Bright prospects in Vietnam’s FDI attraction (2024)

Hanoi (VNA) – There are factors that strongly drive the growth of Vietnam’s foreign direct investment (FDI) attraction in the second half of this year and there will be interesting surprises waiting ahead, said Chairman of the Vietnam's Association of Foreign Invested Enterprises (VAFIE) Prof. Dr. Nguyen Mai.

According to Mai, the economy grew nearly 7% in the second quarter, and also increased in the first half of 2024 against the same period last year. The growth is one of important factors that help Vietnam attract FDI.

In addition to political stability, Vietnam's FDI attraction policies have been getting good valuation from foreign investors, he said, adding that the strategy to attract FDI in key fields such as semiconductors and future technology is on the right track, he said.

Regarding the semiconductor industry, the US has pledged to support Vietnam in training 50,000 engineers and 500,000 workers from now to 2030. Big corporations such as VinGroup, FPT or Viettel are all actively engaging in the semiconductor industry.

These factors are providing strong support to Vietnam’s FDI attraction, and there will be surprises in the near future, Mai said.

Not only the US and the EU, investors from China and Hong Kong (China) are flocking to Vietnam to learn about investment opportunities in technology and renewable energy, he said.

With the recovery, Vietnam could attract 35-37 billion USD in newly registered and expanded FDI in 2024, Mai forecast.

With their advantages, some localities have been emerging in attracting FDI.At the World Economic Forum (WEF) meeting held in Dalian, China last month, representatives from the Foxconn Technology Group announced its new plant in Vietnam that has just been put into operation.

Foxconn has so far had factories in five provinces in Vietnam with a total investment of 4 billion USD, employing about 80,000 workers.

Notably, Foxconn said it has decided to pour nearly 400 million USD to build a factory specialising in producing electronic components, assembling and processing PCB circuit boards in Nam Son Industrial Park in northern Bac Ninh province.

Last month in northern Bac Giang province, Nokia announced cooperation with Foxconn to produce AirScale products, including the latest generation of massive MIMO AirScale radio devices serving 5G infrastructure.

A Nokia representative said the project will start in July, and products made at this factory will be used in both the domestic and international markets. Foxconn is Nokia's global manufacturing partner, and will expand its capacity to produce Nokia’s 5G products in Vietnam.

Whenever technology "eagles" like Foxconn and Goertek accelerate their expansion in a destination, it will create opportunities for the destination to attract other technology giants like Apple, Google or Huawei because Foxconn or Goertek are manufacturers that supply original equipment to major technology companies in the world.

Vietnam attracted nearly 15.2 billion USD in FDI in the first six months of this year, a year-on-year increase of 13.1%, according to the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment.

The foreign investors funneled their capital into 48 cities and provinces across the nation, with Bac Ninh leading in FDI attraction with nearly 2.6 billion USD. In the second and third places were Ba Ria – Vung Tau and Quang Ninh, with corresponding FDI of some 1.54 USD billion and 1.36 billion USD.

The FIA stated that investment capital mostly flows to localities with many advantages such as good infrastructure, stable human resources, improvements in administrative reforms and dynamic investment and trade promotion.

Particularly, the ten localities of Bac Ninh, Ba Ria-Vung Tau, Quang Ninh, Hanoi, Hai Phong, Ho Chi Minh City, Dong Nai, Bac Giang, Binh Duong, Hung Yen attracted 79.5% of new FDI projects and nearly 78% of the country's FDI capital in first five months of this year./.