FDI - Important Contribution to Local Socioeconomic Development

2:30:51 PM | 8/10/2020

Foreign investment attraction in Vinh Phuc province in the past years has produced positive results. Foreign direct investment (FDI) companies have made important contributions to local socioeconomic development, created more jobs, promoted average GRDP growth, and increased local budget revenue. In the 2016-2020 period, FDI firms paid nearly VND115.5 trillion to the State budget.

According to the report of the Department of Planning and Investment, Vinh Phuc province will have 444 valid FDI projects with a total registered investment fund of US$5.02 billion by the end of 2020. In the 2016-2020 period, the province licensed 265 new FDI projects with US$1,354.52 million and allowed 202 projects to add over US$1,213 million to their investment base. Among 18 countries and territories investing in Vinh Phuc, South Korea currently takes the lead with 207 projects and US$2.207 billion, followed by Japan with 47 projects and over US$1.169 billion and Taiwan with 37 projects and US$943.66 million.

With the timely execution of investor support mechanisms and policies, more FDI companies are doing successful business and thus contributing more to local socioeconomic development.

FDI projects got US$1.696 billion disbursed in the 2016-2020 period. In particular, in this period, FDI companies accounted for 56-70% of industrial output value, achieved export value of US$19.480 billion; employed about 150,000 workers and paid VND115,483 billion to the State budget, accounting for about 65% of total State budget revenue of the province.

In the coming time, the investment flow from South Korea and Japan is forecast to rise rapidly as Thang Long Vinh Phuc Industrial Park - Phase 2 is completed and Dong Soc Industrial Cluster comes into operation. Along with that, Vinh Phuc will draw many investment projects from European countries and the United States.

To utilize advantages to approach and attract world-leading investors from developed countries to hold new and advanced technologies, modern governance and international competitiveness in sectors that produce high added value and are environmentally friendly, Vinh Phuc will further improve the business environment to achieve three good goals: Good and comprehensive legal environment, good technical infrastructure and good business service.

It cannot be denied that the FDI sector significantly contributes to local economic development. However, besides economic goals, when calling for foreign investment, Vinh Phuc also expects foreign investors to transfer technology to domestic enterprises. FDI enterprises are hoped to be the nucleus to connect local domestic enterprises to join global supply chains, enhancing the value of Vietnamese goods in general and of Vinh Phuc province in particular.

By Nguyet Tham, Vietnam Business Forum