(VOVworld) – In the first two months of this year, Vietnam attracted 1.54 billion USD in 122 new foreign direct investment (FDI) projects. Although the figure is only about 37% of FDI in January and February of last year, the quality of the FDI projects has improved.

The Republic of Korea led 29 countries and territories investing in Vietnam so far this year, followed by Singapore, Japan, and the US. Foreign investors invested in 19 Vietnamese provinces and cities with the southern province of Binh Duong luring the most - 690 million USD in newly-registered capital. Then came the northern port city of Hai Phong - 195 million USD - and Ho Chi Minh City – 148 million USD. Most of the projects are in the field of high-tech manufacturing. Compared to FDI projects last year worth billions of USD, including Nghi Son oil refinery and Samsung Electronics, the figure is modest, but it shows a change in Vietnam’s policy to attract FDI capital, according to Nguyen Van Trung, Deputy Minister of Planning and Investment. Trung comments:

Nguyen Van Trung, Deputy Minister of Planning and Investment: from now on, Vietnam'll focus on projects with high tech value instead of luring FDI capital at any cost.

“In the future, we’ll focus on projects with high tech value instead of luring FDI capital at any cost. For example, with an oil refinery project, a series of related services with wide capacity will be launched. In other words, satellite enterprises will be set up auxiliary industries towards establishing several supplementary industrial zones.”

In recent years, FDI sources have been contributing to Vietnam’s economic growth. By the end of last year, Vietnam had nearly 15,700 projects under way with total registered capital of 239 billion USD. FDI projects have helped change the structure of export items. Professor Nguyen Mai, President of the Vietnam Association of Foreign Invested Enterprises, says

“Last year, Vietnam earned 132 billion USD from exports, 65% of that was contributed by FDI companies. They not only made up for the trade gap of domestic businesses, but recorded a trade surplus of 850 million USD for the second consecutive year. If the trend continues, Vietnam’s international balance of payments will be consolidated and Vietnam’s foreign currency reserve will double from the current level of about 16 billion USD.”

High-tech projects like Samsung electronics projects in Bac Ninh and Thai Nguyen province have demonstrated the spread of FDI capital from multinational groups into satellite enterprises and auxiliary industries for Vietnam. They not only increase tax revenues for the government and boost GDP growth, but also enhance socio-economic growth in various ways. The projects have given domestic consumers qualified products and changed Vietnamese people’s ways of thinking and working in production and trading. 

In recent years, many foreign investors have spoken highly of the remarkable improvements in Vietnam’s investment environment thanks to a stable macro-economy, preferential policies, and infrastructure. These favorable conditions will allow Vietnam to choose FDI flows of higher quality in the future.