May 27 – According to the Ministry of Planning and Investment’s Foreign Investment Agency, foreign investment during the first 5 months of the year dropped by 76 percent to US$6.68 billion compared to the same period last year.
Only 256 new foreign-invested projects worth US$2.7 billion were licensed, a 89 percent plunge from previous figures while disbursements of committed capital also slowed down by 29 percent to US$2.8 billion. However, more capital was registered to 40 existing projects amounting to US$3.96 billion, a 28 percent increase. The top foreign investor in the country is still the United States at more than US$3.85 billion and nine new projects worth US$53.5 million. This is followed by South Korea with 59 new projects worth US$1 billion, making it the largest investor in terms of new registered investment.
The other top investors are Hong Kong at US$540 million and Singapore at US$539 million.
Most of FDI went to the services sector attracting US$4.5 billion, although 96 percent of the amount comes from investment into already existing projects.
The next most attractive sector is real estate with US$1.45 billion and making up for 21.6 percent of total.
The hottest location in the country in terms of FDI allocation is Ba Ria–Vung Tau Province, followed by Hoh Chin Minh City, Binh Duong Province, Danang City and Vinh Phuc Province.
The Ministry of Planning and Investment is calling for the liberalization of more sectors to foreign investment including culture, health care, education, communications, maritime transportation and aviation.
In the long term, the government wants more FDI to flow into infrastructure projects. They are currently revising master plans for national infrastructure through 2020 with a goal to promote water supply and drainage, the environment, highway construction, railway services, seaports and logistics facilities.
