9M FDI result positive

Despite the lingering pandemic, FDI into Vietnam in the first nine months of 2021 increased 4.4 per cent year-on-year.

According to the Foreign Investment Agency (FIA) at the Ministry of Planning and Investment, Covid-19 has severely impacted production in Vietnam and also affected FDI disbursement.

As of September 20, FDI disbursement was estimated at $13.28 billion, down 3.5 per cent over the same period of 2020.

Newly-registered capital and additional capital rose in the first nine months by 20.6 per cent and 25.6 per cent, respectively, year-on-year. But project numbers were down in both categories, by 37.8 per cent and 15 per cent, respectively. Declines were primarily seen in small-scale projects with investment capital of less than $5 million. The number of large-scale projects, with investment capital of over $50 million, still rose sharply.

Experts have said that this is a positive result in the context of Covid-19, when production and operations are facing myriad difficulties.

The FIA said that restrictions on foreigners entering Vietnam and the long-term quarantine policy have slowed down foreign investors, while factory closures and travel restrictions on workers at industrial parks have affected investment plans. It also warned that investors may move their investments to other countries if factory closures and labor shortages continue for too long.

FDI attraction through capital contribution and share purchases continued to decline in the first nine months, with the former at nearly $3.2 billion, down 43.8 per cent year-on-year.