Vietnam’s November FDI Hits US$61 Billion

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Dec. 13 – The Foreign Investment Agency reports that by early November registered foreign direct investment (FDI) in Vietnam amounted to US$61 billion.

According to Vietnam Net, by the end of the year the FDI could reach US$65 billion although FDI forecast for 2009 is only US$30 billion.

Vietnam's concept of FDI is different from the standard. While Vietnam reports FDI based on registered and implemented FDI, the usual standard is realized FDI.

Registered FDI is defined as the total FDI registered in investment licences, including equity capital and credits. Equity capital can include foreign capital and capital invested by domestic partners while credits include loans from foreign and local banks.

On the other hand, implemented FDI is considered the implemented capital- foreign and local. The figures on registered and implemented FDI is gathered by the Ministry of Planning and Investment.

The rest of the world measures FDI based on realized FDI which is the real flow of foreign capital invested in the country and seen in the international balance of payment. This number therefore does not include funding from local partners or local banks.

According to the Foreign Investment Agency, the difference between registered FDI and implemented FDI is increasing as many FDI projects are now based on capital funded by state corporation and credits from local banks.

Vietnam agencies add local capital to FDI statistics because high numbers incalculate achievement and pride in the country's investment environment reports Vietnam News.

Currently, registered FDI in real estate, heavy industry projects is increasing although labor-intensive processing industries like light industry, food processing, agro-forestry-fishing is dropping.