HCM City attracts over US$1 billion FDI investments in first two months
More than US$1.02 billion of foreign direct investment (FDI) was registered for projects in HCM City in the first two months of the year, according to the Ministry of Planning and Investment.
In January, HCM City received registration for FDI of more than US$745 million, the largest amount of FDI for any locality in the country.
It included $32.72 million investment in 68 new FDI projects, and additional investment of $4.7 million for 11 operational projects.
The city also approved 191 cases of foreign capital contributions to purchase shares of local businesses (from local shareholders) with total value of more than $452 million.
Le Thanh Liem, deputy chairman of HCM City People’s Committee, said that in 2018 the city received more than $7 billion in FDI, including $6 billion registered in the form of capital contributions and purchases of shares of local enerprises.
The number and value of FDI in M&A (mergers and acquisitions) projects increased significantly in the last few years, from $1.5 billion in value in 2016 to 3.68 billion in 2017, and to $6 billion in 2018.
Investment in M&A projects totals more than $10 billion, accounting for 22 per cent of the total FDI mobilized by HCM City since 1988.
Foreign investors favour M&As because of the simple investment procedures and favourable conditions, an official from the HCM City Department of Planning and Investment said.
M&A deals do not require investment registration certificates from investors, he added.
However, M&As also help foreign investors “avoid” procedures for investment licenses for these projects. The official asked agencies to issue legal documents for management of this investment resource.