Processing and manufacturing industry attracts foreign investment

Assembling industrial machines at Precision Mechanical Engineering and Technology Transfer Joint Stock Company, Phu Nghia Industrial Park (Chuong My district). Photo: Nguyen Quang

Attractive environment

In 2023, the processing and manufacturing industry alone attracted over 23.5 billion USD of FDI capital, accounting for 64.2% of the total registered FDI capital in Vietnam and an increase of 39.3% compared to the results in 2022. This result makes the processing and manufacturing industry the industry attracting the largest FDI capital among the 18 economic sectors with foreign direct investment.

In January 2024, the amount of FDI disbursed in Vietnam reached 1.48 billion USD, an increase of 9.6% over the same period in 2023. Of which, the processing and manufacturing industry alone disbursed 1.15 billion USD, accounting for 77.7%. This is a promising signal for a more positive change in 2024, and at the same time a clear expression of investors' confidence in the future, their desire to increase their presence and do long-term business in Vietnam.

Minister of Planning and Investment Nguyen Chi Dung affirmed that this result was achieved because Vietnam always paid attention to and proactively improved the quality of the business environment and enhanced competitiveness to meet the needs of investors. In addition, Vietnam focused on calling for and selecting projects that apply modern technology, have a positive impact on the process of restructuring and modernizing the economy, thereby realizing the goal of improving the quality and efficiency of FDI activities in Vietnam.

It can be seen that Vietnam is still a favorable business environment, rich in potential, attractive to investors, especially investors in the processing and manufacturing industry. In addition, the wave of shifting and dispersing capital sources of investors globally is also an important reason why many foreign corporations and companies choose Vietnam as a destination to diversify investment locations to increase opportunities and avoid risks...

Experts also said that one of the major reasons for attracting FDI capital into the processing and manufacturing industry is that Vietnam has the advantage of a large and high-quality labor force, combined with a stable macroeconomic policy, an open and safe market, etc.

In fact, the processing and manufacturing industry has attracted large, influential industrial corporations in the world such as Samsung, LG, Amkor, Honda, Intel, etc. These are also names that have expressed their desire to expand their investment scale in the coming time. As a result, up to now, the economic sector with FDI capital regularly contributes over 70% of the country's total export turnover in addition to creating millions of jobs, contributing to the budget as well as participating in human resource training and technology transfer in Vietnam.

Continue to grow, take the initiative

Entering 2024, Vietnam continues to be an attractive destination, attracting many more FDI projects, including high-quality industrial projects in key sectors. For example, the project to build a Goodway Vietnam factory by Taiwan (China) in Lien Ha Thai Industrial Park (Thai Binh province), producing connection devices and computer peripherals, with a total investment of 45 million USD. The European Chamber of Commerce's assessment of the outlook for the first quarter of 2024 is also very positive, with 29% of businesses saying it is "excellent" or "good". In contrast, the level of concern among businesses has decreased from 9% to 5%.

Many localities are proactively organizing promotion activities to increase FDI attraction in a more practical and effective way. For example, Bac Giang province has determined not only to contact and invite foreign enterprises but also to promote on-site investment promotion activities through taking care of licensed projects, creating the best production and business environment for FDI enterprises. From there, they will introduce other investors to invest and operate in Bac Giang. Meanwhile, Nghe An province is consistent in its stance of being ready to create maximum conditions for investors, making the province a "favorable, trustworthy and effective" location for foreign investors.

In particular, in recent diplomatic events and dialogues between the Government and a number of large corporations in the world such as Google, Siemens, Qualcomn, Ericsson, etc., businesses all highly appreciated Vietnam's economic achievements and hoped that the Vietnamese Government would continue to create favorable conditions for investment in the development of technology, innovation, and semiconductor chip manufacturing. From the third quarter of 2023 to present, international economic organizations also assessed that Vietnam will gradually become an important location for the semiconductor manufacturing sector of regional and international stature through receiving large-scale FDI projects with advanced technology.

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