FDI disbursement figures augur well for confidence
Fuelled by the country’s efforts to improve the domestic business climate, the disbursement of foreign direct investment in Vietnam has reaped a bumper crop, reflecting the rising confidence of investors.
The disbursement of foreign direct investment in Vietnam rose 15.1 per cent to some $19.68 billion in the period, the highest 11-month figure over the past five years, according to the General Statistics Office.
Another bright spot in the period was operational projects’ adjusted capital, which surged 23.3 per cent on-year to $9.54 billion.
Adjusted capital and disbursed capital continued to maintain growth momentum, which is demonstrating confidence from foreign investors in the economy and business environment of Vietnam.
Hyosung Financial System Vina (HFS Vina) – a member of South Korean conglomerate Hyosung Group – is concentrating on shifting its manufacturing line of ATMs from China to Vietnam after taking the first $110 million facility into operation in the northern province of Bac Ninh in late 2021.
Lee Cheon Ho, acting general director of HFS Vina, said that the major reasons for the company deciding to select Bac Ninh for expansion are the synchronous infrastructure together with the support of provincial authorities.
“When we studied the investment opportunity in Vietnam, the company’s biggest concern was the complicated procedures. However, the company has received support for this as well as in construction and taking the factory into operation,” Ho said.
At first, the company faced some difficulty in land clearance. However, the problem was also resolved thanks to cooperation between Yen Phong People’s Committee and Bac Ninh Industrial Zones Management Authority. Hence, the construction of the first project began on time.
The satisfaction with the investment environment is a motivation for reinforcing the company’s plan to make Vietnam to become its ATM manufacturing hub, and the company is aiming to stop production of its facilities overseas to focus on Vietnam from 2023.
HFS Vina will use 60 per cent of domestic materials for production here and, along with trading and production activity, the company also has plans to establish a high-tech research and development centre for tech transfer and to improve labour force quality.
Creating favourable conditions for investors is a priority of many localities to attract and retain large-scale groups. The common denominator of localities is being proactive in working with investors to listen to their troubles to offer speedy solutions.
For example, the northern province of Vinh Phuc has held dozens of working sessions and dialogues with businesses to remove their difficulties during the business and investment process, according to Vinh Phuc People’s Committee.
The province has resolved over 280 proposals and recommendations of businesses; directly contacted and worked with around 140 enterprises; and created maximum conditions for 335 enterprises facing difficulties to complete bankruptcy procedures.
Vu Kim Thanh, deputy director of Bac Ninh Industrial Zones Management Authority, told VIR, “The departments and authorities established chat groups to provide over 100 assignment documents for businesses, replied to 75,000 emails, and have received thousands of messages from businesses and investors.”
Many investors with famous global brands are successfully operating in the province such as Sojitz Group and Sumitomo Corporation, while continuing to expand projects on a large scale and creating an attractive push to attract many satellite projects. “As a result, many investors express their interest in developing industrial parks, which the province is adding to the provincial development planning,” Thanh said.
Meanwhile, Thanh Hoa, Vinh Phuc, Quang Ninh, and Ba Ria-Vung Tau provinces have established dedicated offices that concentrate on supporting leading foreign investors from South Korea and Japan.
Prime Minister Pham Minh Chinh has chaired annual hybrid meetings with foreign-invested enterprises (FIEs) and business associations, during which he pledged to create favourable conditions for them to invest successfully and sustainably in Vietnam.
PM Chinh requested ministries and localities to effectively implement the guidelines of the Party, policies, and laws of the state; directions of the government and the prime minister on national governance in a modern, effective, and competitive manner; and perfecting institutions and policies on foreign investment cooperation. Ministries and relevant government agencies were asked to have plans in place to solve difficulties facing FIEs; and focus on improving the business investment environment and simplifying administrative procedures to make it easier for them to operate in Vietnam.