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Economic Update 2006

adapted from http://www.vietpartners.com


Vietnam attracted US$1.32 billion in foreign direct investment (FDI) in the first two months of 2006. Of the total, $1.18 billion came from 113 newly licensed projects, an increase of 16 per cent in project numbers and 15 per cent in registered capital over the same period last year. The total excluded the latest Intel Corp project for a $605 million IT plant in HCM City. As much as $135 million was added to 38 existing FDI projects, a year-on-year increase of 41 per cent.

In February alone, 55 projects, with registered capital totaling $765 million, were granted licenses, and 27 projects added $110 million to their investments. The biggest investors in Vietnam in the first two months of 2006 were South Korea, Japan, Taiwan, and the U.S.A.

The largest growth sectors were real estate and industry sectors. In the first two months of this year, HCM City attracted the largest FDI with $645 million from 40 projects, followed by Hanoi with a total FDI of $415 million from nine projects, and Dong Nai Province with a total FDI of $98 million from 21 projects.

 

FDI PROJECTS as 22 February 2006 (BY PROVINCE, north to south)

City/Province

No. of projects

Registered Capital ('000 USD)

Legal Capital ('000 USD)

Hanoi

9

415,034.0

184,925.5

Vinh Phuc

2
6,756.3
4,700.0

Ha Tay

1
500.0
300.0

Hai Duong

4
81,700.0
40,000.0

Hai Phong

4
11,790.0
7,700.0

Lao Cai

1

200.0

200.0

Yen Bai

1
4,900.0
1,470.0

Thanh Hoa

1
1,000.0
1,000.0

Danang

1

5,000.0

1,500.0

Binh Duong

25
39,862.0
13,385.0

Dong Nai

21
98,890.0
49,556.2

Ho Chi Minh City

40
645,426.5
186,334.8

Long An

3
8,000.0
2,700.0

 

TOTAL FDI CAPITAL IN VIETNAM 1998 - 2005

(Click on the graph to enlarge image)

 

Vietnam attracted foreign direct investment of US$ 5.8 billion in 2005, a record high for the past eight years. Of the total figure, almost US$ 4 billion came from 771 newly licensed FDI projects and the rest from additional investment injected into existing projects.

The year 2005 could not have gone better for foreign entrepreneurs in Vietnam who reached their highest revenue, US$ 20 billion, since the 1997 Asian monetary crisis, and contributed US$ 1.3 billion to the State budget.

The Government has continues to try to perfect its legal system, created more incentive policies for foreign investors, and tried to fulfill its commitments to the international community. These progressive steps have tried to increase the confidence of foreign investors in pouring their money into the country. Besides, Vietnam's efforts to maintain its socio-political stability and step up and professionalize investment promotion activities also play a crucial role in increasing the FDI flow.

Foreign investors continue to recommend that the Government speed up improvement of its legal mechanism, prepare instructive documents for the implementation of the Investment Law and the Enterprise Law, intensify the decentralization process and investment management work, create incentive policies for the development of supporting industries and facilitate the Viet Nam-Japan Joint Initiative Program and the Viet Nam-Singapore Economic Linkage Project, he said, adding that these are crucial steps to raise Viet Nam's competitiveness in attracting FDI. (Excerpted  from Vietnam News Agency, Vneconomy News)

 

VIETNAM FDI MECHANISM (1998 - NOVEMBER 2005). Source: MOT, MPI, VNA


(Click on the graph to see full image)

 

TOP 10 PROVINCES/CITIES WITH FDI PROJECTS


(Click on the graph to see full image)

 

TOP 10 INVESTOR NATIONS IN VIETNAM


(Click on the graph to see full image)

For additional charts and tables on Current Foreign Direct Investment in Vietnam, see Economic Reports

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