular economy, and knowledge economy, Vietnam welcomes Chinese investors to invest in areas such as high technology, renewable energy, supporting industries, electronic components, electric cars, electric batteries, essential infrastructure, forming international financial centers, green finance, smart cities, ecological industrial parks, free trade zones, etc.
“These are industries and fields in which China has experience and strengths, and Vietnam has demand and development potential,” said Minister Nguyen Chi Dung, expressing his hope that Chinese investors will pay attention, increase cooperation, transfer technology, improve production capacity, and bring Vietnamese enterprises deeper into the global commodity value chain.
Source: https://baodautu.vn/trung-quoc-tang-toc-dau-tu-vao-viet-nam-d216256.html
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