Bright spots in the 2023 economic picture

Foreign direct investment (FDI) is a driver of economic growth and is all the more important as other key sectors have yet to recover as expected.

In fact, this sector is showing “contradictory” developments, rising quite spectacularly, partly compensating for other sectors, while creating momentum for a breakthrough, restructuring and enhancing competitiveness for the entire economy in the near future. In the immediate future, it can be said that FDI activities will be the brightest part of the economic picture in 2023…

Electronic components manufacturing at Katolec Vietnam Co., Ltd., Quang Minh Industrial Park (Me Linh district).

Total new FDI capital increased by 14.7%

According to the General Statistics Office, the total newly registered capital, adjusted registered capital and capital contribution and share purchase value of foreign investors in Vietnam in the first 10 months of 2023 reached 25.76 billion USD, up 14.7% over the same period in 2022. The disbursement results of this capital source also developed in the same direction when FDI enterprises implemented 18 billion USD, up 2.4% over the same period last year.

This demonstrates the maintenance of the growth momentum and the reach of this important growth driver in the context of FDI activities remaining stagnant and shrinking internationally. Reality also shows the increasingly stable attractiveness and competitiveness of Vietnam in the race to attract FDI capital with many other countries.

It is noteworthy that, in addition to the continued increase in capital, the quality of new FDI projects also goes hand in hand, tending to be modern, belonging to high-tech fields and in line with Vietnam's orientation of "increasing quantity and quality". Recently, the Amkor Group's semiconductor factory with a total capital of 1.6 billion USD was inaugurated in Bac Ninh . From a local perspective, many potential provinces continue to promote their advantages, achieving good results in attracting new capital sources.

For example, Dong Nai province has welcomed a number of large companies and corporations from the US and Japan to seek investment opportunities and has attracted more than 1 billion USD in FDI capital in the past 10 months - exceeding the plan for the whole year of 2023 (attracting 700 million USD). Some potential investors are proposing to invest in the fields of advanced optical equipment manufacturing, electronic components, smart cities, etc.

The reason for the recent increase in new capital comes from the stability and continuous improvement of Vietnam's investment and business environment. In addition, there is the need to shift production locations to diversify the supply and origin of products of large technology corporations in the world.

Experts say that the fact that investors are seeking opportunities and are increasingly implementing large projects in the high-tech sector demonstrates the attractiveness of our country's infrastructure and human resources.

Persistence, focus on reform

Vice President of the Association of FDI Enterprises Nguyen Van Toan shared that the limitations, called “bottlenecks” for FDI activities in the previous period such as infrastructure, human resources, economic institutions, etc., have been and are being resolved in a transparent, open and thorough manner. In fact, many investors are very interested in Vietnam as a destination to implement large-scale industrial production projects that have widespread influence and require a lot of capital and intelligence.

Minister of Planning and Investment Nguyen Chi Dung stated that in addition to general solutions such as stabilizing the macro economy, improving infrastructure and human resources, in the coming time, Vietnam will focus on building and developing an ecosystem of science, technology and innovation, suitable for the digital business environment and clean production. In which, the role and importance of the high-tech sector will be emphasized.

On their side, most localities have also proactively accelerated the completion of infrastructure systems, paying attention to the essential needs of investors with a commitment to long-term companionship. In particular, a representative of the Department of Planning and Investment of Dong Nai province said that long-standing difficulties such as land clearance, clean land planning, connecting infrastructure in industrial parks, etc. are being thoroughly and quickly resolved by the government. When the above issues are well resolved, it means increasing the attractiveness of the investment and business environment in Vietnam. That is also the premise and condition to attract more FDI capital in the medium and long term.

The Government is resolutely directing ministries and branches to focus on administrative reform quickly and substantially to support and serve businesses more effectively. Deputy Prime Minister Tran Luu Quang, Head of the Prime Minister's Administrative Procedure Reform Working Group, has just signed and issued Official Dispatch No. 100/TCTCCTTHC on continuing to promote decentralization of administrative procedures and reduce and simplify internal administrative procedures. Notably, the Government requires proactively reviewing to reduce and simplify at least 20% of administrative procedures and reduce at least 20% of costs of compliance with internal administrative procedures in the 2022-2025 period.

At the same time, many ministries, branches and localities are taking drastic measures, providing specific information and influencing the investor and business community in general. For example, the Ministry of Planning and Investment has identified administrative procedures that need to be digitalized and shortened. This is an important task, contributing to reforming the investment and business environment, supporting and creating favorable conditions for businesses.

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