As of the end of August, total registered Foreign Direct Investment (FDI) in Vietnam saw a slight decline of just over 2% year-on-year, a significant recovery compared to the 11% drop recorded in the first seven months of the year.
The Ministry of Planning and Investment (MPI) recently released data on foreign investment in Vietnam. As of August 20, the total registered capital, including newly registered capital, adjusted capital, and capital contributions or share purchases by foreign investors, reached $19.12 billion, a 2.1% decrease compared to the same period in 2020.
According to regulatory authorities, newly registered capital maintained its growth momentum, and adjusted capital saw a slight rebound after a seven-month decline. Only capital contributions and share purchases continued to trend downward.
Specifically, 1,135 new projects were granted investment registration certificates. While this represents a nearly 37% decrease in the number of projects, the total registered capital reached nearly $11.33 billion, a 16.3% increase. Additional registered capital (adjusted capital) also hit nearly $5 billion, up 2.3%. In contrast, capital contributions and share purchases by foreign investors in Vietnamese enterprises plunged by over 43%, totaling only $2.8 billion.
By investment sector: The processing and manufacturing industry led the way with total investment of nearly $9.3 billion, accounting for 48.4% of total registered capital. Electricity production and distribution ranked second with nearly $5.5 billion (28.7%), followed by real estate and wholesale/retail with nearly $1.6 billion and over $734 million, respectively.
By investment partner: Singapore led with total investment of over $6.2 billion, followed by Japan with $3.2 billion. Investment from Singapore and Japan was primarily through new projects. According to the Foreign Investment Agency (FIA), Singapore’s top position in scale was driven by a single $3.1 billion project, which alone accounted for 50% of Singapore’s total investment in Vietnam over the first eight months.
South Korea ranked third with total registered capital of over $2.4 billion, down nearly 18% year-on-year. However, South Korea remained the leading partner in terms of both the number of new investment projects and the number of capital adjustment turns.
By investment location: Long An led the country with over $3.6 billion in registered capital, including a $3.1 billion power project (accounting for 85.8% of the province’s total). Ho Chi Minh City ranked second with nearly $2.2 billion, followed by Binh Duong with nearly $1.7 billion.
In terms of project numbers, foreign investors remained concentrated in major cities with favorable infrastructure, such as Ho Chi Minh City, Hanoi, and Bac Ninh. Ho Chi Minh City led in new projects (34%), capital adjustment turns (18.3%), and capital contributions/share purchases (59.8%). Although Hanoi did not place in the top five for total capital in the first eight months, it ranked second in new projects with 21.5%.
As of August 20, disbursed FDI was estimated at $11.58 billion, a 2% increase.
However, the Ministry of Planning and Investment noted that the complicated developments of COVID-19 led to the suspension or reduced capacity of several factories. Consequently, realized capital in August decreased by over 12% year-on-year and by 14.3% compared to July.
(Source: VnExpress)
