Exploring new markets to draw more FDI to Vietnam

Illustrative image (Photo: VNA)

While the investment flow from traditional partners has shown signs of slowing down, the exploration of new markets will help Vietnam maintain success in attracting foreign investment.

During the first eight months of 2021, foreign investment registered in Vietnam, at 19.12 billion USD, continued to decrease, but the reduction was less than 2 percent from the same period last year, reported the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment (MPI).

The Republic of Korea (RoK), Japan, and Singapore remained the largest investors.

The RoK continually topped the countries and territories investing in Vietnam for years, followed by Japan and Singapore.

However, since the COVID-19 pandemic appeared, Singapore has replaced the RoK in this top position. It registered nearly 9 billion USD of investment in Vietnam in 2020, accounting for 31.5 percent of total foreign investment in the country. The respective figures were over 6.2 billion USD and 32.5 percent during January - August this year.

Japanese enterprises channeled 3.2 billion USD into Vietnam so far this year, making up 16.8 percent of the total and rising 94.9 percent year on year. Meanwhile, the RoK’s registered investment fell 17.8 percent to over 2.4 billion USD, equivalent to 12.7 percent of the total, statistics show.

Those three countries are expected to continue to lead the investment flows into Vietnam, according to FIA experts.

It is noteworthy that an investment project worth more than 1 million USD from Albania was registered in August. Though Albania is not a major economy in Europe, that a new European investor pays attention to Vietnam despite the COVID-19 pandemic, which is taking its toll on global investment flows, is an encouraging sign and also a demonstration of the country’s attractiveness, according to the Dau tu (Vietnam Investment Review) newspaper.

Facing a downturn in the foreign investment inflow, the FIA pointed to the complex COVID-19 situation in large investment partners of the country, underlining the need to tap into new markets.

Given this, the MPI and the Ministry of Foreign Affairs recently held a webinar on investment cooperation with the Middle East.

MPI Deputy Minister Nguyen Thi Bich Ngoc said the Middle East is always viewed as a potential region for investment cooperation, but its investment in Vietnam remains modest and has yet to match potential.

Though 13 of the 16 Middle East countries have invested in Vietnam, the number of their projects here stands at only 136, worth 917 million USD in total.

Opportunities are still ahead when Middle East countries are stepping up overseas investment, she said, suggesting studying cooperation with third partners to make major investments in Vietnam and connect the region’s big investment funds with large infrastructure projects in the country./.