Processing and manufacturing sector attracts FDI

The Ministry of Planning and Investment stated that in the first 8 months of this year, foreign investors invested in 19 sectors in Vietnam, among which the processing and manufacturing industry took the lead in both number of projects and registered capital - more than US$10.5 billion, accounting for 73.3 percent of all foreign direct investment (FDI) that Vietnam attracted in the eight months.

According to the Ministry of Planning and Investment’s Foreign Investment Agency (FIA), in the first 8 months, Vietnam attracted an additional US$14.3 billion in FDI (up 7.7 percent from the same time in 2015), including registered capital of 1,619 new FDI projects and increased capital of 770 other FDI projects. All of these projects came from 65 countries and territories worldwide. The processing and manufacturing industry alone attracted an additional US$10.53 billion through 678 new projects and 551 projects with increased capital, accounting for 73.3 percent of all foreign direct investment (FDI) that Vietnam attracted in the eight months.

The sector lured many large, quality projects of world leading businesses such as Samsung and LG, including the Republic of Korea (RoK)’s US$1.5-billion LG Display Hai Phong project licensed on April 15, 2016 to manufacture polymer OLED displays for such mobile devices as cell phones, smart watches, tablets; Samsung Electronics Vietnam Ltd.’s US$300-million Samsung Research and Development Center project; and the RoK’s US$300-million Seoul Semiconductor Vina project in Ha Nam Province, designed to research, develop, assembly and fabricate LEDs, among others.

Ministry of Planning and Investment’s Central Institute for Economic Management (CIEM) Director, Dr. Nguyen Dinh Cung said that large foreign investment flows into the processing and manufacturing industry are a good sign. They not only help create jobs but also provide the opportunity for Vietnamese workers to improve their skills. The processing and manufacturing industry’s development creates opportunities for support industry development in Vietnam, helps attract more FDI, and paves the way for Vietnam to become an industrialized country by 2020.

World Bank’s Vice President for the East Asia and Pacific Region Victoria Kwakwa said that, the Vietnamese processing and manufacturing industry has attracted great attention of foreign investors, thanks to which has made great progress, significantly contributing to the country’s export growth. She added that Vietnam could become a processing and manufacturing center in the world, and that the sector will probably attract about US$90 billion - equal to half of Vietnam’s gross domestic product (GDP) - in the next 10 years.

Economists have said that Vietnam is improving its investment climate through actively implementing the Enterprise Law, the revised Investment Law, as well as through economic restructuring based on restructuring the banking system, public investment and the state-owned business sector. This is important for Vietnam to attract more FDI to its processing and manufacturing industry.

Hoa Nguyen / ven.vn