According to updated data on Foreign Direct Investment (FDI) in Vietnam in September, FDI disbursement and registered capital are lower than that of the past few months. Notably, there are some critically low criteria.
According to the Foreign Investment Agency (FIA) of the Ministry of Planning and Investment, in September, disbursed capital was around US$900 million, the lowest in the 3rd quarter of 2011.
However, total disbursement of FDI so far this year has been about US$9.2 billion, up 2 percent compared with the same period in last year. There is not enough data to analyse the specific movements of disbursed FDI capital flows into the manufacturing sector. The relevant information stated that import - export activities of businesses in those sectors were growing very well.
FIA data on bilateral turnover shows that importing and exporting in the FDI sector rose 30 percent over the same period. In more detail, export turnover including crude oil has reached US$38.142 billion. It rose 38 percent over the same period, while export excluding crude oil was US$ 32.447 billion and grew 35 percent.
Meanwhile, import of this sector in the first 9 months of 2011 was estimated to reach US$34.08 billion. Thus, the FDI sector incurred a trade surplus of US$4.062 billion, including oil export turnover, or a trade deficit of US$1.633 billion excluding this fuel.
However, in terms of registered capital, the situation is entirely different. Some indicators are at alarming levels.
Analysis of FIA’s data showed that, in September, the country attracted only about US$ 294 million in newly registered FDI investments, the lowest from February until now. Similarly, added registered capital only reached US$ 41 million last month.
Generally, from the beginning of the year, total newly registered FDI capital reached US$ 9.903 billion, which dropped 28 percent from the same period last year. This included US$ 8.238 billion of newly registered investment, dropping by 31 percent, while increased capital was US$1.666 billion, dropping 3 percent.
Many questions were raised because of the numbers above. Where is the Japanese capital, as many previous predictions showed that Vietnam is the number one destination for this investment? What is the affect of the double earthquake and tsunami disaster in the third largest economy in the world, and the world’s economic crisis, on global FDI flows? Is Vietnam losing its position as a good destination for investment?
On this point, there is a note related to investment. Unlike last year, when the real estate business with many large projects was always first in attracting investment, total registered investment hasn’t fallen too far compared with a year earlier. This year, real estate is "floating" down to the sixth position, only about 3 percent of total registered investment.
In contrast, the field attracting the largest capital in nine months, processing manufactured industry, is not too bad compared with last year. The total registered FDI in this sector in 9 months is nearly US$ 4.912 billion, increasing 33.6 percent over the same period last year.
Even the manufacturing, electricity, gas, water, air conditioning and construction sectors are in the top three leading attractive groups this year, but still much lower than the same period of 2010. Production and distribution of electricity, gas, water and air conditioning attracted US$ 2.525 billion, decreasing by 14 percent, while construction attracted more than US$689 million, dropping nearly 37 percent compared with the same period last year.
In summary, the goal of attracting US$20 billion in FDI capital in 2011, given the current situation, will be difficult to achieve in spite of a year’s development.
Vietnamese
