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| Canon, one of the largest projects of Japan in Vietnam. |
VietNamNet Bridge – An official from the Ministry of Planning and Investment (MPI) has said that Vietnam can attract US$7 billion of direct foreign investment (FDI) this year because around 30 projects totaling billions of US dollars are still waiting for investment licences.
33 projects awaiting licences
At the end of October, the MPI’s Foreign Investment Agency announced optimistic data about FDI attraction. The total volume of capital of new projects and of capital increasing projects reached $6.485 billion, approximately the level set for the whole year ($6.5 billion), up by 41.4% year on year.
Notably, there were around new 705 projects licenced with a total registered capital of $4.7 billion, 60% more than the corresponding period of last year, a record high level for recent years.
Phan Huu Thang, Director of the Foreign Investment Agency, said that Vietnam was quite capable of luring $7 billion of FDI this year because more than 30 projects worth billions of US dollars were still waiting for investment licences.
“It is clear that there is a strong wave of foreign investment in Vietnam thanks to the country’s great efforts to improve the investment environment, its strong growth rate (estimated to be 8% this year), and its accession to the World Trade Organisation this November,” said Mr Thang.
For many years, northeast Asian economies have taken the lead in investment in Vietnam, typically Taiwan, Singapore, Japan, the Republic of Korea and Hong Kong, which account for nearly 60% of the total registered capital. But Japan may take the top position due to the strong commitments made by the leaders of Vietnam and Japan during the visit of Vietnamese Prime Minister Nguyen Tan Dung to Japan last month.
Investors from the US are also potential rivals. The US ranked third in investment in Vietnam in the January-October period of 2006. However, it would have been first if projects that American investors invest in through a third country had been calculated.
According to Mr Thang, the advantage of Vietnam that is most appreciated by international investors is that the country is a dynamic economy and it is about to become a member of the WTO.
Breakthrough in decentralisation
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A group of 40 Japanese companies led by the Vice President of the Shoko Chunkin Bank, Mr, Otake Kenichiro, has come to Vietnam to learn about investment and cooperation opportunities.
On October 27, the groundbreaking ceremony of the second phase of the Thang Long Industrial Zone, Hanoi was organised. This is a joint venture project between Japan’s Sumitomo group and a Vietnamese partner, which shows the move of a new wave of investment into Vietnam. |
To welcome the new wave of investment, the Vietnamese government is striving to improve its investment climate. In late October, some decrees guiding the implementation of the Investment Law and the Enterprise Law took effect.
The major spirit of those decrees is that the Vietnamese government will further decentralise management over FDI. Accordingly, local governments will have more power to licence FDI projects.
The government will soon issue an instruction on measures to create a new wave of investment.
The MPI is evaluating over 30 FDI projects, including large-scale ones such as a power plant project in the northern province of Lao Cai with investment of nearly $28.8 million; the $1.9 billion mining and iron refinery project in the central province of Ha Tinh by S.H.T Iron & Steel Company; the $1 billion tourism project on Phu Quoc Island by the US’ Rockingham group; the $500.2 million tourism project in the central province of Phu Yen; and the $211.9 million new residential area project invested in by Vinaconex and a Korean partner.
(Source: Lao Dong)
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