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FDI attraction situation in Vietnam and Vietnam’s overseas investment in the first eleven months of 2023

Date 26/11/2023 - 16:44:00 | 2023 views
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As of November 20, 2023, the total newly registered capital, adjusted and contributed capital to buy shares and buy contributed capital of foreign investors reached approximately 28.85 billion USD, rising 14.8% year-on-year. The capital generated by FDI projects was estimated at 20.25 billion USD, up 2.9% over the same period in 2022.

Accumulated to November 20, 2023, the whole country has 38,844 valid projects with a total registered capital of 462.4 billion USD. The accumulated realised capital of foreign investment projects reached about 294.2 billion USD, equalling 63.6% of the total valid registered investment capital.

Details are as follows:

I. FDI INFLOWS OF VIETNAM

1. FDI attraction in the first eleven months of 2023

1.1. FDI performance:

Realised capital:

As of November 20, 2023, disbursement of FDI projects were estimated at about 20.25 billion USD, up 2.9% year-on-year and 0.5 percentage point as compared with the figure to the first ten months of this year.

Import and export performance:

Export: Export (including crude oil) was estimated at 237.16 billion USD, down 6.9% year-on-year, accounting for 73.3% of export turnover. Export (excluding crude oil) was 235.42 billion USD, decreased 6.8% from a year earlier, accounting for 72.8% of the country’s export turnover.

Import: Imports of the foreign-invested sector attained over 192 billion USD, down 11.1% over the previous period and accounting for 64.3% of the country’s import turnover.

Despite the decrease in export turnover in the first eleven months of 2023, the FDI sector saw a trade surplus of 45.4 billion USD including crude oil and nearly 43.4 billion USD excluding crude oil, while the domestic sector had a trade surplus of more than 20.4 billion USD.

1.2. Investment registration

As of November 20, 2023, the total newly registered capital, adjusted capital and capital contributions and share purchases of foreign investors stood at 28.85 billion USD, up 14.8% year-on-year and slightly increased of 0.1 percentage points as compared with the figure in the first ten months of this year. The newly registered capital and capital contributions and share purchases increased while adjusted capital continued falling.

Of which:

Newly registered capital: There were 2,865 projects worth 16.41 billion USD, were granted licenses, up 58.1% in number and 42.4% in value year-on-year.

Adjusted capital: There were 1,152 turns of project registering to adjust their investment (up 15.9% on-year) with a total additional capital of over 6.47 billion USD (down 32.1% year-on year).

Capital contribution and share purchases: There were 3,166 capital contribution and share purchases by foreign investors (down 4% year-on-year) with a value of nearly 5.97 billion USD (up 46.4% year-on-year).

(Detailed data in Appendix I attached)

By sector:

Foreign investors poured funds into 18 out of 21 sectors in the national economic classification system, of which the processing and manufacturing industry took the lead with over 20.97 billion USD, making up 72.71% of the total and increasing 40.2% year-on-year. Real estate came next with a total investment of over 2.87 billion USD, accounting for 10% of the total and falling 31.4% compared to the same period last year. Followed were banking and finance, and wholesale and retail, with nearly 1.54 billion USD (up 58.5 times more compared with the figure last year) and nearly 1.04 billion USD (up 12.9% annually), respectively.

It is also worth noting that processing and manufacturing was the sector with the largest number of newly-registered projects (32.9%) and capital adjustment (54.1%). Wholesale and retail led in the number of capital contribution and share purchases (accounting for 40.9%).

By counterpart:

There were 110 countries and territories investing in Vietnam in the first eleven months of 2023. Singapore remained Vietnam’s leading source of foreign investment with about 5.15 billion USD, making up 17.8% of the total FDI registered in the country (down 0.9% year-on-year). Hong Kinh (China) came second with over 4.33 billion USD, making up 15% of the total, and more than 2.2 year-on-year. Republic of Korea came third with a total registered investment capital of over 4.17 billion USD, accounting for 14.5% of the total and rising 1.2 times on-year. Next were China, Japan, Taiwan (China) and so on.

Regarding the number of projects, China led in terms of number of newly-registered projects (accounting for 22.1%); the RoK topped the list when it comes to turns of capital adjustment (26.2%) and capital contributions and share purchases (27.9%).

By location:

The foreign investors had invested in 56 provinces and cities nationwide in the first eleven months of 2023. Quang Ninh led the way with a total registered capital of nearly 3.11 billion USD, making up 10.8% of the total and increasing 42.3% from a year earlier. Ho Chi Minh city ranked second with over 3.08 billion USD, accounting 10.7% of the total and falling 12.9% compared with the figure in the same period last year. Followed by Hai Phong, Bac Giang and Hanoi.

Ho Chi Minh City remains the best performer in attracting new projects (38%), turns of adjusted projects (25.3%) and capital contributions and share purchases (66.6%).

(Detailed data in Appendix II attached)

2. Evaluation of the FDI performance in the first eleven months of 2023

- The realised capital of FDI projects increased 2.9% year-on-year and 0.5 percentage points compared with the figures of the first ten month this year. With the support of the Government and the Prime Minister and close coordination of ministries, sectors and localities in actively removing bottlenecks and legal barriers related to business and investment activities, enterprise have stabilised their business production.

- The total registered capital reached the highest growth for the first time since the beginning of this year, up 14.8% over the same period and up 0.1 percentage points compared to the ten months.

- Although newly registered capital declined by 11.6 percentage points compared to the figure of the first ten months because there are not many large-scale investment projects in November as in the previous month, it still maintained a surge of 42.4% over the same period.

Newly-invested projects are still focused on cities and provinces that have more advantages such as infrastructure, stable human resources, efforts to reform administrative procedures, and active investment promotion, like Ho Chi Minh City, Hanoi, Bac Ninh and Binh Duong. These four localities accounted for 67.4% of the country’s newly-registered projects in the first eleven months.

- Although the added capital decreased over the same period, the downturn has been improved. The number of  projects adjusting their capital still maintained a rise of 15.9% despite the decrease in capital, showing investors were confident in Vietnam’s investment climate so they decided to expand their projects.

- Asian and traditional investors accounted the most proportion (Singaporean, Hong Kong (China), South Korean, Chinese, Japanese and Taiwanese (China) ones). These six partners accounted for 81 % of total national investment capital in the first eleven months).

- Although export of the FDI sector decreased, it posted a trade surplus and offset the trade deficit of the domestic business sector. With a trade surplus of 45.1 billion USD (including crude oil) and 43.4 billion USD (excluding crude oil), the FDI sector offset the trade deficit of over 20.4 billion USD of the domestic business sector, helping the country have a trade surplus of about 24.7 billion USD.

3. Accumulated foreign investment as of November 20, 2023

Accumulated as of November 20, 2023, the whole country has 38,844 valid FDI projects with a total registered capital of 462.4 billion USD. The accumulated realised capital of FDI projects is estimated at 294.2 billion USD, equalling 63.6% of the total valid registered investment capital.

- By sector: Foreign investors have invested in 19 out of 21 sectors in the national economic classification system, in which the processing and manufacturing accounted for the highest proportion with over 280.5 billion USD, accounting for 60.7% of the total investment capital. It was followed by real estate sector with over 67.6 billion USD (representing 14.6%); electricity production and distribution with nearly 38.6 billion USD (or 8.3%).

- By counterpart: There are 143 countries having valid investment projects in Vietnam since Grenada has dissolved their only project. In which, the RoK ranked first with a total registered capital of over 84.1 billion USD (accounting for 18.2% of the total). Singapore ranked second with nearly 73.7 billion USD (representing for 15.9%). Next were Japan, Taiwan (China), and Hong Kong (China).

- By location: FDI has been present in all 63 provinces and cities nationwide, of which Ho Chi Minh City remains the leading province in attracting foreign investment with more than 57.25 billion USD (accounting for 12.4% of the total investment capital), followed by Binh Duong with more than 40.3 billion USD (or 8.7% of the total investment capital), Hanoi with over 39.58 billion USD (representing 8.6% of the total investment capital).

(Detailed data in Appendix III attached)

II. FDI OUTFLOWS OF VIETNAM

In the first eleven months of 2023, Vietnam’s total newly-registered and additional investment were about 395 million USD (equalling 83.3% year on year). Of which, 117 projects were granted new investment registration certificates, with a total registered capital of more than 257.28 million USD (equalling 65% year on year); and 24 projects registered to adjust their investment with additional capital of nearly 137.75 million USD (up 75.9 times year on year).

Vietnamese investors have invested in 15 sectors abroad. Of which, wholesale and retail took the lead with 40 newly-registered projects and 7 times of adjusting investment capital, with total registered capital of nearly 153.65 million USD, accounting for 38.9% of the total. Next came information and communication with over 120.4 million USD, accounting for 30.5%. Followed by electricity production and distribution,  agriculture, forestry and fishery industry, manufacturing and processing industry and so forth.

There were 26 countries and territories receiving investment from Vietnam in the first eleven months of 2023. Leading is Canada with one newly-registered and two capital-adjusted projects with the total registered capital of nearly 150.3 million USD, accounting for 38% of the total. Followed by Singapore, Laos and Cuba.

Accumulated as of November 20, 2022, Vietnam had 1,694 valid aboard investment projects with total registered investment capital of 22.1 billion USD.

Vietnam’s investment aboard focuses mainly in: mining (31.6%); agriculture, forestry and fishery (15.5%). The areas receiving the most investment from Vietnam were Laos (24.8%); Cambodia (13.2%); and Venezuela (8.3%)./.

(Detailed data in Appendix IV and V attached)


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