Investment in Mekong subregion expected to recover post pandemic
Investment in Mekong subregion expected to recover post pandemic
At the 10th Mekong forum on strengthening development cooperation and economic recovery in the Mekong region on September 23, the attendants discussed ways to recover the economies of the Mekong subregion countries in collaboration with policy adjustments.
Dr. Nguyen Anh Tuan, standing vice chairman of the Vietnam Association of Foreign Invested Enterprises, showed many advantages of promoting foreign direct investment (FDI) in the Mekong subregion.
“The establishment of a full ASEAN Community by 2025 will create new favourable conditions for promoting direct investment within the bloc and between ASEAN and the world. As members of the ASEAN Community, the Mekong subregion countries have opportunities to take advantage of these favourable factors,” Tuan said.
According to Tuan, recognising the role of FDI in socioeconomic development, Mekong subregion countries have been adjusting policies to attract investment, creating a more transparent and favourable investment environment.
To take advantage of attracting internal direct investment, countries in the region would need to continue to improve the investment environment, create favourable conditions, and adopt policies to promote economic cooperation and contribute actively and responsibly to the building of a complete ASEAN Community by 2025.
“Countries need to improve the resilience of the economies in the region against negative external impacts to maintain macroeconomic stability, control inflation, and overcome supply chain disruption and the shortage of highly qualified labour forces in some countries,” Tuan said.
Vietnam will be a reliable partner of businesses inside and outside the region before, now and in the future.
The latest forecast of international institutions shows that Vietnam’s GDP growth rate in 2022 could reach about 6.5-7 per cent compared to 2.8 per cent in 2021. After a decline of 6.2 per cent in 2020, Thailand’s economy reached a growth rate of 1.6 per cent in 2021 and may hit 4.5 per cent in 2022.
The Asian Development Bank predicted Laos would recover with 3.4 per cent GDP growth this year and 3.7 per cent in 2023.
In the development orientation of the Greater Mekong region, Vietnam plays a central and connecting role in the region, as well as in the development of production networks and value chains in the region.
Assoc. Prof. Dr. Nguyen Duy Dung, director of the Institute for Southeast Asian Studies said, “Vietnam will be a reliable partner of businesses inside and outside the region, now and in the future.”
Data from the Foreign Investment Agency under the Ministry of Planning and Investment shows that as of August 2022, Vietnam had invested in four Mekong countries – Laos, Cambodia, Myanmar, and Thailand – with 549 valid projects worth $9.73 billion, accounting for 87 per cent of Vietnam’s capital invested in ASEAN countries.
Of these, 237 projects are located in Laos with the total registered investment capital of nearly $5.3 billion, 197 projects in Cambodia worth $2.9 billion, 109 projects in Myanmar worth $1.5 billion, and 16 projects in Thailand worth $32.8 million.
Vietnam’s investment in this region mainly focuses on mining, agriculture, forestry and fishery, manufacturing and processing, banking, finance and insurance, real estate, and wholesale and retail.
